News

June 23, 2007

The Future of TV is HD over the Web

I’m Back! After a year building a studio and shooting miles of web video for Jeff Pulver’s Pulver.Tv. I’m back to what I know best. Writing about technology, how it works and it’s best uses and bringing you conversations with some of the most innovative thinkers in technology.

My inspiration, Jef Raskin, the creator of the Macintosh who believed computers should be fun and easy to use. Now among the immortals Jef continues to inspire my work Jefthe Movie.

The Future of TV is HD over the Web. At least that’s the message here At Web Video Summit being held at the beautiful San Jose Mariott at the Convention Center. Web Video Summit.

It’s possible now if your are among the few around the US who can get Verizon’s Fios fiber optic network which promises up to 50 yes 50 Mbps downstream and up to 5 Mbps up depending on where you live. Om Malik reports Verizon now has half a million TV subscribers. And that CEO Ivan Seidenberg projects 9 million by the end of 2007 and 18 million in another decade which is about the time it will probably get to my Central Park West apartment even though they tore up the streets years ago and I know for a fact there’s a massive fiber running right under my block .

It’s also possible if you live in Japan or Korea. Dave Burstein DSLPrime reports 15 million Japanese and Koreans have real speeds of over 50 Mbps projected to increase to 40 million by 2010. Their video offering typically way ahead of the US

Technology that inspires lust and prayer.:
Technology that inspires lust and prayer.“Let it be me.” Now in wide use by those who have lust for an iPhone (Who hasn’t been seduced by the you can’t get one but you want one ad campaign?) its being released this week.

Soon Come
As they are fond of saying in Jamaica to every tourist’s profound frustration, “soon come.” In Jamaica soon can be an hour, a day, a month or a year. Today HD video over the web is not coming soon enough for most people. Fiber to a curb near you, and the equipment, software and distribution platforms that will get it to us where we want it, in our bedrooms and living rooms on our big flat screen TVs is, well… coming soon. But we all know how fast things change in this business.

Ok, I’lI fess up. I’m still watching on my Standard Def television. I’ll take you along later this summer when I venture out to buy my first HD TV. For now my 23 inch sparkling high ultra sharp high definition computer monitor is where I’ll be watching your HD video over the web.

HD Over the Net: You Gotta Believe
I’ll be moderating a panel on HD here in San Jose. Where panelists: Gary Croke, from CacheLogic, Jennifer Grogono of ON Networks Inc. Yaron Samid, from Pando Networks and Ben Waggoner, from Microsoft will talk about the latest strategies and technologies for getting HD out over the web.

The session is called “HD Over the Net: You Gotta Believe because as early adopters we are often asked to take it on faith that the technologies we test run will be bug free and beeasy to operate “soon,” even though they now ruin diets and inspire prayer. If you’re in San Jose, drop by for this free session (you’ll need the code DSLP07 to get in free) or join us for the full two day program. Jupitermedia will be doing it again in New York this fall.

KEYNOTE SESSIONS | 9:00AM - 9:50AM
K5: General Session! HD Over the Net: You Gotta Believe
You can deliver High Definition over the Net, as ABC TV just promised. Little YouTube windows have their place, but HD TVs are taking over most homes over the next few years. Web Video will remain a niche unless it can deliver the necessary quality. It can, and we show you how. This session will help prove that HD over the net absolutely is possible, will be affordable over time, and will reach millions of homes. About thirty million worldwide have connections fast enough today for an 8-megabit stream; that number will be hundreds of millions in a few years, if we keep the networks open.
MODERATOR: Jennie Bourne, Editor, Future of TV.net

I’ll be talking with: Pando a P2P streaming alternative that allows users to download a small application and Ftp large HD files quickly and cheaply. They say 90% cheaper than streaming your results may vary. Cache Logic will be demonstrating live-streamed HD over the Internet at over 6 Mbps. For those of you toiling in the vineyards to make video, Jennifer Grogono of On Networks will talk strategy. Many web-based producers including myself have been shooting HD but delivering DV over the web. What’s the sweet spot and the needed technology and strategy for archiving HD and being ready to make the transition as the number of viewers makes it practical, and how do we make it clear to clients what it takes and what the cost will be? Microsoft’s Xbox is a hands down favorite for delivering HD from the web to TV. We’ll learn more about how it stacks up against close competitor Sony’s PlayStation.

Today distribution is moving away from downloading and even streaming, as we know it. Stay tuned for Adobe’s session on Wednesday where they promise to talk about the creative suite (thank you Premiere Pro is once again available for the Macintosh) but also about new strategies for delivering video to the web without a Browser.

I’ll be talking with producers in the audience looking for programming I want to watch. It’s not that easy to find. Recently I tuned in to TLC’s Makeover Train a web based series that capitalizes on the makeover madness sweeping the nation with the bizarre premise that they can do makeovers on the subway between stops. I was intrigued but like FUSE TV TLC apparently believes the way to monetize their content is to show the same commercial again and again before you view each “episode,” making you want to throw your computer out the window. Hello you guys it’s not worth it. You may be logging page views but I hate you and your client.

The Future of TV is Commercials We Want to Watch
My favorite advertising on the web, a commercial I’ve watched again and again is Prada Perfume’s Ridley Scott spot Thunder Perfect Mind, now making the rounds on YouTube. A “making of” video about the commercial makes it clear that this is big bucks production. Sorry folks but that’s the way I like it. Check out their newest offering Prada.com Several short films showing the design process including a designer sketching a Prada Bag. Very classy. Hello commercials we want to watch.

This is the future of TV. DKNY did it early on with its Road Stories movies. Even Dave who doesn’t care about fashion told me I had to watch Dove’s “Evolution.” I like it.

If you can get big bucks results for pennies my hat is off to you. But for my money the future of TV is not crappy programming in a small grainy window whether it’s on your computer desktop, your TV or your phone.

So my challenge to producers and technologists alike is “be careful out there,” mindful of your audience. Don’t make us suffer bad quality video and inane programming, and don’t try to fool us. When you promise HD deliver HD not high bandwidth standard def. This goes for the cable guys and Direct TV too. The public is getting smarter our TV’s are getting bigger and we can see the difference. So bring it on. Technologies that work, eye-catching HD programming that leaves us wanting more and an interface that makes it a joy to get up and the morning and pop open a gleaming new laptop with a friendly interface.

I’ll also be looking for technologies and software that make producing eye popping jaw dropping video cheaper and easier to produce. Hint: anything that can lighten my load will receive serious consideration. I’ll be using a monopod this conference for the first time because even my beloved carbon fiber tripod has gotten to heavy to carry cross-country for casual shooting. I’ll be looking for a lightweight LCD on camera light with filters built in, editing software that make exporting EDL easy and effective so I can move my content where I want when I want, and advise on encoding, and distribution platforms that like Brightcove where my video is currently housed Bourne Digital make it easy to get the work out. Stay posted.

News

April 13, 2007

On our way to NAB

NAB: Video to Mobile for Millions, HD becoming standard, 3Ds taking Hollywood
Dont let the best ideas stay in Vegas.
The U.S. is about to get 16 more national broadcast networks, as both Verizon and Cingular roll MediaFlo to new mobile phones across the country. People are going to die watching the ball game or soap operas while driving. The same folks who are saying no one will watch TV on that little screen didnt believe texting, ringtones, or social networking would find an audience either. Millions have taken paid subscriptions in Asia, and Europe is jumping on. The U.S. telcos will probably price too high to get many subscribers, but even 5% of U.S. mobile phones is millions of viewers. Qualcomms CEO Paul Jacobs and strategist Omar Javaid will be speaking. Listen.

     Jim (Titanic) Cameron wont steal the show with his demo of 3D filmmaking as he did last year, because hes busy shooting Avatar in 3D. Robert Zemeckis, Steven Spielberg, Peter Jackson and George Lucas are also working in 3D this year or next, with Jeff Katzenberg forecasting a massive shift in moviemaking in the next five years. By 2009 most theaters can handle 3D originals, and small modifications to todays best LCD screens will bring 3D home. Broadcast networks need to think how to make this work, while Verizon will have a great unique selling proposition if they carry 30-70 megabit 3D TV/Movie feeds.

    $1,000 HD cameras wont be featured here, although they are getting darn good. The more expensive professional HD models will be ubiquitous. Estimates run as high as 40% of U.S. homes having HD in a year, so anyone planning knows almost all profitable viewers will soon be HD. D.C. is years behind on this, ignoring the cable price hikes in the HD transition; the need for broadband to be 20-100 megabits, not 2-5; and the clobbering of public access broadcasting.



