2015 looks like a year for big changes in the pay television business. Yesterday, we heard about Dish’ Sling TV. Today, two cable operators announced they are looking to leverage the cloud to reshape their business.
Charter, the 4th largest cable provider in the US, announced that it would be shifting to a next-generation video solution, where a substantial proportion of the technical platform will be cloud based. This hybrid service combines traditional pay TV video with delivery of service elements over IP.
Two vendors will be providing a large part of the technical solution for Charter’s new service. Cisco will provide downloadable security for set-top boxes and digital rights management for IP delivery. Charter leverages ActiveVideo Networks’ Cloud TV solution to implement its next-generation Spectrum Guide in the cloud.
Charter will be following Comcast’s X1 service into the world of hybrid delivery. However, there are significant differences in the approach taken by Charter. For example, X1 requires a very modern, powerful set-top box to run the sophisticated guide software that is the hallmark of the service. Charter runs the Spectrum Guide – handling TV, VOD, and PVR functions – on cloud computing resources. That means the identical guide implementation runs on existing set-top boxes, and on Charter’s new Worldbox STB (some of which will also be provided by Cisco.) Cisco’s unified video security means Charter has a single solution, controllable from the cloud, which it can deploy across multiple vendor set-top boxes.
Kabel Deutschland announced it is developing a new video platform, in partnership with Cisco Systems, to provide a converged video solution in the cloud. The company wants to bring together broadcast, on-demand, catch-up and time-shifted television with Internet video to create a video-hub for the home. The selling point of this change for customers is that will provide a single place where they can go to find their video, regardless of where that video is delivered from.
No doubt the platform will make full use of Cisco’s Videoscape Cloud solutions. The company revealed at IBC last year its focus on virtualizing and orchestrating video workflows in the cloud. This ability is essential for operators as they move to modernize their existing business.
Though Kabel Deutschland’s approach has much in common with what Charter is looking to achieve, the German operator appears to be going a step further. The company clearly wants to work with web video providers so that customers can find their content through the video-hub, as well as content provided as part of the cable subscription. This raises the interesting question of whether Netflix, which launched in Germany last year, might be included with the video-hub.
For Charter and Kabel Deutschland this signals a firm commitment to move to an architecture capable of delivering new services and features at Internet speed. This is a radical shift for cable companies used to delivering new services on a schedule of years, not days and weeks. However, it is an essential step if pay TV services are to remain relevant and responsive to the Internet generation.
Why it matters
New approaches to pay TV delivery, as exemplified by Comcast X1 and Dish’s Sling TV, highlight how operators are starting to leverage IP delivery to modernize pay TV services.
Charter and Kabel Deutschland have announced similar approaches for their cable services.
Except to see many more operators move quickly to embrace the approach in order to remain feature competitive with peers and with native SVOD providers such as Amazon and Netflix.