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Will Google Droid Up the Set-Top Box?

While much of Google (Nasdaq: GOOG)'s $12.5 billion deal for Motorola Mobility LLC has centered on mobile devices and patent protection, the buy may also help Google bridge Android to a set-top world that's been under the tight control of cable operators and other video service providers. (See Google Buying Moto Mobility for $12.5B and Google Plays Favorites With Moto Buy.)

Most analysts agree that Google's timing for Android couldn't be better as MSOs start to migrate to IP-based video platforms and more capable set-tops and gateways, but they question whether MSOs will want to play ball with Google, even if it becomes a corporate cousin to one of the cable industry's biggest suppliers.

The Android OS and app market could help cable unclog its set-top software and applications bottleneck and help MSOs innovate in an area where platforms such as tru2way have not, says Imran Shah, managing partner at Interactive Broadband Consulting Group LLC (IBB) , a firm that counts Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Time Warner Cable Inc. (NYSE: TWC) among its clients. (See Tru2way: Epic Fail at Retail.)

"The software environment is wide open" as cable operators launch their IP video migration plans and start to mix in IP-only boxes as well as hybrid QAM/IP video gateways, Shah says. "The timing is really good if Google can play it right."

But to make it work, he thinks Google, in conjunction with Motorola Mobility, must do a better job working with MSOs if it's to have success integrating navigation and search apps that must be tightly coupled with an operator's pay-TV service, rather than focusing on lighter, widget-like "over-the-top" apps that it's been using on the Google TV platform.

"To really add value, Google must have a deeper integration with the cable [operators]," Shah adds.

Teresa Mastrangelo, Infonetics Research Inc. directing analyst, video, agrees that Android has a more direct path into the cable set-top box world as MSOs enter the early phase of next-gen box deployments. "It would open up a completely different type of experience," she says.

Android courts cable
Alticast Corp. has been pitching the Android option to cable operators for a while. In January at the Consumer Electronics Show, the set-top software specialist demonstrated a set-top box equipped with dual tru2way and Android stacks. Alticast's idea was to help MSOs preserve their tru2way middleware and apps (in this case, guides, video-on-demand clients and a few widgets) investments while also giving them access to the much larger and open Android marketplace. (See CES 2011: Alticast's Android Angle.)

So far, most of the traction for Android-in-the-set-top has occurred outside of North America, a market that's hindered by a massive legacy of older digital cable boxes that can't use Android, anyway.

Alticast developed its Android proof of concept for Korea Telecom. Mastrangelo notes that she's seen Huawei Technologies Co. Ltd. and ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) build Android boxes for the Chinese pay-TV market, and has seen some other, smaller set-top makers create Android products for pockets of Europe.

Would MSOs go for it?
Mastrangelo notes that MSO desire -- not Google's or Motorola's -- will determine whether Android stands a chance of gracing the cable boxes of the future. "It's unclear on how they [the MSOs] feel about it."

And at least one analyst doesn't give Android much of a fighting chance. Colin Dixon, senior partner at The Diffusion Group (TDG) , says MSOs have little interest in flipping their set-tops to Android or a Google TV-like environment anytime soon.

"Operators won't do it," he says. "They have enough different types of old boxes now. Operators want a single guide solution. If they start deploying Android STBs, they can't get to a single electronic guide."

And Google TV's lack of success hasn't exactly won it any cable fans. "There is negative interest in the cable companies for Google TV," he says. "If you want to kill a product line, put Google TV on the STBs. I don't think you'll find a single operator interested in it." (See Dish's Google TV Exclusive Will Be Brief , Google TV Guns for Cable Deals and Dish Still Serving Google TV .)

But Will Richmond, an online video analyst and founder of Broadband Directions LLC , says a Google TV-cable connection "has some appeal" for cable operators, noting that a tight integration could help MSOs bring the app model to the TV and perhaps give them a monthly revenue lift if they're able to charge extra for that capability.

— Jeff Baumgartner, Site Editor, Light Reading Cable

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Jeff Baumgartner 12/5/2012 | 4:56:09 PM
re: Will Google Droid Up the Set-Top Box?

As I poked through the transcript of this morning's call, it was pretty clear that the set-top piece of Motorola Mobility is almost an afterthought in terms of the near-term stragetic value Google sees when compared to the patent protection angle.


"I think there's an opportunity to accelerate innovation in the home business by working together with the cable and telco industry as we go through a transition to Internet protocol," Google CEO Larry Page said.


