Light Reading

Comcast, Verizon Connect With the Xbox 360

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner

Microsoft Corp. (Nasdaq: MSFT)'s plan to turn the Xbox 360 into a streaming video hub took an expected step forward Tuesday with word that Comcast Corp. (Nasdaq: CMCSA, CMCSK) will pipe video on-demand (VoD) to the console, and Verizon Communications Inc. (NYSE: VZ) will take it further by delivering VoD and a subset of its live TV lineup.

And it's not for the cord-cutting crowd, as access will be limited to Xbox 360 users who are authenticated Comcast and Verizon pay-TV subs and subscribe to the $60-per-year Xbox Live Gold service. Mediaroom IPTV customers AT&T Inc. (NYSE: T) and Telus Corp. (NYSE: TU; Toronto: T), meanwhile, already offer their full-fledged TV services on the Xbox 360. (See Xbox 360 Joins the U-verse Lineup and Telus Turns Xbox 360 Into a Set-Top.)

Comcast EVP and CTO Tony Werner noted on the MSO's blog that the Xfinity On-Demand service will become available on the console "in the coming months." A Comcast spokeswoman said "thousands" of VoD titles will be offered on the Xbox 360, though that number will consist of a portion of the 30,000 VoD "choices" that Comcast customers get today through a traditional set-top box. Comcast hasn't committed to offering live TV on the Xbox 360 yet, but the MSO expects its offering on the device to "evolve in time."

Verizon's initial Xbox 360 play will couple VoD with access to 26 live TV channels, including CNN, Nickelodeon, MTV and Comedy Central.

Both Comcast and Verizon's video integrations will let Xbox 360 users navigate content with the device's integrated, gesture-based Kinect system, and both operators will deliver content to the box over managed IP links.

In all, Microsoft said the next generation of its Xbox Live service, to be out by the 2011 holiday season, will work with almost 40 TV and entertainment channels and service providers including HBO Go, Epix, Bravo, Spike, Telefónica SA (NYSE: TEF) in Spain, Rogers Communications Inc. (Toronto: RCI) in Canada (for VoD), Televisa in Mexico, ZDF in Germany and MediaSet in Italy.

Why this matters
For Microsoft, it's a step toward turning the Xbox 360 into a central home entertainment hub, though these initial implementations with two major pay-TV providers represent just a portion of their full-blown pay-TV service offerings.

For Verizon and Comcast, it gets their services more intertwined with the consumer electronics ecosystem and comes into play amid the threat of new AllVid rules that they'd just as soon avoid. Both service providers have also been making strides to offer video services on other broadband-connected devices, including iPads and TVs.

For more
Read more about the Xbox's video ambitions and some of cable's recent CE moves.

— Jeff Baumgartner, Site Editor, Light Reading Cable

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Jeff Baumgartner
Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 4:51:52 PM
re: Comcast, Verizon Connect With the Xbox 360

So, the Xbox 360 is essentially getting a nice bite of authenticated TV Everywhere content, but not the whole pay-TV meal. 

It's start, but we'll soon be seeing alot more of this sort of thing as the holiday season approaches -- connected TVs, other  consoles and specialized boxes (Roku seems like a great candidate) will also get access to the same thing -- a piece of the whole.  Microsoft's differentiator , if it should be thought of as one, will be fleeting and become table stakes for everyone else.

  I'm still struggling a bit about what the use case is here even if these sort of deals add some value to a device like the Xbox360. MSFT  wants the Xbox 360 to be the primary entertainment device in the home, but it can't be if it can't access everything that a traditional set-top box can.  Maybe things will truly "evolve" and that might actually happen once Comcast, Verizon and more service providers get further along with their IP video migrations, particularly for linear TV. JB

User Rank: Blogger
12/5/2012 | 4:51:50 PM
re: Comcast, Verizon Connect With the Xbox 360

There's a comment thread going on over at ZNF that brought up another angle here I hadn't considered. It's still niche from a business perspective, but it looks like HBO customers may get their first lean-back experience with HBO Go via the Xbox. Assuming the PQ is decent (better than on a mobile device), subscribers suddenly get access to a large back catalog of HBO content that isn't available on-demand for your TV anywhere else. 

I've always been of the opinion that people would pay for back catalogs, but that volume of content is something VOD just hasn't been able to support. IP changes that.

User Rank: Light Beer
12/5/2012 | 4:51:50 PM
re: Comcast, Verizon Connect With the Xbox 360

Another way of looking at this is from MSFT's perspective: Adding these and other capabilities extends the life of the 360 platform, changing its "tail,"  as Xbox blogger Major Nelson explains: Exactly how many of the 35m Xbox Live subs are Gold (most?) and how many of them get video from Fios or Xfinity? Dunno. But marketing at VZ and CMCSK surely have run numbers, whch likely make sense from their sides.

Jeff Baumgartner
Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 4:51:49 PM
re: Comcast, Verizon Connect With the Xbox 360

That's a good point.. HBO Go on the TV does provide a lot of value because you get a lot more than you do on traditional cable VoD. I hadn't thought of that, but it makes sense... HBO Go is about all I really watch on Comcast's Xfinity TV app on the iPad.  JB

User Rank: Light Beer
12/5/2012 | 4:51:48 PM
re: Comcast, Verizon Connect With the Xbox 360

Remains to be seen whether the content available on a programmer app (HBO Go or other) will be a superset of the content available through a pay TV providers VOD library - this is the case in the short term, but that could be a capacity issue w/ VOD libraries.  In addition to long tail libraries, this also creates alternatives for user interface - do consumers prefer to access content through an operators app, or directly through a programmers app?

User Rank: Light Beer
12/5/2012 | 4:51:45 PM
re: Comcast, Verizon Connect With the Xbox 360

... they should add a CableCARD module.  I may be a tad biased :-), but it would be relatively easy for MSFT to take the Ceton InfiniTV quad-tuner technology for example and do a CableCARD peripheral that would immediately give them a solution for all the 45+ million digital cable subs in the  US, not just the ones in Comcast and Verizon footprints.  Talk about a killer entertainment device -- all digital cable channels, 4 tuner DVR, tons of on demand, Netflix and of course gaming!

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