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Morega Tackles Video Portability

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner
10/8/2012
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As operators start to shuttle on-demand and live video from set-top boxes to tablets and other connected devices, many are faced with this question: Do we build that capability ourselves or buy it from someone else?

One company that's squarely in the "buy it" camp is software startup Morega Systems Inc. The five-year-old company is led by Buddy Snow, a former Motorola Mobility executive who played a key role in developing Televation, a video transcoding device built in tandem with Comcast Corp. (Nasdaq: CMCSA, CMCSK) that the MSO markets under the AnyPlay brand. (See Comcast Uses TV Streamer to Pump Mobile Bundles and Comcast Beams Live TV to the iPad.)

Morega's mission in life is fairly simple -- to provide service providers and consumer electronics (CE) companies with the technology they need to port premium video securely to devices other than the set-top box.

The company doesn't consider itself in the same category as TV Everywhere, which generally is about helping authenticated pay-TV customers access video from the proverbial cloud. Instead, it sees its role as providing Slingbox-like functionality to service providers, enabling streaming video and the transferring of files (sometimes called "sideloading") from a set-top or gateway to any screen inside or, if the rights allow, outside the home.

"The easiest thing to get acceptance for is streaming or sideloading in the house. When you go outside the house, it's a different ballgame," says Snow, who joined Morega in April. "Remote access is the killer app, and I think they [the service providers] can charge for it."

Using a combination of client software that talks to servers on the network, a good portion of Morega's role is to adjust the video format for devices being targeted. But it goes a step deeper, helping service providers keep that link secure by authorizing which devices are allowed to access premium content from the set-top or gateway.

On top of that, Morega also helps to manage more complicated tasks that operators must take care of when extending their linear TV service to other devices, including support for closed captioning and the emergency alert system (EAS).

Snow thinks that process will become increasingly important as MSOs begin to offer set-tops with integrated transcoding abilities, and customers continue to use tablets and smartphones as secondary screens in the home and as primary screens when they are on the go.

Morega's first public customer is DirecTV Group Inc. (NYSE: DTV), which is using the vendor's software for Nomad, a $149 device that lets customers port movies and TV shows recorded on a DVR to PCs, smartphones and tablets, but doesn't enable streaming of live TV to other devices, at least not yet. The company also has two unnamed customers in Europe -- a "large" telco and a TV manufacturer that will let users stream content from the TV to client devices. (See DirecTV Unveils Content 'Nomad' .)

Build or buy?
Much of Morega's competition comes from in-house efforts by service providers as well as retail from Sling Media Inc. and Simple.TV. It'll also have to contend with TiVo Inc. (Nasdaq: TIVO), which is pitching its new Stream devices at retail and in partnership with MSO partners. Yet another budding service provider option is Broadcom Corp. (Nasdaq: BRCM), which is in the process of integrating Sling's video place-shifting platform into the BCM7425, a dual-tuner HD gateway chipset. (See Suddenlink Promotes the TiVo Stream , When Will Cable Turn Up TiVo Stream? and Broadcom Video Gateway SoC Gets 'SlingLoaded' .)

But Snow thinks Morega, with its licensing and integration model, can help pay-TV operators get complicated video portability services off the ground faster and less expensively than they can in-house.

Morega, which has completed integration with middleware players such as NDS (now part of Cisco Systems Inc. (Nasdaq: CSCO), will be making its cable pitch at next week's Society of Cable Telecommunications Engineers (SCTE) Cable-Tec Expo in Orlando.

Founded in 2007, Toronto-based Morega has about 60 employees and has secured two rounds of funding. Snow predicts that Morega should start to turn a profit in the next 12 months or so.

— Jeff Baumgartner, Site Editor, Light Reading Cable

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