Later, in the Q&A, Moto Mobility Chairman & CEO Sanjay Jha also brought up the cable industry's IP transition and that "there is a great convergence happening between the mobile world and the content that enters the home through the set-top box."


So, it seems like  Android and Google TV on the set-top are playing into everyone's thinking, but it's not that high up on the near-term agenda. It's an opportunity, for sure, just not one that drove the deal by any means. JB


 

DCITDave 12/5/2012 | 4:56:09 PM
re: Will Google Droid Up the Set-Top Box?

I guess I missed it but what do all these analysts think Google will do to add $$ to the cable MSO bottom line?


Cable prices have been rising steadily for years and I doubt any consumer will suddenly think that changing set-top OS is worth yet another price hike.

kateschackai 12/5/2012 | 4:56:07 PM
re: Will Google Droid Up the Set-Top Box?

It might not be a matter of price hikes, but of intelligent revenue -- increasing the value of customers. Key to this approach will be innovative billing structures. See Convergys' Michelle Nowak: http://www.convergys.com/insights/guest/convergys-icoms-9-%E2%80%93-what-say-you-now-doomsayers/

paolo.franzoi 12/5/2012 | 4:56:06 PM
re: Will Google Droid Up the Set-Top Box?

 


Why Android and not Chrome OS Jeff?


 


seven


 

Jeff Baumgartner 12/5/2012 | 4:56:04 PM
re: Will Google Droid Up the Set-Top Box?

Until you mentioned Chrome  here on the boards, I didn't really think of it as an option and it didn't come up in my conversations. I think most of use were focused on Google TV and Android OS and app market, and didn't put Chrome up there as a possibility. But given all of this movement into the cloud, perhaps we overlooked that. Do you think Chrome would make a better fit for the STB environment? JB

comtech3 12/5/2012 | 4:56:03 PM
re: Will Google Droid Up the Set-Top Box?

Please enlighten me,but  was the set-top business a part of the sale agreement between Google and Motorola? I see where some of the respondence here have stated that MSO would want Android/Chrome incorporated in their set-top boxes,but we all must bear in mind the these two names are in a sense just semantics because the underlying middleware in  almost all set-top boxes  uses the Java programming language.We all should know that neither Chrome nor Android are UNIX derivatives,but the Java programming language itself.


So, to add Chrome, or Android to a set-top, would not be anything new,but an enhancement to its middleware features.The fact that Google TV did not take off was(is) as a result to two fundemental reasons.(1) Poor adverstising (2) Bad timing. Very few consumers were aware of Google TV in both formats that it came out in, Logitech Revu,and the Sony TV.Bad time as a result of greater consumer focus on tablets,which brought about a desire not to be tied to their TV in one place.


I just bought a Sony 24 inch Google TV, and I tell you the concept is great,except for a few minor improvements that can be made over time.The keyboard that comes with the set is not for those with big hands, or for people who are colour blind like me.The single Chrome brower has you trapped if it fails.One should at lease have an alternate browser such as Firefox built in.


Overall, the features are great, especially the 802 11N wireless that is standard.Other stuff includes a built-in QAM tuner. This TV is basically an " all you can eat" concept that can be grand fathered into new set-top boxes.But on the other hand, with a TV like this, who needs a set-top box anyway?


 

comtech3 12/5/2012 | 4:56:02 PM
re: Will Google Droid Up the Set-Top Box?

My statement should read that most MSOs would not want Android/Chrome incorporated in their set-top boxes.

yaronwar 12/5/2012 | 4:55:58 PM
re: Will Google Droid Up the Set-Top Box?

I know this is speculation, but dont forget that Vincent Dureau who is Head of TV Technology at Google was the co-founder and CTO of OpenTV. So he knows a thing, or two, about the STB world and OS for STBs. He done it once, he can do it again...

BillShepp 12/5/2012 | 4:55:58 PM
re: Will Google Droid Up the Set-Top Box?

Chrome makes little sense for the STB.  It's a browser-based, enterprise-focused environment, whereas STB's need tons of things going on "under the covers" to support the myriad components within the box which make everything work.

Jeff Baumgartner 12/5/2012 | 4:55:57 PM
re: Will Google Droid Up the Set-Top Box?

Hey, a little speculation and discussion is healthy, i think, especially since Google has not given any indication that it actually has a strategy beyond the patent protection MMI gives them. But good of you to bring up Vincent... he's seen the good, bad and ugly of the cable STB world, going back to when we were still calling tru2way the OCAP and we were all chatting up what vendors, including OpenTV, were involved in its presentation and execution engines. So I agree... he can give Google a pretty good lay of the land and point out where the landmines are. JB


 

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