    Net Neutrality will hit Vegas as Tim Wu, the Columbia Professor who coined the term, speaks on Sunday to the MPEG Forum. Tim, a friend, is one of the few law professors with serious experience in the network equipment business. He knows more about tech than almost anyone else in policy and more about policy than almost anyone else in tech. While at the MPEG Forum, ask David Price of Harmonic to arrange a demo of their new hardware based encoder. The word is that Harmonic and Ateme are the first with a new generation of encoders that do surprisingly good live sports at 6 megabit HD. Some of the most important people in the business will be closely checking out those booths, as well as reviewing behind closed doors the Ambarella encoder chips.

    Joseph Ambeault at Verizon was the first telco operator to promise his set tops will be designed to play all the video over the Internet. That could cost them some IPTV program sales, but would make customers so happy they might switch from cable. His colleague Michelle Webb, responsible for Verizons new local TV stations, is also speaking. Ask Dan York of AT&T whether his customers will have the same choice, or whether AT&T will continue to block HD internet programming to force customers to buy TV from them. AT&Ts blocking of HD video on their 20 meg+ U-Verse network is the first test of the BellSouth net neutrality deal.
 
    Policy wonks only for the Sunday ABA/NAB/FCBA event, which informally showcases a reunion of the Mike Powell FCC in exile. Featured are two Powell chiefs of staff,  Marsha MacBride and Bryan Tramont, Powells General Counsel John Rogovin and his fellow Commissioner and close partner Kathleen Abernathy. Abernathy is doing interesting things internationally with Jerry Abbruzzese and has carved out a niche for herself as a top D.C. advisor at GLG. Dont miss uber-lobbyist Dick Wiley, once FCC Chair. He was once Kevin Martin's boss, and if Kevin doesnt get elected in North Carolina Martin would be a natural selection to replace Wiley at the top of one of D.C.s most profitable firms.   
Martin himself begged off at the last minute for a surprise Congressional hearing, a dangerous move for an FCC chair. Reed Hundt was nearly lynched when he represented the U.S. at an international policy event and skipped the NAB show. Eddie Fritts called the White House, and VP Al Gore excoriated Hundt for not paying obeisance to a powerful lobby.

     If you see this round fellow with a beard, or the irrepressible Jennie Bourne, say hello and point us to some hot new products. Well be cool hunting the show to find the great stuff that isnt making headlines.

December 10 , 2006
Dateline Paris

We always rent apartments in Paris. This time Craig’s led us to our most elegant Paris address to date, at the top of a traditional French apartment building near the the new Opera house. Iliad/Free provides our connection to the Internet and to America by phone included in the monthly dsl service.

Our mission here to learn how bloggers especially video bloggers are different here in Europe than in the U.S.  Now that I work for a conference company I’m very selective about the conferences I attend and report on.  Far too many feature the same talking heads.

Things I’m watching….  Now that the Victoria’s Secret Fashion show is on broadcast television in America, how many Web based video programs will follow.  What does it take to make the transition? And does it result in fresh new programming with a a radically different point of view? Marketeers still complain that the metrics of the web, even You Tube with its hits in the millions don’t ad up to attractive propositions for advertisers who continue to complain that they don't get the detailed Nielson style stats for the web and the familiar buying packages that fit their spread sheets.

More interesting to me is how Web video develops as an independent medium. Interactivity is the promise but will it work.  In a  recent interview with Shelly Palmer he questioned why anyone would want to click on Jennifer Aniston’s sweater. But as a closet fashionista who’s secret vice is the BBC version of “What Not to Wear,” I know that this is one arena in which girls and boys may diverge in their use of the web.

My secret web fascination is Prada.com. Beautiful video created by  pro Ridley Scott and daughter worth watching more than once.  It opens with a Flash collage that reminds me, like Second Life, of Myst my first truly enganging computer experience. Mouse over a gently swaying chandeliere or a cameraperson at work and a whispered sound track from the movie’s production seduces. Links to shops, ads for perfume, the movie and the making of create a compelling non-linear narrative.

In case you decide as I did that Prada's quality should become the video standard for web, take a look at the making of… classic Ridley Scott with cranes, dolleys,  lights Hollywood style equipment. 

DKNY’s road show videos where the models gratuitously change clothes often enough that it could be classified as soft porn is less artistic, but good locations and again excellent production values make it more than watchable.

Which raises the question do the masses care about the quality of video on the web.  I cringe at the grainy pubescent whining videos but happily sample hideous quality pirated copies of Hollywood movies bootlegged onto P2P networks before plunking down $12 US to see movies.

My compromise is to shoot hdv for the web with the best quality lights and sound I can afford.  Although I’m always forced to knock it down for distribution, I like knowing I can upgrade to better quality when the web is ready.

Early on we beta tested Prismiq’s excellent set top box which, way ahead of it’s time allowed wireless broadcast of video from my computer to my standard def TV set using DIVX and other codecs in quality I could stand to watch.  Nowadays I grudgingly cable S video and audio separately from my Sony media PC to my TV and navigate Windows based programs to watch downloaded videos on the big screen.

While I wasn’t willing to camp out overnight or risk death in pre holiday waiting lines, I’m betting on Sony’s Playstation as the set top box of the future. 

1. Consumers are willing to buy it themselves saving video providers the cost of subsidizing it. However even at it’s premium cost I’m told Sony is losing money on the 8 processor Blu-ray enabled system. 
2. It connects directly to your TV set.
3. As much as I enjoy miniaturization (I’m working here in Paris with a Sony A1-U hdv camera that fits in my purse) I won’t be watching movies on a video iPod until the goggles are perfected and in my cost range.

I’m looking forward to some surprises and to some new ideas here at LeWeb3 in Paris. As always we’ll be looking at how the technology informs what we see on the web, and the new freedoms both hardware and network solutions as well as new software that makes it easy for artists with ideas who aren’t geeks themselves and don’t happen to have geek friends to access the web .

We been promised interviews with Rodrigo Sepulveda of vpod.tv. who has plans to give Europe the tools for everybody to video blog ; with Michael Boukobza CEO of Iliad who service is providing 2 million French households free phone calss to 30 countries including the U.S and China. Boukobza's next move is to provide 100Mbps fiber for most of Paris. We'll also be talking with Mark Cantor now an extraordinary blogger a decade after founding Macromedia.

In the mean time here are some of the stories we’ve been following in the U.S. and abroad.
 

News

Your TV is Watching You
Do you want them to know what you see?
Randall, who runs AT&T while semi-retired CEO Ed Whitacre plays golf, believes “some people are willing to pay extra to receive personalized information and advertising.” His "granulated marketing"  will soon allow “individual set-top boxes” to receive advertising, based on the pattern of what you’ve previously watched or merged demographic data. This is an advertiser’s targeting grail.

     Katherine Hays of Microsoft’s Massive Inc. subsidiary explains how this would work in video games on Box Live and other platforms. “If you know fast car buyers, for example, also like to play action video games, we can place your ad on the right computers. It can run only on Friday nights if you’re looking to catch customers going weekend shopping.” Microsoft IP TV promises to allow advertisers to target viewers in a particular San Antonio zip code that watch NASCAR (car prospects) and also Golf (high income) for ads for expensive fast cars. The hooks are in the system to co-ordinate with billing or commercial databases for other information about each home.

    The only complaint from the telcos is that the software isn’t ready with this release of IPTV. The providers want the ad targeting ability now. How they’ll deal with privacy is unknown, especially in light of Leslie Cauley’s reports of close co-operation between telcos and government agencies. U.S. law on this is weak, and even in Europe where laws are stronger information leaks are common. I subscribe to Al-Jeezara, and assume that information is somehow tracked by the U.S. government.

    One friend  has access to which customers are buying religious and other programming on demand as part of his job. Call him a cynic but he’s noticed high consumption of “not-for-children” video in the same households. Did page scandal Congressman Foley rent videos of children? Verizon will soon know.



$0.25 To Stream a DVD Quality Movie
$0.80 for HD, .05 for iPod or AOL TV shows
Video on the net is exploding because Moore’s Law has brought the cost down enough to make it practical. Streaming media died with the dot-com bust around 2001 because servers, bandwidth, et al. cost $0.50 to $1.00 per hour for a full screen video, and almost nothing justified that cost. Delivering the video now costs a tenth of that, so we’re moving into the third Internet - fast enough to watch.

 These estimates are from Korea, a small country with relatively few networks but a highly competitive content distribution industry. The rates are for fairly large customers, with most of the video going in a limited geographical area. The UK should be similar when competition heats up, because of the economy provided by exchanging traffic at LINX, a very efficient system that connects all the UK ISPs.

