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Verizon to Stream After Netflix

Welcome to the cable news roundup, Hump Day edition.

  • Verizon Communications Inc. (NYSE: VZ) is preparing to launch a standalone streaming video service next year that will compete with Netflix Inc. (Nasdaq: NFLX) and allow the telco to offer subscription video services outside the FiOS TV footprint, reports Reuters, noting that Verizon is in the process of ironing out rights with programmers for a package that would be "limited in scope" and concentrate on content from premium content suppliers such as Starz Entertainment LLC and Epix. Dish Network LLC (Nasdaq: DISH) is expected to put together something similar under the Blockbuster Inc. brand. Comcast Corp. (Nasdaq: CMCSA, CMCSK), meanwhile, has questioned the economics of over-the-top video services. (See Comcast Won't Go Over the Top.)

  • Cablevision Systems Corp. (NYSE: CVC) and Verizon Communications Inc. (NYSE: VZ) are squabbling again. This time, Cablevision is suing Verizon in a New York court over claims that a FiOS Internet ad campaign misrepresents the speeds delivered by the MSO's cable modem service. Cablevision claims Verizon is still running ads that cite data from an old Federal Communications Commission (FCC) study despite the emergence of new results showing that Cablevision's average download speeds are in excess of 90 percent of advertised broadband speeds during peak hours, and are above 100 percent of advertised speeds on a 24-hour basis. The previous FCC report said Cablevision delivered about 50 percent of advertised speeds in peak hours and 80 percent over a 24-hour period.

  • DirecTV Group Inc. (NYSE: DTV) and TiVo Inc. (Nasdaq: TIVO) will try to make money together again on Thursday when the satellite giant introduces a TiVo-powered, broadband-capable HD-DVR that costs US$199, plus $12 per month, in several major markets, including Los Angeles, New York, Chicago and Philadelphia, with a national rollout expected early next year, notes Multichannel News. DirecTV is debuting the product soon after TiVo posted its first net subscriber gain in about four years, helped in part by aggressive rollouts from Virgin Media Inc. (Nasdaq: VMED). (See TiVo Ends Subscriber-Losing Streak .)

  • Canada's Shaw Communications Inc. has begun to test a new Wi-Fi network, noting that it will provide wireless access in parts of Vancouver, Calgary and Edmonton ahead of its wider, commercial launch next spring. Shaw cable modem subs can log in with their email address and password and can authenticate up to eight devices. Shaw, which is currently using Cisco Systems Inc. (Nasdaq: CSCO) access points, posted a map that tracks the deployment of its budding Wi-Fi hotspots. (See Shaw Launches Wi-Fi Test Net.)

  • Cablemás of Mexico is moving from its legacy video-on-demand (VoD) platform to one from Avail-TVN that uses adaptive bit-rate techniques that adjust streaming quality and resolution based on available bandwidth. Cablemás is starting off by pitching the new service to set-top boxes in 250,000 homes, with plans to extend access to PCs, tablets and smartphones later. Among other partners, Conax AS is providing security, Cubiware the middleware and Evolution Digital LLC kicking in the hybrid QAM/IP set-top boxes. (See Avail-TVN Brings TV Everywhere to Tier 2s .)

    — Jeff Baumgartner, Site Editor, Light Reading Cable



  • Jeff Baumgartner 12/5/2012 | 4:47:09 PM
    re: Verizon to Stream After Netflix

    VZ Pres. & CEO Lowell McAdam spoke at the UBS investors conference today and did some dancing around the OTT question:


    "I think the jury is out, but I do think there is a place for over-the-top here and it will be part of our strategy," he said, later acknowledging that he looked at Hulu as a potential alternative platform. "There is lots of speculation about what we are going ot do and what we are not going to do. That is speculation by people that like to write blogs."


    Or write on message boards.


    What does VZ need to do to make this OTT idea compelling and not become just a Netflix me-too?  I think it has to be heaps of on-demand plus live TV with a lot of a la carte and packaging potential to make it compelling. JB


     


     

    Jeff Baumgartner 12/5/2012 | 4:47:09 PM
    re: Verizon to Stream After Netflix

    While I realize that this is being viewed as a Netflix killer (hey, it's already a wounded animal), the out-of-footprint idea is compelling, and it's just the start.  I'll be curious to see how much and what kind of content VZ can pull together in the early going, and if it will include access to live TV channels.  At what point does everyone go over the top?  Not tomorrow... but as soon as the rights are secured. JB

    ethertype 12/5/2012 | 4:47:04 PM
    re: Verizon to Stream After Netflix

    OTT VoD is an interesting sideshow that will continue to attract lots of competitors and turn into a low margin business where content owners extract most of the revenue.  There's potentially lots of room for distributors to innovate in content mix, subscription model, device support, etc., but content owners are very carefully parceling out rights to ensure they don't leave any money on the table.


    The end game is live TV OTT, but since that will fully enable cord cutters, content owners will demand that it comes with a much higher subscription price than the current OTT VoD subscription services, so that they can replace a good chunk of the lost revenue from traditional subscriptions.


    What the content guys and MSO/IPTV/DBS crowd all want to say, but don't quite say, is:  "Fine:  you want to cut the cord AND still get live TV including sports and a great VoD catalog with lots of the latest releases?   Be prepared to pay $40-$100 just like a regular TV sub."

    Jeff Baumgartner 12/5/2012 | 4:47:02 PM
    re: Verizon to Stream After Netflix

    Some more evidence popped up that suggests VZ will indeed fire out with something that's Netflixian in nature. TechCrunch is rumoring that VZ is to partner with Redbox on the coming streaming product that ties into Redbox's Project Zoetrope initiative. JB


     


     

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