Tru2way Glass: Half Full or Half Empty?
Right. So, just to keep that tru2way itch sufficiently scratched, there's a new forecast out today from ABI Research predicting that half of U.S. cable subs will have a set-top based on tru2way (née OpenCable Platform) by 2013. (See ABI: tru2way to Dominate by '13.) Based on the most recent National Cable & Telecommunications Association (NCTA) stats, there are about 65.1 million basic cable subs, so half of that is 32.55 million. Yes, even I can handle rudimentary mathematics without calculator aid.
Of course, some "interactive" Plug & Play digital TVs will also come with tru2way on-board, but it's fairly clear where most of the action is going to happen in the near term. So, again, let's hold off on all that death-of-the-set-top-box talk for at least a couple more weeks, shall we? (See The Death of the Set-Top Box? )
But not all will be fine and dandy, ABI says, pointing out that vendors are not thrilled with the added costs they'll be required to pay to add tru2way. Fair enough. It won't be free, that's for sure, when you factor in licenses and testing fees. But, the report adds, vendors are also complaining that "many cable operators aren't even deploying these systems." Well, it depends on how one tallies cable operators.
According to that "binding" tru2way memorandum of understanding (MOU) negotiated by Sony Corp. (NYSE: SNE) and the nation's six-largest cable MSOs, which together represent 80 percent of all U.S. cable subs, there will be plenty of deployments to prime the pump. Five of those six operators have agreed to have tru2way wired up by July 1, 2009. Charter has another full year to fulfill its commitment. I'll grant that MSOs beyond the top six haven't signed the MOU yet, so there's plenty of headroom left. (See Revealed: The Tru2way MOU.)
ABI is also bent because operators are "not willing to tell the market (or developers) how many boxes they expect to ship over time."
Really? The MOU offers some guidance here, too. Those "founding" MSOs have agreed to put tru2way middleware in 20 percent of new set-tops and other "interactive navigation devices" they purchase after July 1, 2009. Then again, all bets will be off if certain conditions of the MOU's "sunset" clause are triggered.
However, I do believe ABI is correct in its assumption of what is likely to be the biggest challenge for tru2way: industry-wide interoperability and the ability for developers to "write-once/deploy everywhere" without having to make significant tweaks to the code of their tru2way-based applications. The issues Panasonic Corp. (NYSE: PC) reportedly ran into when it last tried to gain certification clearly demonstrate that this won't be a slam dunk by any stretch. (See Tru2way Troubles?)
Despite those niggles, sizable that they are, it was clear at The Cable Show last month in New Orleans that tru2way is high on cable's agenda and that the majors are committed to this thing. In case you missed it earlier, here was our video report on the subject:
— Jeff Baumgartner, Site Editor, Cable Digital News