 Broadcast over the air video costs a few pennies per hour to distribute, considering the costs of getting it to stations, what they charge, etc. That’s a proven ad supported model, allowing most TV to be free. Some niches in video on the net are profitable with today’s costs, while others will need a few more years of Moore’s Law (and no provider toll booths) to make sense. ABC streamed Desperate Housewives and Lost at partial screen sizes; if they had to pay for full screen data rates, the costs today would probably have been too high to make a profit on advertising alone.

Google’s with their it’s own backbone and servers and incredible volume, can keep costs to one quarter to one half these figures. So how does a small producer distributing less than a thousand hours of video a day negotiate a video distribution deal? Expect to pay more and negotiate hard for exactly what you need. Service across North America probably adds 10% to 30%.guideline, and The specifics of the deal, with peaks, unders, overs and different service levels, make an enormous difference. Companies are secretive about their price lists  and nearly every large deal is negotiated off the list price anyway.

 For providing managed servers and Internet bandwidth, several content delivery networks are bidding $10,000 to $12,000 per continuous gigabit per month. That’s enough for 700 1.5 megabit streams, almost DVD quality if pre-encoded in the latest MPEG-4, Flash, or Windows Media. Amazon’s choice of 2.5 megabit encoding may be raising the bar. It’s also enough for over 3,000 300K streams, appropriate for iPods or the quarter screen video AOL and ABC are distributing supported by ads.

While network usage is usually quoted as a continuous flow, video distributors prefer to know how much it will cost for each movie or hour of TV programming they can sell. To make the translation, you have to make some assumptions about traffic distribution across the day and month. These calculations are based on six hours of use a day at half the peak bandwidth purchased, an arbitrary figure that I think slightly overestimates the actual costs. The CDNs are starting to give quotes for HD delivery as well.

 As they say about cars, your mileage may vary. Let me repeat: these numbers have been researched, but the actual costs for any given network will be different.

Don't forget: Streaming, as academic Andrew Odlyzko notes, may be only a small fraction. Off-peak downloading and peer to peer BBC style is much cheaper.

Recently, a small part of a very large media company shared  the actual bids they received for downloading a movie of about 1 gig in the U.S. “The lowest bid was $0.17. Most were in the twenty to thirty cent range.” That confirms my guess that U.S. rates are higher than the Korean data I have. I’d guess European rates are even higher, except where peering is very efficient such as the London Internet Exchange LINX.




Dream Job Reveals Murdoch Game/TV Plans
Video & Broadband network knows what customers want
Rupert Murdoch’s Sky TV satellite is advertising for a Head Of PC Gaming with a goal to “OWN THE SPACE.” They’ve bought Easynet DSL and are rapidly expanding their broadband network across the U.K., selling a combined satellite TV, hard drive set top box, and broadband downloads similar to the AT&T/2Wire deal in the U.S. This may sound like a dream job pub the point is how important gaming is to the future of Internet TV.

The new hire is expected to “launch  and then manage  our new broadband games destination. You're going to build it from the ground up, establishing a team and developing a world-beating site for this fast-evolving sector.
It's a rare opportunity. One that calls for an equally rare individual. You'll have a powerful vision for the future of broadband gaming  and the ability to translate that vision into an effective business strategy to generate exceptional commercial results.

As far as creativity goes, you're in a league of your own. You know what engages people, and you've proved that you can work closely with the top games publishers to bring together a truly compelling product. Free.fr, Comacast, Verizon and other carriers also are planning major gaming offering.

    The Xbox and Play Station3 are designed for video, and could easily replace set top boxes and show video from the web. Currently, both Microsoft Live and Sony’s online network are being kept proprietary, but Xbox 360 and PlayStation3 have far more processing power than any set top. Since they are already connected to the TV (directly) and the computer (Ethernet), it’s just a matter of tweaking the software to be able to offer extraordinary TV as well. How do the numbers add up? People are paying for the X Box themselves. True Sony is selling them at less that cost, but for now that’s their problem. Look for Apple’s Mac Mini for TV, coming soon, it will make Apple a player in TV over the web.

Driving under a new influence
Who Will Die When Video Goes Mobile?

Millions of car DVD players have been sold, and not all go to the back seat for the kids. Can you properly control your car while watching a football game?
Hundreds of thousands in Korea have subscribed to video direct to their mobile phones, and some of them are surely watching while driving.

Samsung Traffic Safety Research Institute says no. They hooked up 37 experienced drivers to a simulator, gave half alcohol and the other half a Digital Multimedia Broadcasting cell phone now very popular. It can work in a car traveling at high speed. The conclusion: taking a glimpse at the TV while driving is more dangerous than driving drunk.  The ability to keep within the lanes and to control speed was lowest when using DMB phones. The DMB cell phones were more dangerous than driving with 0.1% blood alcohol content, legally drunk. In the U.K., people using multimedia devices while driving are subject to a 1,000 pounds (almost two thousand dollar) fine.

 Korea’s Dong-A Ilbo newspaper reports Japan and Australia also forbid drivers to view any picture generating device by law. Oregon, Illinois, and Virginia in the U.S. ban any picture device where the driver can see it.


Satellite + DSL Not Half Bad
Sky Perfect, Sumitomo, Tandberg/Skystream

ATT Builds LIghtspeed for some.  But for millions Homezone provides a separate but not eaual alternative.  England’s Sky TV is using an identical technology.  How does it work?
Step one
Put one heck of a set top/gateway/TIVO in the home and connect up a satellite with 400 or 1,500 channels
Step two
Add a DSL line to make download VOD and trickle-charge overnight the hard drive with the current hits as well as a personalized selection
Step three
Add caller id, voicemail, email, and the full internet on the TV set.
Step four
Combine with slick software to make music, photos, films and everything available throughout the house. Do the software really well, so that it's easy to use even if you can't program a VCR.

Result: a surprisingly compelling service, despite slow internet speeds.

      That's the AT&T plan where they aren't running Lightspeed, using 2Wire gateways that wowed the crowd at CES demos and now is commercially available. They plan Lightspeed VDSL2 at 15-25 megabits for half their territory, while the other half will stay at less than 6 meg and get the box.

       2Wire is a nominally independent company in San Jose created and nurtured by Brian Hinman. A year ago, Alcatel, AT&T, and Telmex bought control of the company, and long time CTO Pat Romano is now in charge. He showed me a working version of their box with a 250 megabyte hard drive in April, 2005. A better than average user interface is crucial to its prospects, although it’s not up to Jef Raskin standards. Debugging the service took more than a year, but now AT&T is offering it widely. It’s functionally equivalent to what BSkyB is doing in the U.K.


Brian Roberts, Pirate King of American Broadband


Broadband's primary use is file sharing, a truth whispered but well understood. That makes Brian Roberts, CEO of Comcast, America's biggest pirate of music and movies. Ivan Seidenberg, Ed Whitacre, and Dick Parsons aren't far behind. After acknowledging their business is on the edge of the law, they need to consider how the culture of downloading will kill some typical video business plans.

    First, will governments put enough people in jail to kill free downloading? Technical solutions simply won't work; even FCC department chiefs made a point of buying TVs without a broadcast flag, and 40,000 movies are already on crackable DVDs. Roberts understands that most people think "free" is the best price, and over 90% of his video on demand comes without charge, including very popular football highlights and dating shows. In practice, Comcast has found the paid VOD volume goes up as well when people get in the habit of watching free VOd they’re more willing to pay to see premium on demand programs. But most of the takers come when the price is right and bundled (subscription VOD). Only a small fraction of homes buy premium holiday movies in any volume, an ominous sign for many proposed networks.

   Second, have people changed the way they watch and listen, preferring to download a library in advance and watch as convenient? That's the way most listen to music, and only a small fraction of TV (most sports, election returns) needs to be live. SBC's satellite offering has a partial answer, trickle downloading 50 popular movies to a 300 gig hard drive they will give every customer, to make it easy to say buy (a movie) now.

    Finally, how much interaction will someone expect who has grown up with the internet, cell phones, and instant messaging always on? The technological and the young would normally be the key early adopters, but they also are the most likely to expect deep interactivity. Playing a TV lottery with a cellphone message is a small step - how soon will they expect much more?

    Our conclusion: many things that seem to make good business sense today will prove to be mistakes as technology changes rapidly over then next few years. We’re looking for answers as usual starting with what the technologies make possible.  Looking closely at how deals with program producers change with telcos entering the marketplace.  Stay tuned and join us on the journey to the future of TV.

October 10, 2006

A new issue is almost ready, but meanwhile here are some recent articles we've written..

