Video services

Verizon Broadcasts Its TV Visions

Verizon Communications Inc. (NYSE: VZ) director of product development and management for video services, Joseph Ambeault, outlined the carrier's wish list for developments in the TV services sector, during a keynote speech Wednesday at the Connections conference organized by analyst firm Parks Associates .

It's a pretty ambitious list, too. For example, Verizon wants to see user-based licensing take hold, something that would allow users to consume content anywhere. Essentially, said Ambeault, Verizon wants the TV sector to avoid the content consumption and protection issues that have affected the music industry.

Along similar lines, Verizon expects to have to support multiple business models, including outright purchases, rentals, and advertising-supported deliverables.

Ambeault also talked about the need for a new advertising marketplace to emerge around new video services like FiOS and IPTV.

"Advertising -- it's just clear from the Internet -- has to play a bigger role in video [service delivery]," said Ambeault. As a business, video collects $70 billion to $75 billion per year in purchases, subscriptions, and rentals, but only $50 billion to $60 billion from advertising, he said.

But there's more to it than the numbers. Advertising isn't taking full advantage of all the possibilities offered by video, especially regarding the promotion of available video content, so it's important for video search queries to return pictures and clips as well as text, he noted.

FiOS already enables that, even when the end user has an underpowered set-top box. "I have boxes with 128 MBytes of RAM. There are cellphones with more than that." The key to delivering multimedia feeds is having a low-latency network: That lets miniscule set-tops render fancy-pants graphics "drawn" by servers elsewhere.

It's like (oh no... here it comes) a cloud approach -- Verizon makes the network do all the work.

Targeted advertising is going to have a role in the future of TV services, too, but Verizon doesn't want to give consumer groups an excuse to assemble any torch-burning mobs. Ambeault also said Verizon doesn't want to follow the example of cable's Canoe effort, which was started in secret. (See Canoe Ventures LLC and Who's Rowing 'Project Canoe'? .)

The problem, Ambeault said, is that while consumers seem resigned to being tracked on the Web, they're suspicious of any effort to track their TV content consumption, according to surveys Verizon has conducted. "We don't want to violate that trust. That's why we're taking a very slow and sometimes very public approach."

— Craig Matsumoto, West Coast Editor, Light Reading

paolo.franzoi 12/5/2012 | 4:03:25 PM
re: Verizon Broadcasts Its TV Visions



I think it is a bit unfair to not describe the issue with the model as described.

Owning the CD and doing what you wanted with it was okay because:

a - copying it was a pain and distributing it was more of a pain

b - so that this inherently limited the pirated market for music and video

The Internet and P2P basically eliminated all the pain around infinite copying and distribution.  So, theoretically one could buy a CD, load it, distribute it on the Internet for free for all.  So, the breakdown is that at that point only 1 copy of a piece of content is ever paid for (theoretically).  The result of this will be the elimination of people making content.  That is bad for everyone.

Gaming companies (in my mind) are at the forefront of dealing with this via license keys.  I think they do a lot better job than either the music or the video business in this regard, and I suspect there is a less interactive model for the video and music business that could be created.



Pete Baldwin 12/5/2012 | 4:03:25 PM
re: Verizon Broadcasts Its TV Visions

About the user-based licensing... Ambreault put it this way.  In the (pre-DRM) CD model of music, you own the CD and do whatever you want with it.  But if the CD breaks, you're out of luck.

I think what he's envisioning with video is along those lines, except if something "breaks" (corrupted download, fried hard drive) you can re-download it.  Then you'd have free ownership (free as in free speech, not free beer) either permanently or on a rental basis.

Sounds fine to me.  But even as big as Verizon is (or AT&T) - do they hold enough sway with the entertainment industry to get anything going in this direction?

Pete Baldwin 12/5/2012 | 4:03:24 PM
re: Verizon Broadcasts Its TV Visions

Good point about piracy, seven.  Part of what I think Ambreault was saying, though, was that the video industry can't use the same tactics the music industry did when it comes to piracy.  Multiple times he mentioned how it's important to "not become the music industry."

I'm not familiar with gaming licenses, but it wouldn't surprise me if they're at the forefront of new models.  They've got piracy issues too but don't have the big, lumbering conglomerates trying to preserve decades-old businesses.

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