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Broadband Revives Concept of Digital Home Platforms

03 марта 2006

By Paul Budde, Budde Communication

My first home media center experience goes back to 1994 when Comcast launched, very much ahead of its time, the first media platform delivering, amongst other services, VOD.

I was there again when the relaunch of this service took place exactly a decade later, at the same NCTA show, in the same city, New Orleans.

The difference between these two events is broadband. We now have an infrastructure platform that can deliver video quality entertainment over such networks. Of course, the market hasn't sat still in the meantime, and there are now several players in this market, coming from different industries - the cable TV industry in the U.S., the telcos, the IT industry and the CE industry.

Intel's VIIV platform

A significant breakthrough took place earlier this year when Intel launched its digital home media platform VIIV (as in 'five'). It encompasses the total industry: Content producers, the network delivery industry and end-users. It's an open platform, certified by the Digital Living Network Alliance and it's expected that the various companies playing in this market will integrate VIIV into their own products. The consumer electronics industry is seen as possibly the first big mover in this space, starting to implement VIIV initially in their upmarket home media centers and from there on slowly at lower prices in the rest of the CE market.

BSkyB first cab off the rank

Interestingly, one of the first cabs off the rank was BSkyB in the U.K. It's using the technology cleverly to get access to people's home PC (currently they only have access to customers' TVs - the PC will give them extra eyeballs while, at the same time, offering competition to the telco players, who undoubtedly will enter this market with their own products in an attempt to obtain access to the TV.

Catalyst for new business opportunities

The launch of the new platform coincides with the fact that the first Internet media companies are now looking beyond the current media and telco developments. They see broadband penetration moving rapidly towards the 50 percent of households and new wireless broadband will add the personal market to this as well. With this in place companies are now preparing themselves for the new business opportunities to deliver a whole new range of services to their customers.

While some of the key players in the market are desperately trying to cling to their old telco and media products, and to defend their monopolies in these markets, the Internet companies are leading the charge. Increasingly they will be able to package into their offerings a range of services thatwill further undermine the traditional players for as long as they fail to make structural changes to their organizations in order to participate in this booming market.

Overhaul of the lounge room

While current thinking is that it will take a very long time before customers have replaced all of their mainly analog entertainment gear in their house, the Internet economy model is very much aimed at free and low cost access, built from their commercial models, which are based on advertising and premium services. I can easily envisage these companies providing free boxes as part of such a service and thus pushing the new services into people's homes much more quickly. This could, for example, easily make the issue of slow digital TV penetration obsolete in just a few years' time.

Think WiFi and Bluetooth and a much neater lounge room will appear before your eyes.

Content providers are coming to the party

As we have been predicting for some time now, we are also starting to see a shift in Hollywood. We have always maintained that the Hollywood studios would only stick to their current distribution systems of release windows for as long as it suited them. Platforms such as VIIV are allowing them to securely deliver content directly to end-users. Not only will that make them more flexible - at the same time we will see them moving into different content fields, away from the expensive blockbusters that are increasingly attracting fewer customers. It will be up to the customers to decide what they want to buy and watch, and broadcasters who miss the boat will be left out.

Customer service is going to be king in such an environment and good retail organizations will be able to extend their services online in a secure and uniform way.

About Author

Paul Budde (skyreport-text@mediabizcorp.com) operates Paul Budde Communication, a global telecommunications and information highways consultancy and research company based in Australia. The company's Web site can be found at: http://www.Budde.com.au. The e-mail address is: pbc@Budde.com.au. (Please note, opinions expressed in "Outside the Box" are that of the author and not of the editorial staff.)


Source: SkyREPORT E-News

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