What Verizon FIOS Can Do
250/125 GPON, 100/40 BPON, Promise of Open Set Tops
Verizon has extraordinary things coming, although nearly none are part of this morning's announcement, which mostly repeated old news with a few optimistic projections. What they have on the way is amazing, even if they didn't discuss it today. They even are preparing the first real answer to “how can your video be better than cable,” with an on-the-record plan to open the set top to all the video over the net. If they follow through, they will have accepted the most important issue in net neutrality - honest consumer access to content of her choice.

GPON can go 250 down, 125 up. Soon to start early trials, Verizon will continue using another wavelength just for video. They probably won’t offer those speeds at the beginning, but the folks involved are confident it will be reliable. Dynamic bandwidth allocation means the 2.4 gig down, 1.2 gig up is effectively shared, so that 99+% percent of the time any user needing speeds in the hundreds of megabits can access them. Many important technical issues, including interoperability, are making good progress in FSAN.

BPON can raise speeds to 100 down, 30 up using similar techniques bandwidth sharing techniques. Until recently, effectively shared  This is important because Verizon will have deployed between 7M and 9M lines of BPON before they have enough confidence to switch over to GPON. BPON is 622 down, 155 up, split up to 32 ways. That’s considerably better than the low end DOCSIS 3.0 (160/120), and similar to the high end DOCSIS 3.0 (1 gig/100 meg, shared to probably hundreds of homes.)

Babbio and Seidenberg have been talking about a cable-killing open net for two years, and now TV lead Joe Ambeault says, “this release of Home Media DVR does not support that capability. It's on the roadmap for future releases.“ That would be Verizon’s killer app. Two years ago at PFF Aspen, Babbio explained “I need to get cable out of the house. I make my money on voice and data, not TV. We’re considering offering everything.“ Ambeault’s comment to Mike Robuck of Communication Technology is the first public statement they are moving ahead. If they do, I’ll be able to watch on their multi-room PVR everything from FIOS video as well as my choice of channels from the Southern Baptist Church, Google, Amazon, Al-Jeezera or The Jerusalem Post. I also asked Brian Roberts speaking at IRG, "would you sell Comcast's program package over Verizon's fiber network?" Roberts was poised. "I saw Ivan at USTA in Las Vegas, and he told me to be ready for that question. We agreed to say 'the devil's in the details,' so we'll see."

Verizon will do 3M more homes passed this year (to 6M), and has the technical capability to do 4M to 5M next year. The major bugs are solved, so it’s just a question of whether they spend the money. Contractors including Bechtel, Dycom, and MASTEC assert they have plenty of installers ready to jump in. That would take Verizon to only to 12M homes passed in 2008, and 18M in 2010. By then, they intend to have dumped enough lines (line losses to cable and wireless, sell or spin-off) to be down to about 25M homes on their network. They will have rebuilt 75% of the network in 6 years. This is actually disappointing. If they hadn't tried to keep spending down, they could easily have reached 20-22M.

The take rate on data should be excellent. Customers are enthusiastic in a way I’ve never seen in U.S. telecom. The TV is working fine, and numbers are likely to pick up soon. 10% of TV customers are likely to switch as soon as asked because they hate their current provider, which means Verizon (and AT&T) should be able to exceed the modest public projections for 2006 and 2007.



Amazon, Apple Video Will Change the Rules
Bandwidth and video encoding rates rising; margins disappearing
Apple and Amazon are now offering thousands of movies. True DVD quality, which really makes a difference. Much better than Bit Torrent standards. Better user interfaces than Microsoft or any carrier. Soon to be followed by Comcast, France Telecom, and many more. Works surprisingly well. Painfully overpriced, with all the money going to Hollywood.

Amazon’s DVD quality video service, with Apple coming Tuesday, will destroy many marketing plans and badly designed carrier networks. The Babylon 5 Pilot I downloaded today looked great, with resolution and color depth that was a pleasure. The 93 minute show was a gigabyte and a half file WMP encoded at 2.5 megabits, with another 400 megabyte file for smaller players. On a Time Warner cable modem, it came over in 59 minutes at nearly 5 megabits per second. The speed was rock solid, and tests at other times suggest that speed is pretty consistent. On AT&T’s standard $30 DSL system at 1.5 megabits it would have taken over three hours. Years ago at a DSL Forum meeting, Kevin Kahn asked why anyone would want more than 1.5 meg. The answer: more people watch television than read books. The third Internet is fast enough to watch. I was wrong thinking it would come soon, but it’s here now.

     Traffic will increase, although not necessarily faster than Moore's Law brings down costs. That's a problem for companies trying to run edge routers beyond their natural life. Fortunately, Cisco, Alcatel, Juniper, Redback and the component makers supporting them are bringing the prices down quickly. In North America and most other markets, costs of traffic/routing have actually been going down to date. Companies working with obsolete gear may see a slowdown. The fantasies of bandwidth exhaustion are wildly improbable on a properly maintained network, but capex below depreciation could create problems. The actual cost of carrying the traffic is less than 10% of the DSL price in almost all cases, so even an unlikely step function - 50% increase - still is far less than the marketing budget. I wouldn't be surprised if bandwidth costs continue dropping, given the edge router price wars.

Some likely consequences:
Apple and Amazon will lose money because Hollywood is demanding all the profits. They need the product line to sell other goods, including video iPods, so they’ll accept losses.
The TelcoTV financial model is fragile, perhaps broken. Hollywood will squeeze, and with more buyers leave next to nothing for the operators. Apple and Amazon will accept that, keeping prices and margins down. Video at AT&T was considered a loss leader for five years or more already. Losing even 10% and more to over the top competition push real profits out towards infinity. Andrew Odlyzko predicted this at Fast Net 18 months ago, but few have heard him yet.
Customers will demand more speed, and Amazon’s site reports cable 2-4 times faster than DSL. Time Warner cable worked for me today - solid five megabit download for an hour. That’s good for FIOS, where speeds will go to 50 and 100 meg within the year. It could be good for DSL, because people will buy more expensive service, or it could be a disaster because higher speed cable modems win most customers.
50-1 contention ratios need to be lowered. Until now in North America DSL traffic growth has been very slow. Equipment costs have gone down faster than traffic went up, so the total cost has been dropping. That may even off, and in Japan and Korea may be slightly on the other side of a cost curve. Anyone predicting a hockey stick uptick almost certainly has made a mistake modeling traffic or costs. Or a lobbyist being untruthful
AT&T is particularly vulnerable, especially if they continue capping Lightspeed at a low 6 meg.  Everyone including Chris Rice is talking about raising the speeds, but Randall is afraid to go to Wall Street explaining his capex needs to go up $2B a year. That’s enough to force a dividend cut and might even prevent him from succeeding Ed. They have a couple of good years perhaps, with the price increases they are getting in local service, long distance, and even wireless. I don’t pick stocks, but the AT&T/Verizon relative prices are out of whack. Are Verizon’s operational problems really that bad?
Open set top and home network architectures being a crucial edge against cable. Joe Ambeault of Verizon says the roadmap for their whole home DVR will allow watching video over watch video over the net as well as Verizon’s programming. Mike Robuck has the story. Thomson and Amino are ready if Verizon is serious. This is a breakthrough if Verizon follows through, and the only way I know to deliver on Seidenberg’s call to “get cable out of the house.“ Seidenberg might as well cannibalize his money losing video offering anyway. He tells me the profits are in voice and data. Verizon in Washington doesn’t act like it, but FIOS is architected to be an open system.  AT&T in DC swears they will be open too, and “won’t degrade”, but have under built their network.
     
$0.25 To Stream a DVD Quality Movie
$0.80 for HD, .05 for iPod or AOL TV shows
Video on the net is exploding because Moore’s Law has brought the costs down enough to make it practical. Streaming media died with the dot-com bust around 2001 because servers, bandwidth, etc. cost $0.50 to $1.00 per hour for a full screen video, and almost nothing justified that cost. Delivering the video now costs a tenth of that, so we’re moving into the third Internet - fast enough to watch.

      Broadcast over the air video costs a few pennies per hour to distribute, considering the costs of getting it to stations, what they charge, etc. That’s a proven ad supported model, allowing most TV to be free. Some niches in video on the net are profitable with today’s costs, while others will need a few more years of Moore’s Law (and no provider toll booths) to make sense. ABC streamed Desperate Housewives and Lost at partial screen sizes; if they had to pay for full screen data rates, the costs today would probably have been too high to make a profit just on advertising. 

