A new NCTC, MobiTV deal, announced today, will help shape an ongoing debate about the future of pay-TV. Is that future based on a bring-your-own-device (BYOD) app model, or will customers continue to opt for the status-quo operator provided set-top-box (STB) scenario?
The National Cable Television Cooperative (NCTC), made up of primarily small independent cable and broadband operators, has partnered with MobiTV to make the latter’s app based pay-TV platform available to its members.
The platform replaces a traditional STB with app based ‘middleware’ which can be accessed through connected TVs, on streaming media players from Roku and Apple TV, and on personal computers, tablets and mobile phones. The app provides access to the operator’s live channel line-up, video-on-demand assets, and cloud DVR (if provided), among other features, on these devices. Operators will need the appropriate programming rights for mobile device viewing.
NCTC, which has about 800 members, chose MobiTV after evaluating 20 providers of STBs and STB apps, explained Rich Fickle, NCTC president and CEO, in an interview.
App Based Pay-TV
Using an app platform to eliminate the set-top box may enable pay-TV providers to reduce the cost of providing service. Fickle expects to see pay-TV provider customers downloading the app at no charge, eliminating the need for a truck roll as well as the cost of the STB.
Customers do need a streaming video player and Wi-Fi, but many of them already have that. Alternatively, some providers may want to provide the same player for all customers to minimize support issues.
“For the most part, it’s a self-install,” observed Fickle. “The operator needs to make [available] good broadband service and [make sure] the Wi-Fi connection is high-quality.”
He added that some older streaming video players may not be supported but “for the most part, devices purchased in the last couple of years will be fine.”
Providers will be able to brand the service and offer local channels, noted Charlie Nooney, CEO and chairman of MobiTV.
“There is a lot of power in the brand for operators in the local community,” he said.
Two Implementation Options
MobiTV and NCTC will offer two options for how providers can implement the app platform and service. Providers can purchase their own encoding, storage and management and manage that equipment or they can purchase those capabilities as a service.
“A lot of companies may not be able to justify a large investment,” commented Fickle.
“They can start as a shared service and as they add more [customers], they could own and operate their own local equipment,” added Nooney.
Security capabilities of the MobiTV offering are based on a combination of software and hardware, noted Fickle.
“If it’s just security with software, it’s not as strong,” he said. “It’s the combination of software and hardware that creates better security.”
While pay-TV providers may want to use an app based platform to eliminate the STB, they are likely to use that approach only for new customers, while their embedded base continues to use existing STBs, Fickle commented.
Adapting to Apps
Pay-TV providers that already have begun offering the app platform approach include C Spire. The popularity of Netflix and emerging OTT streaming options like Directv Now are pressuring traditional pay-TV providers to adapt. App based platforms are more conducive to the proliferation of video viewing devices beyond the TV.
The concept of an app platform and BYOD for traditional pay-TV operators is still largely untested though. Larger providers like Comcast have introduced apps into their STBs, specifically the X1 platform. But that’s still largely a status-quo STB approach. A growing number of larger operators have also added app options to Roku devices, Comcast included.
Using service provider branded apps for TV Everywhere, or mobile viewing, is on the rise, but that’s also a relatively complementary service to the traditional in-home STB/gateway model.
This NCTC, MobiTV deal will be worth observing. It could prove to be an important milestone in the ongoing evolution of the pay-TV model.
Bernie Arnason contributed to this post.