Monthly Archives: November 2010

Microsoft working on over-the-top virtual platform: another “topware”?

Reuters has reported that Microsoft is in talks with pay-TV networks to roll out its own subscription service based on a “virtual cable operator” model. According to Reuters’ confidential sources, the service would not roll out for at least another year.

There is increasing availability of over-the-top content (catch-up and premium) on the Internet – but lack of standards for non-PC connected devices has made it hard for content providers to reach multiple distribution channels, as virtually every device requires adjustments to their service.

Initiatives such as YouView in the UK and Google TV in the USA are examples of ‘topware’ – specialised over-the-top middleware specifications that can be used across devices – and could represent a step forward in the standardisation of OTT services for connected devices (see image below – click to enlarge).

Topware

However, as demonstrated by the ‘Internet TV Principles’ charter published last week by French broadcasters, content providers are inherently uncomfortable with players such as Google TV, who they fear will sell advertising over their content. Walled-garden connected platforms such as Youview* and country-specific HbbTV initiatives (such as TNT 2.0 in France) are more likely to succeed in developing a secure environment where content providers feel under control.

As more premium content becomes available online and more devices implement topware specifications, the major challenge for these platforms will be to ensure that content is secure and specifications are correctly implemented by manufacturers.

With its dominance in the DRM space as well as the TV middleware experience acquired through its Mediaroom product, Microsoft will be the platform best-positioned to address connected devices and become the de facto standard for over-the-top services – provided it can make content providers comfortable with its approach.


*As of November 2010, Youview (former Canvas) shareholders include the BBC, Channel 4, Arqiva, ITV, BT, TalkTalk and Five

Sky makes VOD subscribers pay for bandwidth

BSkyB has announced that any extra bandwidth incurred by usage of its new Anytime+ VOD offer will count towards subscribers’ monthly download allowance.

Anytime+ is currently being rolled out as an optional upgrade to owners of Sky HD boxes who also take Sky’s broadband service (Sky has 3.2m HD customers, and a total of 2.8m broadband subscriptions). The VOD service allows subscribers free access in on-demand mode to some of the content they are entitled to under their current subscription package.

However, for users on Sky Broadband’s cheaper package, the download of around three 30-minute standard definition programmes a month would already reach the maximum 2GB usage allowance, creating the incentive for users to upgrade to Sky’s uncapped package.

This approach differs from that of rivals BT Vision and Virgin Media, neither of which counts VOD usage towards their broadband usage caps.

As ISPs increasingly add free VOD and catch-up TV to their own subscription services, the presence or absence of bandwidth caps and guarantees on quality of video streaming will become increasingly important as tools to differentiate their offers from those provided through over-the-top devices and services.

BSkyB is an early example of this trend, and is gambling that its customers will accept paying extra for broadband as a fair exchange for access to a free VOD offer.