      These estimates are from Korea, a small country with relatively few networks but a highly competitive content distribution industry. The rates are for fairly large customers, with most of the video going in a limited geographical area. The UK should be similar when competition heats up, because of the economy provided by exchanging traffic at LINX, a very efficient system that connects all the UK ISPs. Google’s cost, with their own backbone and servers at incredible volume, are one quarter to one half these figures, I’d guess. Someone distributing less than a thousand hours of video a day would probably pay much more, although I don’t have enough data. Service across North America probably adds 10% to 30%, but again I don’t have hard data. So use this figures only as a very general guideline, and negotiate hard for exactly what you need. The specifics of the deal, with peaks, unders, overs and different service levels, make an enormous difference. No company shares their price lists with a reporter, and nearly every large deal is negotiated off the price list anyway. 

     For providing managed servers and Internet bandwidth, several content delivery networks are bidding $10,000 to $12,000 per continuous gigabit per month. That’s enough for 700 1.5 megabit streams, almost DVD quality if pre-encoded in the latest MPEG-4, Flash, or Windows Media. Amazon’s choice of 2.5 megabit encoding may be raising the bar. It’s also enough for over 3,000 300K streams, appropriate for iPods or the quarter screen video AOL and ABC are distributing supported by ads. While network usage is usually quoted as a continuous flow, video distributors prefer to know how much it will cost for each movie or hour of TV programming they can sell. To make the translation, you have to make some assumptions about traffic distribution across the day and month. These calculations are based on six hours of use a day at half the peak bandwidth purchased, an arbitrary figure that I think slightly overestimates the actual costs. The CDNs are starting to give quotes for HD delivery as well.

       As they say about cars, your mileage may vary. Let me repeat: these numbers have been researched, but the actual costs for any given network will be different.

        Don't forget: Streaming, as Odlyzko notes, may be only a small fraction. Off-peak downloading and peer to peer BBC style is much cheaper. Looking forward to meeting Bram Cohen of Bit Torrent at VON.

BT: “Yes.” We’re going to collect
Brings Net Neutrality issue to Europe
BT has for several years planned a massive video service, with a facility that was originally conceived with a scope to match Google. Until unbundled competition forced their hand, BT set standard download speeds at 512K, less than full screen video. Cyrus Memawalla of Westhall Capital asked about Net Neutrality, and after a first evasive answer followed up and got a direct response: “Yes.” Transcript from seeking Alpha, via James Enck, the best telecom reporter in Europe. 
Memawalla: Would you consider charging media companies for use of your network?
Ben Verwaayen: Yes, we would. Paul?
Paul Reynolds: 21CN is not just about bandwidth and capability on that bandwidth. Some of the things that you will start to see coming through, as mentioned in this chart, is the opportunity to create new markets. So we absolutely intend to provide open interfaces to 21CN and charge for them where people can innovate and provide new services on the back of that network. In fact, you’ll have to wait and see exactly what those services look like. So the answer is yes.

    The issue in the UK is slightly different than in the U.S. BT Retail has “only” 31% market share, with at least four major competitors. In the U.S., we have only two. 

BellSouth's 20,000% iTunes markup
Why the Bells are fighting so hard for Internet tollbooths
Bill Smith of BellSouth wants to charge “five or ten cents” to carry a typical iTunes song, which costs him about 5/100ths of a single cent and dropping. I'm sure Smith was hasn't thought through actual pricing, but the extreme example he gives shows how much is at stake. Every broadband provider who's discussed the subject openly has said their costs are going down. That cost figure is carefully researched, including public comments of a major operator, exchange bandwidth costs, and the actual cost figures implicit in presentations of SBC CFO Randall Stephenson. Claims of “bandwidth costs so high we must charge to recover them” are simply lies that make executives look very foolish. Reporters who believe this kind of stuff without demanding factual backup about the real costs are simply not doing their job.

     The U.S., unlike China, believes in freedom of speech. Ed Whitacre, Ivan Seidenberg and Mark Fiedler should not determine what you can watch on television as delivery moves to the Internet.  State power controls the net in China, and broadband providers with near monopolies are tempted to exercise similar control in Western nations.  Mike Powell and Kevin Martin have both declared closing the highspeed Internet unacceptable; we'll now discover whether the FCC has the courage to enforce their own rules.

January 30 , 2006 Future of TV.net

Sex and violence is winning Jeff Bewkes the top job at Time Warner, the world’s largest media company. Across the world, 37-year-old Li Ruigang has a different approach he is building a Shanghai Media Group empire with political acumen and business innovation. Bewkes made his reputation with Sex and the City and the Sopranos. Ruigang has to be more cautious on government owned SMG. His weathergirl can’t be “immodest”, and police dramas are currently verboten because too many episodes featured crooked government officials. Ruigang answers directly to China’s Ministry of Propaganda.

Time Warner is responding to advertisers, Kevin Martin’s indecency campaigns, and Carl Icahn’s blunt investor criticism.  

 Li Ruigang personifies Chinese TV’s move from propaganda and boring “cultural workers” TV to commercial entertainment resembling offerings in the West, a transformation Dave reports below. Next issue, a closer look at SMG and IPTV in China.

 We also have a broad look at Google’s strategy. Google’s great challenge may be carriers who close their networks, but the world’s largest IPTV system builder reports below, that’s a political choice. The technology can work either way.

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Gates’ Viiv Isn’t Working
No Digital Media Adaptor to connect the home
The key feature of Viiv, the DMA that allows listening and watching everything around your home isn’t working yet and won’t be delivered on any of the machines Bill Gates will hype in his CES keynote, Digitimes reports. Intel confines many of the Viiv features will be late in 2006. These new Wintel boxes are just souped up Media Center PC’s, with $300M of Intel advertising along with an enormous Microsoft publicity push. The DMA feature, a fancy transcoder that supports devices from remote televisions to home stereos, isn’t expected until June or later.

 The billion dollar-marketing machine is too far advanced to stop. Intel and Microsoft‘s engineers haven‘t yet been able to deliver the “digital home” VP Don McDonald promised saying, “consumers are passionate about the idea of accessing their content anytime, anywhere in their home on a number of devices.” Implementing Microsoft DRM and other software in a form suitable for $50 home players is proving a tough problem. If they fail, prices of the connecting devices will be too expensive.

 Viiv’s key defect is the tie to Windows. 99% of non-computer home gadgets run Wind River, Linux, or proprietary CE control systems, and patching them to Microsoft is tough.

 Reporters are questioning the instant on, instant off feature, which seems a great improvement on the ridiculous Windows boot-up. Those testing the system report only the lights on the system go off, while the machine stays on all the time burning lots of electricity. 

50 Million TV connected PCs are coming, some incredibly small
Microsoft virtually giving away Media Center Software/PVR
Viiv may be more marketing than product, but Microsoft’s plan to include WMC on fifty million computers may have a powerful impact. If users do connect them to TVs as intended, that will double the number of PVRs and probably quadruple the number of Internet connected televisions.

 Dell is offering a complete Media Center PC this week for $499, and most Gateways will also include the software. Expect Microsoft to cut similar deal to include Media Center at almost no extra cost on most consumer computers.

Slingboxing New York TV in Jerusalem
Tens of millions coming in Windows Media Center and DVR’s
Jeff Pulver blogged, “It's now 4:45 am local time in Jerusalem, but I'm awake and online and have spent part of the night watching TV. I'm not watching Israeli TV, but rather the Cable TV from my home on Long Island, by simply running the Sling Player on my PC, which is connects to my Slingbox. The Slingbox is one of the innovations of 2005 that has become a personal change agent for me. Just the thought of being able to travel with all of the Cable TV channels that I enjoy watching, is something I now take for granted when I'm on the road.”

 ISuppli calculates the Slingbox costs $84 to manufacture, although it retails for $249. Most of the components are already required in most DVR’s and many set-tops, so the cost of adding Slingbox capabilities to an existing unit is probably $25 or so. The standalone needs a power supply and case, a DSP and a TV tuner, and about $10 of memory. That doesn’t include the marketing cost, of the 20 engineers in India who are working on the software and hardware. Hauppauge TV tuner cards for your computer at $49-$150 add similar functions, confirming what the price could be.

 Microsoft is Beta testing “TV anywhere over the Internet” software.
Look for more innovations. Slingbox announced at CES it will support handheld devices. Hauppauge, Snapstream and others have interesting products coming. The chips involved - DSPs, tuners, memory - are among the most competitively sourced, so will be coming down in price quickly. The limiting factor will be the quality possible with slow upstream. Neither DSL nor cable is typically designed for more than 600K upstream, fine for a wireless phone or video iPod, but poor quality for a regular TV. Yet one more reason customers want faster uploads, which DT, KT, and Verizon FIOS are planning.

“Flying to New York with Internet Access and Cable TV!
Add wireless to the equation and the technology becomes really exciting. From the same trip Jeff Pulver blogged, “the flight I'm on happens to be equipped with Wi-Fi Internet Access. So once again, I'm able to blog at 32,000 while sitting in seat 13F. So far, I've caught up on email and I've been watching "Early Today (NBC)" on the Cable TV of my home in NY while flying near the Greek Islands with the help of my SlingPlayer. I've been able to get sustained rates of 150k+ with the Wi-Fi connection on this flight.”

