Written by John Antonchick, NCN Associates (June 30, 2011)

Moderator: Kurt Scherf, Parks
Panelists:
- Peter Ansel, Clearleap
- Ashish Arora, Logitech
- Michael Clegg, NETGEAR
- Keith O’Neill, L4 Media
- Derrick Oien, chumby

Kurt initiated the session and discussion by suggesting that transactional online video revenues through connected TV devices could be a $5 billion business in five years. Beyond online video, what are the applications that add value to the device/service and service providers.

Peter said they are a 3 year old startup focusing on streaming video while working with service providers; mainly using QAM video. Issues include what other types of services and applications users will access, e.g. Twitter and Skype. Service providers bundle and invoice these services. Clearleap works with the service providers to enable implementation of multiple services, e.g. how the IP interactive world will impact their subscribers and services.

Ashish from Logitech’s Digital Home Group was asked about what they have learned from their experience with Google TV. Ashish reviewed their view of the digital home, i.e. how people interact in with the digital home services, how they utilize social services, and how they manage the digital home. Today, their view is that many devices are being connected but there are also new ways to connect and interact with TVs. Google TV was oriented to bringing more content to the TV. Logitech was working with Intel and Google to promote open standards for these types of services, which is what appealed to Logitech. The user experience that resulted is good but there were and also are content use issues.

Michael from NETGEAR explained they have three lines of business, including a service provider business where they sell directly to service providers. Retail is an important indicator of consumer interest. The acceleration and adoption of internet/web technologies is happening and changing the traditional environment that has used OCAP, etc. The service providers have major investments in older technologies while there is a possible evolution either to transcoding or direct IP access in the cloud. They are also supplying “no new wires” IP connectivity for many devices, including an explosion in the use of WiFi. Their WiFi repeater sales have “gone through the roof” and enable access from many non-traditional locations. They support several communication types, e.g. MoCA, HomePlug, etc.

Keith from L4 Media (which also has a mobile division) targets personalized content with devices that complement the experience. Consumers are demanding personalization and Keith’s presentation emphasized the top applications and content sources on the internet, e.g. Netflix. As an example, they worked with Viacom to develop access to either of two video feeds to complement the main TV program. They also enable the user to access content that is relevant to the user’s interest and the context.

Derrick from chumby said they pioneered a new category of hardware that displays internet content using Flash and sold tens of thousands of units without marketing. People have used their chumbys for a variety of purposes. This resulted in a partnership with SONY for a SONY device and a “photo friends” product for Best Buy. Their business model has shifted to licensing hardware and providing professional services. Currently, they are working with PACE on set top boxes and are developing a TV design. They expect to grow the company by leveraging trends and are developing photo-frame and other in-home devices while supporting Android device designs.

Kurt asked why cable industry efforts to provide connectivity and interactivity, e.g. EBIF, seem to have failed. Peter suggested that operators have needed technology that would allow them to add services without replacing existing hardware in order to innovate. DOCSIS has enabled cable operators to provide a high quality pipe. They are now embracing IP but he feels that their main opportunity is not in replacing TV but in adding other types of applications. In any case, he thinks that operators will embrace IP as they did with DOCSIS. Michael suggested that service providers shouldn’t “fight the wave”. However, it didn’t make sense to try to run new applications on older analog set top boxes. He thinks we are now getting into the age where there will be devices with built-in capability to support standardized technologies.

Kurt posed the question of how the industry will enable advanced services when their networks and in-home devices don’t support those architectures. Ashish responded that the content providers are a key issue and they must develop a new business model. He also felt that there is serious fragmentation of the operating system for various CE processors and devices; and that this makes it difficult to scale usage. Finally, the user interface and interaction doesn’t support a “touch” experience. Derrick agreed that development is a challenge but noted that most suppliers are adding the same content services but there is no break-through value-added content or service.

Keith responded to the issues about open standards, experience, etc. with the comment that no one really knows what the applications are that need to be supported. In that sense, he thinks the cloud will be used for distribution to the service providers choice of user interfaces. Derrick suggested that browser-based applications, etc. perhaps using HTML5 may be appealing (and they are supporting it) but expect that there will be three or four semi-proprietary, different platforms, i.e. “Adobe”, “Android” and “Other” types of solutions. Ashish noted that Apple has already announced their OS for Apple TV, e.g. that their iPad OS can be scaled to the TV. An audience question was whether a browser-based application on large screen TVs is a solution. Derrick’s response was that the Netflix implementation on the PS3 is the best currently available solution but that this depends on capabilities in the PS3 processor that are not available in other devices.

Kurt asked about the role of an in-home vs. a cloud-based transcoding device. Michael suggested that the connected home is now implemented with a variety of different devices but he believes that the cloud is ultimately a better solution. However, today the service providers think of devices like set top boxes as the implementation of capabilities; and that service providers sell to everyone in the home. In this context, the “favorite” TV operation is channel up/channel down and noted that this is difficult to implement with a cloud-based paradigm. Peter indicated that most of their work is done in the cloud, e.g. the search interface. Kurt asked Peter how service providers could maintain their brand(s) on cloud-based devices. Peter’s response was that branding hardware devices would be unrealistic but that the service bundles provided will be the best option in the short-term for service providers. He used the example of the Boxee Box suggesting that this type of product would not be the first box supported by a (smaller) service provider.

Other Questions:
1) With the launch of Google Plus is the software going to be enabled on the Logitech platform? Ashish said this is an interesting addition and that they both want to support it as well as add other similar services, e.g. Skype. He said that Skype expects that 40 million devices will be enabled with Skype connect (soon) but that it must be a simple, one-click easy consumer solution.