Newsletter
Google Left Banner
Telcos Are Reinventing TV
12 Nov, 2008
The TelcoTV Conference kicked off this morning with keynote addresses from both AT&T and Verizon. Dan York, Executive Vice President of Content for AT&T and John Harrobin, Senior Vice President for Marketing and Digital Media for Verizon both offered glimpses into their respective company’s three screen entertainment strategy. A recurring theme throughout both presentations was that telcos are reinventing the television experience, and doing so more effectively than their cable competitors. “Telcos are at the center of reinventing TV,” said Harrobin. “Telcos are best positioned to mine content assets and maximize value,” through the integration of mobile, broadband and TV, and are executing that vision better than cable, said Harrobin.
“We’re redefining ourselves as a communications and entertainment company,” said York. “But entertainment is more than just video,” he said. York painted a picture where entertainment involves integrating all services and platforms with an entertainment portfolio. “Putting entertainment in the bundle is not enough,” said York. “This goes beyond putting three services on one bill.” The emphasis of telcos beating cable at their own game couldn’t have been louder. I counted five instances of “more than cable” references in York’s 30 minute speech alone. Harrobin alluded to the “death of linear television” and suggested that telcos are better positioned to leverage the future of television which will be more focused on VOD and web integrated video experiences. “The magic happens when we connect the three platforms of mobile, broadband and TV,” he said.
Despite the bravado and hype of York and Harrobin’s comments, there is an argument to be made for their hypothesis. TelcoTV operators are being more innovative with video and are executing a better three screen strategy than their cable and DBS competitors. But realistically, what choice do they have? They have to be more innovative and offer a more compelling mix of features to compete with well entrenched cable and DBS competitors. The same could be said for cable’s assault on telco’s core service – voice. Cable is offering more innovative voice offerings than their entrenched telco competitors. It’s a factor of the marketplace. Competition is always a catalyst for innovation.
digg this story
googlePost new comment
About Telecompetitor
Telecompetitor is a leading industry blog covering the telecom competitive landscape. We provide insight, analysis, and commentary on the issues and implications of the evolving telecom competitive landscape.
a publication of
Channel
Webinars/Events
Upcoming Events
NTCA Wireless Symposium
Jan 7-9, 2009 - Austin, TX
Featured Article
Should Telephone Service be Free?
12 Oct, 2008
Comcast announced a new promotion last week that offers 12 months of free basic cable service for new customers who also sign up for an additional service. Customers who don’t want an additional service can get Comcast’s basic service of about 20 -30 channels for $10/month. The promotion is tied to the digital TV transition of February 2009 and entices potential customers to avoid the transition “hassle” by getting “free” cable service. “The simple fact is that basic cable is the easiest path through the digital transition and now consumers can get it for free,” said Derek Harrar, General Manager and Senior Vice President, Video Services for Comcast in a company statement. This move is similar to strategies pursued by other video service providers, who are hoping to leverage the digital TV transition for new subscriber additions.
But is this strategy a leading indicator for the future? Should basic core services like basic cable and basic telephone service be offered for free, used as a “carrot” to entice customers to buy “more important” services like broadband? Maybe a very basic phone service, with no LD, access to landline 911, and maybe outgoing service only (to avoid telemarketers) should be a free component of a bundled offering. Such a wireline service may appeal to a customer who previously cut the cord for wireless only, but also needs broadband. There is a growing portion of the population who find the value of traditional wireline phone service elsewhere – either through wireless or broadband/IP services. But, if they could get the security of landline 911, and an extra dial tone in their home as a free value add for subscribing to broadband (or video from a telco’s perspective), maybe a telco’s bundled offering may look more attractive than a comparable cable offering. I realize this idea is not appealing to the hundreds of ILECs who are a part of the current access/settlement system (in fact, it couldn’t work in the context of today’s regulatory structure), but I wonder whether it’s inevitable. In this possible future scenario, the current settlement system adapts to broadband as the underlying service, as opposed to voice.
This scenario cuts both ways. From a cable company’s perspective, a growing portion of the population is turning to the Internet as a source for their video content, and no longer see value in paying for a broad package of video as a part of a traditional subscription pay-TV service. But, if they could receive basic TV (which includes local broadcast affiliates) as a free value add for buying broadband, maybe the cable bundle is more attractive. In a true IP/broadband world, very basic phone and video service is relatively easy to deliver, and has little impact on bandwidth and network performance. Maybe the digital transition is opening the door to a future where free basic services are a regular component of a bundled offering. Thoughts?
How does this play in the realities of the economic environment
Did any of the execs address the realities of our current economic slowdown? At the end of the day, the consumer will vote with their wallet; at least for now....