No Room for News as Chinese TV goes commercial
Games, dating, Survivor knockoffs, melodrama take over
News and public affairs programming dropped from 28% of Chinese airtime to 6.9%. Li Yuchun is the new national hero. She won the hugely popular “The Mongolian Cow Yogurt Super Girl Contest" an amateur hour program from Hunan Media Group. HMG has two other big hits, “Date with Rose,” which resembles a hit Taiwanese matchmaking show, and “Citadel of Happiness,” which “lets celebrities and ordinary folk embarrass themselves by, for instance, dangling from 20-meter cords while tossing basketballs at a hoop (Time).”

 China wiped out over 2,000 stations as the central authority forced almost all TV into nineteen regional “media groups.” All are government-owned and report to the Ministry of Propaganda, but operationally are independent and fight hard for ratings and ad sales. The money’s significant: CCTV collected $1B in ads last year, $46M from Proctor and Gamble alone. Shanghai Media Group grossed $300M in 2004, and hopes to grow 30% + per year. The 17M people in Shanghai have more than 160 color sets per 100 households. The 15M in Beijing have over 140 per 100 homes. Even rural areas average more than one TV per home. 8% of urban Chinese intend to buy a flat panel TV in 2006 (McKinsey), creating a market for HDTV and perhaps a demand for better pictures that will create opportunities for IPTV.

 Manager’s salaries and ultimately their jobs depend on ad sales. The government is no longer subsidizing those falling behind. The result: entertainment has replaced propaganda and “good for you” programming across the nation. CCTV has responded by tying producer and staff salaries to the ratings of the shows they produce.

University of Illinois scholar Ruoyun Bai reports drama shows bring in 70% of ad dollars, leading to strong competition to produce the most popular. Except for CCTV and SMG, most production is private and aggressively profit focused. The LA Times is seeing a trend of Hollywood using Chinese production houses to save money. Warner Brothers has a division making Chinese films for the Chinese market, while Sony intends to serve the domestic market 150 hours of drama. While CCTV is offering a highly censored version of “Desperate Housewives” and SMG picking up “Sponge Bob,” only a handful of foreign productions are finding an audience, and the government intends to keep it that way.

 Our tech friends might appreciate “Panorama of Sciences,” a CCTV show begun in 1997 in response to Jiang Zemin’s strategy of “Strengthening the Nation with Science and Education.” Audiences disagreed, and it’s now lucky to stay on the air in an inferior time slot. Media groups that can’t keep up are losing their local audience to the 40 national channels, many now delivered by satellite. A new 300-channel TV bird is scheduled to launch next year.  Newsweek believes romances like Guangxi Television's recent hit drama, "Love of the Aegean Sea," foreshadow a nation of “One Billion Couch Potatoes.” We don’t think anyone in the U.S. should criticize the quality of any other nation’s television.

 Chinese TV may now be entertaining, vulgar, or slightly indecent, but it still dares not challenge the government. English words (like “Internet”) are banned to keep the language pure. “Flirtatious and affected manners on stage,” are officially banned, along with Taiwanese or Hong Kong slang favored by pop singers. Cop shows were very popular, but suddenly disappeared from the air after too many plots involving corrupt officials. "The whole industry is under political control," Time quoted an HMG official. Ye Zhikang, former SMG head, know his role. “The media must help the Communist Party lead the people.”

Next issue, we’ll profile Shanghai Media Group’s 36 year old, U.S. trained President, Li Ruigang. We’ll also look at the much hyped but still unproven market for telco TV. Analog cable, with a typically poor signal, costs only $2 to $4 in most cities. IPTV’s toughest problem will be to persuade people to pay the $8-$10 China Telecom and Netcom plan to charge. Programming will be run by SMG, to satisfy the government. Ruigang explains he “spent a lot of time communicating with our regulators, making them understand how IPTV works and its significance for the future development of Chinese TV.” Oh, how Ed Whitacre and Mark Fiedler must wish their government would back them as strongly. db

Don’t underestimate “half-baked” Google TV
Google wildly overhyped the introduction of Google’s paid video, which had only a handful of things people would pay to watch and a terrible interface that didn’t help you find things. A new DRM that doesn’t work on the Macintosh particularly angered David Pogue of the NY Times. Pogue’s book Macintosh, The Missing Manual, sat on top of the machine used by Jef Raskin, the creator of the Mac. “Appallingly half-baked.” wasn’t strong enough for Pogue’s complaints. “Quarter-baked, in fact.”
 
“We made a big mistake,'' Marissa Mayer admitted to Bloomberg's Jonathan Thaw. ``You can't come out and launch a product like Google Video and say `CSI' and `Survivor' are there if they're not on the home page.'' Actually, the mistake is much more than a bad interface. Google video works, but is simply not ready for primetime until more programs are available and the bugs are fixed. Google is talking to everyone from Paris to Hollywood to Bollywood, and their efficient network will bring the television shows and movies to Google Video. . One thousand of the world’s best programmers work for Google, and will fix the bugs. Google Video will have an incredible selection within a year, and change Hollywood forever.

 Mike Bazeley of the San Jose Mercury kindly blogged some of Dave’s comment that Google's worldwide buying spree of dormant fiber optic cable networks will ultimately support "the world's largest video server network,'' what Burstein calls "the largest TV 'anti-network' in the world.'' It’s always flattering to be in the Merc. Their spirited “Good Morning Silicon Valley” is a primary source for me.

 "The dollars in video are large, and Google (with servers and worldwide fiber) will have strategic advantages,'' Google has the ambition and the track record to become the most important video carrier on the planet, and it’s developing the servers and fiber network to make that possible. As television shifts to the net, only Yahoo and perhaps British Telecom are in position to compete. The ABC's and NBC's of the world are outclassed.
 
 "Google’s team has reportedly been advised to plan services 'as though the servers and delivery' cost next to nothing, although the real cost in 2006 remains in the $billions. They know and we know costs will come down. Once they build the basic network, the cost of doing more will be amazingly small.

 "To make that concrete, a company like MovieLink or Akimbo makes a business plan around a cost of about 10 cents an hour to serve and distribute their shows at full-screen quality. That means that even if the content is free, they have to generate significant revenues from every show. That's why 2-minute movie trailers, or video that shows in a three-inch window, dominate the web. The infrastructure costs are manageable if you are selling movies at $2 or $4, but a tough obstacle if you want to be ad-supported or cheap in volume.

 "Google is thinking ahead, building a network designed to bring that cost to a penny or two per hour by 2008. If the creator doesn’t need to charge, Google can afford to serve it just for the related ads. There is an unbelievable amount of video on the shelf not making money that can now be distributed through Google. Some will be free, other stuff as cheap as necessary to find a market."

 Google’s strength is that it is one of the lowest cost networks in the world, supported by the best and cheapest server system yet imagined. Google keeps down costs by building their own servers. They are also experimenting with new low-power multithreaded processor machines designed for them by Sun that may even be cheaper. Custom software connects tens of thousands of computers into a distributed giant computer, largest in the non-classified world and probably bigger than NSA. The best of Bell Labs, including Bill Coughran and Rob Pike, are now at Google optimizing the system software.

 Yahoo is responding by building relationships with SBC, Verizon, British Telecom and of course Terry Semel’s base in Hollywood. They also are hiring scads of good people and buying cool companies like Flickr and del.icio.us. Danah Boyd, an emerging star, has moved from Google to Yahoo while still writing her dissertation at Berkeley. She writes “Caterina Fake, Stewart Butterfield, Joshua Schachter, Andy Baio, Cameron Marlow, Chad Dickerson, Tom Coates... These aren't even your typical Web2.0 crowd - these are creatives with attitude who have no problem telling corporate what they think and pushing for changes that they feel are essential.”

 Will Google and Yahoo overtake the Rupert Murdochs, Paul Reynolds, and Li Ruigangs of the world? We’ll be watching.

Michel Rahier “Alcatel’s Network is Open”
Ready to deliver whatever the customer requires
Alcatel is now the key provider of IPTV in the West, as ten years of R&D, acquisitions, and strategic partnerships put them in the lead for almost every major contract. SBC is the showcase, while Swisscom, Telecom Italia, and BellSouth are also planning millions of lines. Rahier, President of Alcatel's Fixed Networks Division, spoke proudly about how their integrated system - DSLAM, high reliability routers, subscriber management, and headend connections - can meet different needs.

