Would-Be Over-the-Top MVPD Said to Aggressively Pursue Strategy
SANTA CLARA, Cal.-- Expect a new entrant to the pay-TV industry to bring an over-the-top (OTT) multichannel video programming distributor experience to market soon, SyncTV Chief Technology Officer John Gildred told the TV Next Conference Wednesday. “We're working on that for at least one customer who is very aggressive about that concept” and is in active negotiations with programmers to license the rights to provide live and on-demand TV, he said. “It’s in development and in negotiation today.” Content providers are more open to such arrangements than they have been, even as recently as a year ago, Gildred said.
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Some consumer electronics manufacturers are “dead serious” about being a virtual MVPD, Gildred said. Other panelists during a discussion about “next gen” pay-TV operators were skeptical of the idea. “Technically someone could launch an OTT service tomorrow,” said Jimshade Chaudhari, director of digital product management for Dish Network. “Will it happen? No, because the business model is not there.” Gildred was reluctant to put a time frame on when such a service might be introduced. Industry pundits have been predicting a virtual MVPD “within 18 months” for the past five years, he said.
Even as pay-TV networks like HBO begin to experiment with bypassing MVPDs and offering their content directly to subscribers overseas, pay-TV operators will still play a major role in the U.S., panelists said. Going over-the-top will be easier for some programmers in smaller European markets with a more homogenous and smaller population than in the U.S., said Louis Toth, a managing partner at Comcast Ventures, Comcast’s venture capital arm. Domestically, “there is, for lack of a better term, this cross subsidization for all these different networks” that lets subscribers enjoy both Disney’s ESPN and Viacom-owned Nickelodeon at affordable rates even if they're only watching one and not the other, he said.
Not every pay-TV network or program has the brand-recognition to succeed in an OTT environment, said Toth. “It depends on the power of the brand.” Even among “TV Everywhere” style apps that require a pay-TV subscription, not every cable network will have the brand power to drive usage, said Bob Van Orden, vice president-corporate and business development for Clearleap, a pay-TV technology and software vendor. For now, programmer-branded apps will probably dominate the TV Everywhere, or authenticated, platform, he said. But in time, “you will start to see more aggregated, branded operator experiences,” he said.