CES: Pay-TV Services – Threats and Competition

by Parks Associates | Feb. 1, 2013

By Kurt Scherf, Contributor

CES isn’t necessarily the show at which major pay-TV providers (cable, satellite, or IPTV) make announcements, but as consumer electronics becoming important complements or replacements to the set-top box or pay-TV altogether, the show serves as an increasingly important way for these providers to demonstrate their continued relevance.

The pay-TV market is under significant threat from alternative sources of entertainment and content, whether it is online (Netflix and Hulu) or over-the-air. One significant company is called Aereo, and it allows users to watch OTA programming from Internet-connected devices. Service began in New York City, but Aereo announced on January 8 that it was expanding to 22 new markets. Much more closer to home, Marion, Iowa-based Syncbak announced prior to CES that 100 broadcasters in 70 markets use or are testing Syncbak’s OTT mobile platform to bring OTA content to mobile devices.

To compete against the lure of Netflix taking customers away from subscription television services, AT&T become the latest operator to launch a streaming video service called Screen Pack. At $5 per month, this service gives U-Verse customers unlimited streaming of about 1,500 movies and television shows. As The Wall Street Journal reported, AT&T joins Comcast, DISH Network, and Verizon to also offer streaming video services.

As with the case of the consumer electronics manufacturers, pay-TV providers are working on their own second-screen experiences to bridge between the television and the mobile environments. For example, Cox Communications announced that it was working with Cisco to launch an app to provide subscribers with up to 90 live channels and on-demand programming on mobile devices, in addition to allowing the mobile device to serve as a remote controller. The cable industry is also trying to promote more advanced features, such as those included in Comcast’s X1 service, recently launched in Philadelphia. This service touts such features as enhanced and quicker search capabilities, the ability to use your smartphone as a remote controller, and the integration of web applications.

Some pay-TV hardware got attention at CES, including a new gateway from Arris with Intel technology. This gateway promotes a great many features, including support of very high-speed broadband (up to 1 Gbps), multiple channel transcoding, HD Voice, and home automation features. The piece of hardware that got the biggest attention at CES, however, was the upgraded Hopper DVR from DISH Network. The set-top box offers Sling technology to push live TV or recorded programs to Internet-connected devices, the ability to move recorded programs to an iPad for offline viewing, and support for a tablet app that provides for content discovery and remote control functionality. The Hopper DVR ran into some controversy at CES when CNET, a technology news site, selected the product for its “Best of CES” prize but was forced by its parent company – CBS – to pull the prize due to ongoing litigation it has with DISH Network over an ad-skipping feature of the Hopper.

Enhancements to how pay-TV providers can provide more accurate and personalized recommendations to viewers also headlined CES announcements. Both Cox Communications and Time Warner Cable made announcements either right before or during the show with technology providers Digitalsmiths, Jinni, and ThinkAnalytics.

Kurt Scherf, Contributor, has attended 13 out of the last 14 Consumer Electronics Shows in Las Vegas and tracked the news and developments remotely this year. According to the Consumer Electronics Association, the 2013 CES was the largest in terms of physical space (1.92 million square feet), with attendance of more than 150,000, with 35,000 people from 170 countries outside the U.S. While plenty of column space was dedicated to the companies that weren’t in attendance in an official capacity (Amazon, Apple, Microsoft, and Research In Motion, to name a few), there is always enough excitement in the new year about consumer electronics developments to cover.  

Next: CES: Tablets vs PCs
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