 European regulations are more advanced than the U.S., with competition authorities requiring Italian and British football to be available to via multiple services. Key Alcatel customers, including France Telecom and Deutsche Telekom, are currently selling as many lines through independent ISPs as through their own retail affiliates. Rahier, a PhD in electrical engineering, was able to resolve immediately my question about the networks they are selling.

 “Nothing in the Alcatel equipment or software is designed to close the network. We support crucial Internet standards that allow interconnection. We know networks and their traffic will evolve rapidly, and we have to be ready."

Briefs

• 50 Sundance short films are already officially available online, a breakthrough soon to be matched by thousands of full-length features with limited commercial prospects. Producer Chris Coppola notes, “The Internet is becoming the great conduit and it no longer takes a theatrical to promote your films.” (via Laurie Sullivan and Techdirt)
  
• All the noise about downloads hurting Hollywood is so far unproven. Star Wars III was available everywhere on Bit Torrent, but still took in $50M per day. When Harry Potter came out, the studio distributed night vision goggles and swore they’d prevent videotaping. Of course, that was just considered a challenge, and several copies soon circulated. Jennie’s new camera, the Sony A1U, shoots in High Definition, weighs less than two pounds, is incredibly small and fits easily in a purse. Sony’s camera division will have an even smaller model next year, while SD cameras will be the size of a big iPod. Try to stop that in ten thousand theaters around the world.
  
• IPTV over DSL reached approximately 1.5M customers by midyear 2005, up half a million from the beginning of the year, Point Topic’s John Bosnell estimates. That includes 441K in Hong Kong at June 30, where in November they reached 500K subscribers. France, where FT is chasing Free.fr, was at 270,000. Point Topic speculates China may be as high as 100,000, niche operators in the USA and Canada perhaps 200,000 and the UK perhaps 24,000. By December, Telefónica’s Imagenio reached 200,000 subs.
  
• Guiding Light, General Hospital, The Young and the Restless, and other soap operas apparently have a large audience of geeks, if MovieLink CEO Jim Ramo is correct that only geeks are using Bit Torrent. They were all moving well on Mininova when I went to double check his comment to Forbes. Ramo is open about his key problem, “it’s hard to compete with free.” A typical selection on Mininova includes numerous videos that appeal to non-geeks, including Desperate Housewives in French, English Rugby and German football,
  
  Press
  Mike Landberg at the Merc predicts 2006 will see “The first-ever big merger between a Silicon Valley company and a New York-Hollywood media giant.” This trend is strong in Korea, where telcos are buying music companies and TV studios. Spain’s Telefónica still owns part of Endemol, the “Big Brother” studio. There’s also the AOL Time Warner disaster to consider. SBC was days away from buying DirecTV, one source tells me, with a team of dozens in a hotel finishing due diligence. The story was Whitacre killed the deal when major investors told him it would drive down SBC’s stock price and his options.
  
  People
  Lee Kai-fu was just the first of many Chinese Microsoft executives to quit. Bill Gates‘ opinion, "First, we were f'ed by the Chinese people, and now the Chinese government has f'ed us," apparently isn’t playing well with his employees. DGM Ye Weilun went to Trend Micro in August, the same month CMO Martin Wu went to eBay. Interfax adds Xiong Minghua became the Co-CTO of Tencent in December. Don’t look for Chinese IPTV to use Microsoft standards, although SMG was part of a 2004 Microsoft press announcement.
  
  Stock market
  Harmonic, a leader in video codecs, lost $2M in the fourth quarter despite a strong position in IPTV and good prospects going forward. When investors ask, “what’s the next big thing,” I worry. DSL is about to pass 150M subscribers, definitely a “big thing,” but three out of four of the early companies failed. Wireless phones are the biggest trend of the last ten years, but most companies and their investors lost money. So while FTV.net will be reporting enormous growth in video over the net and IPTV, be very cautious assuming any given company is a good bet. Most won’t be.
  
  
  

October 21 , 2005 Future of TV.net

SBC - First To Say Their Network Will Be Closed
Price of Bandwidth Continues Dropping
Guest editorial: Don't Block Video over the Net
Japan's Masayoshi Son Cutting Prices Changing Lives
Comcast: One month, 100 million ON DEMAND programs


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SBC Clamps Down on Outside Video

“Oh no,” SBC's #2, Randall Stephenson answered me on whether his DSL customers could watch live video beyond what SBC is selling. “We‘re going to control the video on our network. The content guys will have to make a deal with us.”  Around the same time, Al Gore, a man who might be President, had to come hat in hand to Marilyn O'Connell of Verizon, seeking carriage of his Current TV channel on FIOS. She found it interesting, so the odds are good.

     Something is inherently wrong if the crucial innovators on the net need to beg the carriers for basic freedom of speech. Peter Grant and Jesse Drucker Friday brought the issue of video blocking to the front page of the Wall Street Journal, changing the entire debate in Washington. It should now be hard for the AT&T deal to close without a clear solution. Martin is not joining to turn down the SBC - AT&T merger over this, although Stephenson's comment is a direct slap in the face. Nevertheless, he can, if only to prevent a delaying tie vote, demand a merger condition on this and the related open peering issue that is more than the usual meaningless statement. Courage Kevin, Katherine, Michael, and Jonathan - AT&T needs this merger, and there will never be a better time to stand for an important principle.

       Where the net is open, we will have remarkable choices. Google, Yahoo, and many others have great plans we will be reporting. If not, we get the ugliest side of media concentration. SBC's Lea Ann Champion described their offering “Eighty percent of the channels come from about six companies.” This is media concentration at the ugliest.

     There is no major technical or cost factor preventing SBC or Comcast keeping their network open, despite the carrier's attempt to spin. We have some of the hard data below, and much more to come.


SBC - First To Say Their Network Will Be Closed
Last year Mike Powell hit the roof when Grant and Latour reported the beginning of this story In the Wall Street Journal. Therefore, SBC responded with a clear statement, one of the best tests of net neutrality I have yet found.

“SBC does not plan to give meaningful preference (in terms of bandwidth allocation) to any particular video service or video content provider. ... We don't plan to limit access from computers or give bandwidth preference to content.”

     That statement is now apparently inoperative. 

     I asked Randall Stephenson whether the Southern Baptist Church Channel, MovieLink, or Google will be able to send live video at full quality if they were not part of SBC's chosen programming. “Oh no!” was the answer I got, and feared.  “They'll have to make a deal with us. We‘re going to control the video on our network.” Obviously, not all content producers will be allowed to make such a deal, and hence will not be available to SBC broadband customers. Instead, SBC will try to sell their cable-like program selection.

     Selim Bingol of SBC claims that Randall's comments only pertained to what video is on their own offering, but that's simply not so. I made a point of saying I was discussing video delivered directly, specifically that not in their package. Selim wasn't there, I was, and so were others who can be asked about the conversation. I'm not misquoting.

Price of Bandwidth Continues Dropping
Liberty Global Pays $0.10 per gigabyte, $0.15 for DVD quality movie
Internet bandwidth isn't “free,” but it's become cheap enough to make DVD quality video practical while discrediting absurd bandwidth charges like BT's.  Tony Werner, CTO of the largest cable company outside the U.S., has succeeded in peering 92% of his data traffic, dramatically bringing down the cost. During analyst day in beautiful Rose Hall, Werner noted that companies recently purchased by Liberty had been paying about 20 euro per megabit of transit. Because of his efficient volume buying, his direct cost is about 10 euro. John Malone's Liberty has major holdings in Japan, Holland, France, Chile, Romania and has just bid for Switzerland. On peered traffic, the cost drops to about 5 euro. I hear from others the U.S. is a little cheaper, smaller customers pay more, and much of Africa, Latin America, and India are high. That works out to $0.50 to $1.50 per customer per month, based on typical traffic patterns reported by other carriers, including occasional heavy downloaders.

    About $1/customer/month is probably right for a large carrier in late 2005. I have been using a figure of “less than $2/customer” based on data now over a year old from several sources. More recently, I have heard bandwidth costs similar to Liberty from a mid-tier U.S. carrier, the remarkably efficient London Internet Exchange folk, and the buyer for a major video provider. I can infer similar costs from Randall Stephenson's ARPU and profit analysis, given his comment that one-third of SBC customers take a higher tier. 

     Translating the cost per constant megabit flow of traffic to a cost per gigabyte of data requires making assumptions about usage, but is important for analysis of video over the Internet costs as well as whether bandwidth caps and charging are reasonable. (They aren't. at least up to 50 gigabytes.) I have not been able to get firm data, so I am making assumptions that probably slightly overstate the costs. If you get four hours per day by 30 days per month, that is 120 hours per month. One-megabit continuous flow is about 500 megabytes of traffic per hour, or 60 gigabytes of traffic per month. For a company like Liberty, that's about $0.10 a gig at the rates Werner mentioned. BT, DT, etc. should do at least as well, especially given their existing worldwide backbones and share of major undersea fiber. A good confirmation of this comes from the carrier commitments to IP TV carried across their network. They wouldn't be possible without switching/fiber costs that are this low.

