by Carol WilsonJanuary 3rd, 2008
The Netflix-LG announcement today is just one more sign of what’s coming in the video competition wars. As we head into CES, we can expect a lot more news of this type. Netflix is planning to stream movies directly into LG High-Definition television sets, bypassing any existing service providers with its video content, which includes thousands of movies and TV titles.
While telcos are moving as fast as they can — note the qualification there — to deliver video services, the current sellers of video content are going to stand still and watch their market disappear. Just as AT&T will try to exploit IPTV to make its U-verse service all-encompassing, consumer electronics makers and content distributors will capitalize on the ubiquity of the Internet to extend their reach as well.
The result is likely to be a much more fragmented video entertainment market than already exists today. Cable companies and telephone companies won’t be able to take for granted the appeal of their video-on-demand services, and they are going to have to work harder to sell all the extras and add-ons that many of them are developing now.
Services like the ones Netflix and LG are promising to offer will have greater appeal to a younger audience that glommed onto Netflix first and is already doing much of its video viewing over the Internet. Telcos and cablecos will have to work harder to convince the members of this crowd that they want to pay a major monthly fee and sign two-year contracts for services.
Related Topics: All Stories, Broadband/FTTX, IPTV |
by Carol WilsonDecember 14th, 2007
Well, there’s a shock.
A new Nielsen Media survey shows younger viewers are more likely to use digital video recorders or the Internet to catch up on shows they missed than those over 55.
I hope no one paid too much for that insight. The numbers show those under 35 are slightly more likely (37%) to watch a show on a DVR than those ages 35 to 54 (30%) but significantly more likely to catch up on the Internet (16%) than their elders (5%).
The real dropoff in technology usage comes at age 55. Those over that age are much more likely to wait for a rerun (35%) or just watch the next show (20%) than to use a DVR (18%).
None of this is surprising, but it does speak to the need for video service providers to make their technologies easier to use. I suspect older viewers would be happy to watch their shows on their own time, if they could only figure out how. There is a lot of disposable income sitting in the pockets of these older viewers, and for all the focus on the youth market, someone should be smart enough to tap that money pit.
Related Topics: All Stories, Broadband/FTTX, IPTV |
by Carol WilsonDecember 13th, 2007
The city of Philadelphia can be generally credited with launching the muni Wi-Fi craze, and is now seeing the down side of that trend. Earlier this week, the City Council held a hearing at which the status of its ambitious municipal network was examined, given the fact that the service provider, EarthLink, has stated it will no longer invest in municipal wireless networks.
EarthLink’s grand plans have run afoul of business realities, and nowhere is that more evident than in Philadelphia. The company said it has spent $20 million to build out Philadelphia’s network, which is still substantial but not complete, more than the $12 million to $15 million expected. The original contract between EarthLink and the city and its Wireless Philadelphia not-for-profit organization was hopelessly one-sided. As noted by the MuniWireless Web site, EarthLink is expected to pay $2 million to the city, $450,000 in inspection fees and rental fees of $2 per month for each streetlight used in mounting antennas, along with 3700 free accounts for city workers to access the network. The contract also calls for 23 free zones and 25,000 reduced price accounts for low-income families that qualify in WP’s digital inclusion program.
All of that, on top of the higher-than-expected cost of actually installing Wi-Fi citywide leaves EarthLink in no position to do anything but bleed red ink. Subscribership is not likely to cover those costs any time soon, if ever. The company did not attend the hearing, sending an unsigned statement claiming confidentiality, but it’s obvious that EarthLink is between a rock and a hard place here.
In a report also issued this week, the New America Foundation blames Wireless Philadelphia for handing its network over to a private concern. I didn’t read the whole report, but here’s a blogger who did and takes issue with it, for reasons I understand.
Rather than parsing out blame, however, it seems to be that some reasonable re-negotiation needs to take place that doesn’t leave Philadelphia’s ambitious plans for bridging the digital divide in limbo but also doesn’t bankrupt the company attempting to make those dreams a reality. The municipal Wi-Fi market has come a long way and much has been learned – the hard way – in the process. Philadelphia pioneered once, and it could do so again.
