Posts for 'Intel Media'

In an interview with Recode on Tuesday, Sony Computer Entertainment America President and CEO Shawn Layden said the company is still planning to launch a "revolutionary" OTT pay-TV service by the end of 2014.

However, as Intel learned with its own misguided OnCue foray, the big cable network owners aren't enabling any revolutions to occur in the pay-TV industry. To the contrary, they're working hard to extend the status quo. This, plus other factors, means the odds of success for Sony's nascent OTT pay-TV service are extremely low.

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I'm pleased to present the 211th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

In today's podcast we review Netflix's stellar 2013 results, particularly focusing on international. Then we discuss how Verizon will use OnCue, part of the Intel Media assets it acquired earlier this week. Colin sees them as key to upgrading the current FiOS service. I think that's right short-term, but longer-term I see Verizon using the assets to launch a nationwide virtual pay-TV services delivered over both wired and wireless networks. If Verizon does, it could really shake up the industry.

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This morning Verizon finally made official what has been rumored for months - its acquisition of Intel Media's assets, including its OnCue and its IP-based TV set-top box. With the deal (plus other recent acquisitions of upLynk and EdgeCast), Verizon is now well-positioned to launch an over-the-top pay-TV service outside of its FiOS footprint.

If and when it does so, then last week's net neutrality ruling takes on even higher importance, because incumbent cable operators/broadband ISPs would either have to allow Verizon's traffic through, unfettered, creating direct OTT competition for their core pay-TV services, or discriminate against Verizon, creating a perception of anti-competitiveness and no doubt, a PR firestorm.

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At CES this week, Sony announced an ambitious over-the-top pay-TV service that will launch sometime in 2014, making it the latest company to try competing with entrenched pay-TV operators. While Sony brings more assets to the table than did Intel (whose OnCue service never even got to market), the odds of Sony succeeding still seem extremely low to me.

To be fair, Sony's installed base of 25 million PlayStations, its early success with the PS4 and a broader base of connected TVs and Blu-ray players (which Sony says all total to 70 million in the U.S.) give the company a presence in homes that Intel didn't have. Sony also has both studio and TV production operations, plus a sizable back catalog, none of which Intel has. Importantly, Sony also has a well-recognized consumer brand (even if it's not exactly synonymous with innovation as, say, Apple's and Google's are), something Intel also didn't have.

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Reports surfaced last week that Intel Media's planned OTT pay-TV service "OnCue" has hit a major speed bump, and the company is now looking for potential partners such as Samsung or Amazon to help get the service launched.

I for one was not surprised by the news, as I've regarded Intel Media's pay-TV venture as facing extremely long odds. As well, I view the likelihood of Samsung, Amazon, or anyone else riding to Intel's rescue as being similarly improbable. Since Intel Media reportedly has had a 300-person team working on OnCue for almost 2 years, its potential demise would be an expensive lesson for the company in how hard it is to break into the pay-TV industry.

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Several weeks ago, after watching Intel Media chief Erik Huggers interviewed at the D: Dive Into Media Conference, I expressed skepticism that the company's marketing plan for its forthcoming pay-TV service would work. Huggers explained that Intel would emphasize a breakthrough, high-quality video experience, rather than a "value approach" where consumers could possibly save money by switching to Intel.

While I agree with Huggers that there's a lot left to be desired in today's pay-TV experience, the reality is that the industry's big players have set the tone for how consumers make their decisions to switch providers: price first, features second. The latest evidence of this was another Verizon mailer that arrived at my house last week (see below), offering a 2-year, $89.99/month bundle of video/broadband/voice and a $250 Visa card. Verizon will also bump the broadband speed to 50/25 mbps as a bonus.

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I'm pleased to present the 167th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. Today Colin and I assess the prospects for Intel Media's forthcoming over-the-top / pay-TV alternative service, which Erik Huggers described at this week's D: Dive Into Media conference.

Colin and I have very different perspectives on this. I believe that the ground rules of how major TV programmers negotiate their distribution deals (i.e. bundling disparate channels together) essentially eliminates the opportunity for pay-TV operators (or aspiring operators like Intel) to actually innovate with subscription packages. Further, by not addressing consumers' main problem with pay-TV, which is its high cost, Intel is going to have a hard time even getting 98% of consumers' attention in the first place.

Conversely, Colin believes that Erik wouldn't have been on stage at D unless he already had confidence he could get the kind of programming flexibility required to deliver on what he described. With that flexibility, Colin has faith that Intel can offer finer-grained packages, in turn delivering higher value to prospective consumers. However, absent more details, he's reluctant to be too optimistic.

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I attended the D: Dive Into Media conference earlier this week for the first time. It is mainly a series of one-on-one interviews with senior executives from a variety of media and technology companies, plus networking. Overall it was a great conference, and it's hard to beat a couple of days in beautiful Dana Point, CA, especially when coming off a blizzard in Boston.

My main interest was the video-related sessions, and from those I had 6 takeaways which I share below (along with selected session video clips), in no particular order:

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