Verizon Takes FiOS TV to the Xbox

Verizon Communications Inc. (NYSE: VZ) is set to offer 26 live TV channels and an array of video-on-demand (VoD) content via Microsoft Corp. (Nasdaq: MSFT)'s Xbox 360 next month.

While the offering is nowhere near Verizon's full selection of FiOS TV channels and content, it is a huge step forward for both the carrier's pay-TV franchise and Microsoft's popular gaming console.

Verizon will likely add more to the mix once it obtains the necessary rights to stream more channels to the Microsoft device over IP. At the start, it appears that Verizon's cleared to introduce more than two dozen cable channels tied to Viacom Inc. (NYSE: VIA), Walt Disney Co. (NYSE: DIS), Time Warner Inc. (NYSE: TWX), Scripps Networks and Turner Broadcasting System Inc. , and will include several popular networks such as MTV, Nickelodeon, ESPNews, Food Network, HBO and TBS. But it also means that FiOS TV's debut on the Xbox 360 won't include any of major broadcast TV networks.

In comparison, AT&T Inc. (NYSE: T) U-verse, which uses Microsoft Mediaroom, already replicates its pay-TV service on the console, turning the Xbox 360 into a full-fledged set-top. Comcast Corp. (Nasdaq: CMCSA, CMCSK) also has a deal in place to offer an app for the Xbox 360, but will start off only with access to a library of TV Everywhere VoD titles, meaning the user must also be an authenticated pay-TV customer to receive them.

Verizon said FiOS TV subs who also subscribe to the telco's high-speed Internet service and are Xbox LIVE Gold members will gain access to the new app sometime next month. The next Xbox Live update is set to go live on Tuesday, Dec. 6.

Verizon's already taking pre-orders online, and priming the pump with a triple-play promotion that features FiOS TV, its symmetrical 35Mbit/s Internet tier and voice service for $89.99 a month. The deal, good through Jan. 21, 2012, also includes a one-year Xbox LIVE Gold subscription and a copy of the Xbox Halo: Combat Evolved Anniversary game.

Why this matters
There's more road to travel, but getting access to a subset of FiOS TV's linear lineup gets the Xbox 360 one step closer to fulfilling Microsoft's mission of having its console become the home's media entertainment hub. The debut will also test how well the Xbox 360's Kinect gesture-based system performs as a video navigation platform.

For Verizon and Comcast, the integration with the Xbox 360, with the potential for more hookups with consumer electronics devices, may keep the Federal Communications Commission (FCC) at bay as it considers slapping pay-TV providers with an AllVid mandate that would succeed the current CableCARD rules on separable security.

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— Jeff Baumgartner, Site Editor, Light Reading Cable

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