Related Topics: All Stories, Broadband/FTTX, WiMAX, Wireless |
by Sarah ReedyDecember 13th, 2007
I practically have RCN’s phone number memorized. When my bill was mysteriously doubled, I had to redial the cable company so many times after being hung up on that it is etched in my brain, right next to the hold music I heard for an hour each time. I even considered canceling my service, which is why I’m convinced that if a company – be it a cableco, telco, wireless carrier or Internet provider – had a solid customer service experience (not to mention allowed consumers to bypass those pesky automated menus), they would dominate the market. Customer service is paramount, arguably more so than the speed of a network, the features of a cell phone or the number of high-definition channels offered via IPTV.
At least 5,000 consumers agree with me. Forrester Research recently announced its Customer Experience Index (CxPi) for 112 firms spanning nine industries. Making up the lower echelon of the list were wireless carriers, television and Internet providers – sad news for the telecom space. In terms of usefulness, usability, and enjoyability, 5,000 consumers surveyed dubbed them failing to perform.
Perhaps even more surprising was that wireless carriers, coming in fifth, beat out TV and Internet providers. Internet providers came in third to last on the list of nine and TV service providers followed, beating out only medical insurance providers (at least they can claim that). Still, it is a dismal state of affairs when your TV brings you less joy than your phone, which in turn is also failing to live up to your expectations. I don’t think we can blame the Writer’s Guild for this one.
So, the question remains: Are consumers demanding more or is the industry delivering less? The answer may well be both. Forrester analyst Bruce Temkin, who conducted the survey, said that to some degree, the carrier and service providers tend to focus a lot on their products and the protection of their territories rather than on the needs of their customers. It can be a double-edged sword as service providers get caught up offering the latest advancements to attract customers, yet overlook the customers they already have. On the flip side, as customers hear more and more about the capabilities of IPTV, mobile handsets and the Internet, they come to expect the technologies to work more quickly, efficiently and right now.
A ray of hope from the Forrester study for telcos is that they were not included in the television space. With consumers so displeased with the eight satellite and cable companies included in the survey, a significant opportunity exists for telecom providers to differentiate themselves based on their quality of experience in this space.
And it’s not just a North American phenomenon. Increasing customer dissatisfaction is leading to higher churn in the UK as well. The solution may come from a better product or more likely from simply communicating the utility of a product, how to use it and enjoy it through stronger customer service. In terms of the overall worldwide customer experience, it might just be the one thing that service providers can’t substitute for faster speeds, cheaper prices or technological innovation.
Related Topics: All Stories, Broadband/FTTX, VoIP, Wireless |
by Carol WilsonDecember 6th, 2007
It’s clear there’s a battle brewing over whether service providers can legally filter content, whether it is to prevent piracy, protect applications such as voice and video or keep peer-to-peer traffic from swamping the network. There are multiple approaches to doing this today and more on the way.
Dan Glickman, chairman and CEO of the Motion Pictures Association of America told UBS’s 35th annual Global Media and Communications Conference that his organization is working directly with ISPs and with its own technical arm, Movie Labs, to develop and deploy technology that can detect illegal usage of copyright-protected material. Glickman singled out AT&T as one company with whom the MPAA is working, but also said other ISPs are on the list.
“My prediction is the ISP community is going to be at the forefront of this – they have everything to lose and nothing to gain by not seeing that content is being properly protected,” Glickman said.
Understandably, this has some folks’ shorts in a twist. You can read what Broadband Reports and Ars Technia said.
What most of the reports of Glickman’s speech failed to pick up on, however, were the other ways in which the MPAA is working to stop piracy of copyrighted content. One of those is education, he said – working with schools to explain to a tech-savvy generation why stealing content is a bad idea.
And another is working with its members to “find new ways to deliver content at reasonable prices,” Glickman said. That is especially important for younger viewers, he added, who are looking to get content in new forms other than at the movie theater or on traditional TV.
To the extent the MPAA and content distributors develop a good business model for achieving that latter goal, they could go a long way to address casual piracy by otherwise law-abiding citizens. And that’s something to which no one can object.
Related Topics: All Stories, Broadband/FTTX, IPTV, Regulation |
