Sezmi is shutting down its consumer OTT video service, in what could be viewed as another setback to the stand alone OTT model. In an announcement on its website, Sezmi says it “… has changed its business focus to providing our product and technology platform to service providers, internationally and in the U.S., who are interested in providing broadband video services to their customers. As a result, we are no longer supporting our direct-to-consumer service.”

Sezmi launched the consumer video service back in 2009. It was billed as ‘all-in-one television service’ and offered local broadcast content, VOD movies, and cable network programming, and a DVR. Sezmi was trying to position the service as an alternative to the traditional subscription TV model, and offered the service direct-to-consumers in 36 markets across the U.S. Sezmi charged $20 – $25 per month for the service.

Originally Sezmi attempted a wireless TV offer, but then shifted to Internet delivery. They also scaled back their channel line-up, presumably because of the difficult nature in gaining programming rights outside of the traditional pay-TV model.

Sezmi says they will now look to partner with telecom service providers who are interested in using their platform to deliver ‘broadband TV services’ to end customers.

The concept of Sezmi made logical sense. Why not bundle local broadcast with OTT video and VOD to create an alternative video package to customers who don’t want to pay $80+ per month for cable service? Unfortunately for them, the realities of the market don’t always match up with logical concepts.

ZillionTV tried a somewhat similar path (although there were distinct differences), but never made it off the gound. Major challenges with these approaches include lack of their own network to reach customers and no existing customer relationships to leverage.

Certainly other direct-to-consumer OTT providers have had some success. Netflix comes to mind. But those offers position themselves as a complement to the existing pay-TV model, not a replacement. At least for now.