Cable's Web TV Approaches May Vary

Written by Jeff Baumgartner

Tuesday, February 24. 2009 at 09:20 AM EST Post a comment

Digg   Del.icio.us   Reddit   Email This

no ratings

• Login to Rate

Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Time Warner Cable Inc. (NYSE: TWC) are both in advanced discussions with major programmers that aim to give MSOs permission to offer more long-form fare via broadband to their current cable TV subs, but operators are likely to vary in the ways they make these options available.

Some may opt to develop standalone broadband video portals, while others could look to partner directly with programmer Websites and "authenticate" and "entitle" cable customers to access a wider swath of content. Others may end up doing a mix of these options. 

In these cases, authentication and entitlement are about managing video catalogues and instituting policies that ensure that consumers can access titles within those catalogues only if they have the rights to view them.

Among MSOs, Comcast has already acknowledged that it's drawing up a new, complementary, broadband-fed video play that carries the internal moniker of "On Demand Online." Comcast has not offered much detail about that product, but it's likely the operator will offer it as an extension to Fancast, the Comcast-owned Internet video hub that offers a menu of more than 44,000 video titles and counts Hulu LLC among its content partners.

Time Warner Cable has said very little about its future Web TV plans, but, if history is a gauge, it could look to partner with programmer Websites directly (as it does today with the HBO on Broadband offering), or develop a hybrid broadband video service that also ties in a more centralized portal. 

No matter the approach, MSOs will have to iron out ways to authenticate customers for these services and entitle them to the content that they have access to. Time Warner Cable, which is ramping up the availability of HBO on Broadband to millions of cable subs and has long held that its customers should only have to pay once for content no matter how or where it's accessed, has previously discussed the entitlement concept.

The entitlement system TWC uses today ties into the billing system to authenticate, authorize, and eventually provide access to the broadband offering -- so long as the customer uses the correct user name and password.

One company that could play a role in all of this is thePlatform Inc. , a media publishing firm owned by Comcast. ThePlatform, which already has broadband video management deals in place with Comcast, TWC, Cox Communications Inc. , and Cablevision Systems Corp. (NYSE: CVC), revealed in a blog post last Friday that it's involved in "building out the capabilities" for the types of cable Web TV services under discussion.

The company has also acknowledged that it's a key enabler for Comcast's On Demand Online project, which is expected to see the light of deployment later this year.

Ian Blaine, thePlatform's CEO, couldn't provide much more detail about its advanced work with cable operators, but he said "most" of the technology is already in place to make this happen. "We've done it one way or another for all kinds of content."

Today, most of the content served up by thePlatform is premium, professional fare -- exactly the kind of stuff that Comcast, TWC, and, presumably, other MSOs are expected to serve up via their new Web video strategies.

According to comScore Inc. data, thePlatform's clients had a combined total of more than 440 million video views in December 2008. 

"Consumption is definitely going up," Blaine says.

And it's that trend that has grabbed the attention of operators, which are eager to preserve their traditional video subscription business models. Although there's only anecdotal and experimental evidence of this so far, MSOs are growing more and more sensitive to the concept of "cord-cutting," whereby cable customers drop their TV subscriptions but retain their high-speed Internet services to access video via the Web.

While that certainly represents a potential threat to the traditional cable TV subscription model, some analysts believe the cord-cutting concept is still largely a "myth." On Monday, Leichtman Research Group said its research indicated that just 1 percent of adults view recent TV shows online daily, and 8 percent on a weekly basis.