    Traffic costs remain at or below typical marketing costs unless the user goes well over 50 gig consistently. Two gig or even 10 gig “caps” have no cost justification. They are partially a way to keep some users' prices high, and increasingly a tool to prevent watching video over the net in competition with the services BT and others offer themselves.

     The costs calculated in this item are lower than now out-of-date estimates, projections from carriers trying to justify high rates, and the internal cost figures in some large telcos. Both Verizon and BT once overstated their marginal bandwidth costs and shadow pricing to their own DSL divisions. That raised profits in their (largely unregulated) internal backbone and produced “losses” in their DSL division, although the money stayed within the same company. 

     This should go down with Moore's Law, and fall by half in 2007 or 2008 and again by about 2010. The incremental cost of moving bits over existing fiber is largely the switching/routing cost, electronics constantly getting cheaper. In most of the developed world, there's enough unlit fiber for several more years.

Guest editorial: Don't Block Video over the Net
From Andrew McLaughlin of Google: 
Our mission in Washington boils down to this: Defend the Internet as a free and open platform for information, communication and innovation. OK, that sounds a little high and mighty, so let me break it down into something a bit wonkier with a sampling of the U.S. policy issues we're working on:

Net neutrality. As voice, video, and data rapidly converge, Congress is rewriting U.S. telecommunications laws and deregulating broadband connectivity, which is largely a good thing. However, in a country where most citizens have only one or two viable broadband options, there are real dangers for the Internet: Should network operators be able to block their customers from reaching competing websites and services (such as Internet voice calls and video-on-demand)? Should they be able to speed up their own sites and services, while degrading those offered by competitors? Should an innovator with a new online service or application be forced to get permission from each broadband cable and DSL provider before rolling it out? Or, if that's not blunt enough for you, what's better: [a] Centralized control by network operators, or [b] free user choice on the decentralized, open, and astoundingly successful end-to-end Internet? (Hint: It's not [a].)

     At Future of TV, we put it even more directly. Do you want to choose what you watch, or do you want Brian Roberts and Ed Whitacre to choose it for you?

Japan's Masayoshi Son Cutting Prices Changing Lives
Son in Japan: Thousands of channels, millions of videos to download
Google, BT also building extraordinary server farms
Never laugh at Masayoshi Son; he already changed the world twice, first by selling 7 megabit DSL service for $20 and taking millions of customers from NTT, then by adding VOIP at minimal cost for 4.5 M subscribers. He invested $2B along the way, sometimes finding the cash in unexpected places, and now has turned EBITDA positive, as reported in DSL Prime. The business models now changing Europe are copying his success.

     Next, he intends to bring IP TV to 7M Japanese. It's an entirely switched network, with a typical office connected by dark fiber supporting 4 gigabits of data and easy to upgrade. Massive headends can essentially supply (and switch) as many channels and programs as Son can acquire and digitize. The actual cost of digitizing is $75/film and drops rapidly with quantity; the server space is just a few dollars. In quantity thousands, headend costs per channel should be in the low thousands by the time he's ready. Two million videos, two thousand live channels could be encoded and served for perhaps $150M today, dropping by half in two to three years. That's about 60 cents per month per subscriber, by five million subs - a cost that makes sense.

  Where will all this video come from?

TV worldwide produces about 31 million hours of original programming, Berkeley‘s Peter Lyman and Hal Varian estimate. Approximately 370,000 motion pictures were made around the world from 1890 to 2002. If the entire universe of original film and video titles were played continuously, the show would continue for 2,108 years. Less than 5% of these programs earn anything at all commercially today, and probably less than 1% command Hollywood prices.

    Christian broadcasters, by the dozen, are finding it impossible to get on many cable systems, and are demanding “must carry” from the FCC. At many newsstands in New York, you'll find papers in Russian, Chinese, Spanish, German, French, and literally a dozen others. The lower cost of video equipment will allow every university with a football team, every large church or political body, every ski resort looking for promotion, a dozen buddies from film school working together, and thousands of other to create channels. 99% will find small audiences at best, and many programs will prove unwatchable. But the remaining 1% have enormous potential. Future of TV.net will be featuring the new equipment whose low prices can chance a heck of a lot.


Comcast: One month, 100 million ON DEMAND programs
Comcast proves VOD is today
In March, Comcast customer downloaded 100 million programs, most of them without additional charge. Future of TV.net believes the tuning point has already been reached - VOD is here. 94% of Comcast VOD shows are without additional charge, clearly showing what customers want. To do that, Dave Fellows has built a robust network with central hubs and multiple intermediate caches for efficiency. Legacy cost is about 30 cents a program streamed; forward cost, about ten cents. The streaming servers and software are in the $100-150/per range, but the full cost - including the fiber backbone, routers, gig-E to the CMTS, etc. his colleagues estimated at about $300 per stream last fall, falling.

    The peak of VOD demand to date has been 8% of an area's homes, and the current system is built to 10% concurrency. They intend to raise that so that 30% of covered TVs can be watching different shows, often time shifted. They're guessing that 70% of people will watch the streamed 400 channels or so or something stored on their hard drive, at least for the next few years.

“Don't Let Anyone Say HDV Isn't Broadcast Quality. We're Using It.”
Our Sony FX-1 costs less than a big TV, the sharpness is incredible but be prepared for the whopping file sizes. Even Hollywood types are using it.
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“We used a Panasonic HDV to shoot scenes for one of this year's most acclaimed network series,” says Hollywood producer Robert Cohen who also happens to be Dave‘s uncle. “The small camera was able to get shots where our regular equipment couldn‘t go. No one noticed the difference.” Cohen couldn't mention the series name, but previously produced for “24” and other shows you've watched. The Panasonic only goes to 720P, but has a native 24-frame mode that fits well with Hollywood workflows.

Our Sony goes to 1080i, and is an absolute delight. Premiere or anything else running on a PC is still painfully slow sometimes, although the Cineform Aspect plugin  that comes packaged with Premiere Pro speeds things up, that‘s just a Start. Download the trial version of the full package it's pricey but it will make you remember why you went  HDV in the first place.

Jeff Pulver,  bought the same camera, and choose Final Cut Pro for his Mac. For editing, dual processors and a RAID really make a difference, but that's now under $2,000. Intel has released dual core Pentiums at a good price, and the supporting chipset controls a two drive RAID. We priced dual core 3.0 megahertz Pentiums with 500 gigs split between two hard drives under $2,000.

     Good equipment without skill is worthless, but prices give millions of people a chance to prove how good they are. A very small fraction will be worth watching, but even so a very wide world of programming is coming. Less than $10,000 now buys an HDV camera, an edit station fast enough to work online, shotgun, lavs and regular mics, pro quality software, basic lights, and two cases with wheels that let you take everything but the PC on a flight to Paris. At the Marconi Dinner featured below, you'll see Jennie's short piece honoring Claude Berrou - shot on HDV.



Stories in the works:

China Telecom and China Netcom are starting to deploy half a million IP set top boxes, likely heading towards millions. It's currently illegal for a telco in China to compete on video, so they are calling it a trial. They've cut a deal with Shanghai Media Group, the #2 television producer, that should solve their licensing problem.

BSkyB bought Easynet to offer a satellite + DSL connection to a super-TIVO set top box. That's the same strategy SBC intends outside Lightspeed territory. Interesting possibilities, under the working title Separate, Not Equal, But Pretty Darn Good.
SBC's choice of a proprietary video system from Microsoft isn't working out well, yet one more reason to prefer open standards. Phil Thompson of mPhase will have some thoughts.

Email

• One media analyst wrote skeptically about our Bronx Beats Babbio story, about two entrepreneurs already delivering in the South Bronx the kind of thing Verizon is promising for years in the future. He wondered why the UrbanDSL folks had almost no reporting or web description of what they've done. Wrote him back with an introduction, saying , "I've visited their NOC, from which they have fiber to 50 buildings in the South Bronx (some quite large) and an active service with VDSL up the risers. They've been scrambling to make things happen, and getting publicity and a fancy website haven't made it up the priority list. So I had completely missed them myself, despite being only three miles away, until I got an invitation to visit." Another reporter's suggestion, however, that small folks like UrbanDSL make Verizon unneeded is going too far; no likely funding or growth path lets them do more than a small fraction of New York City. Thanks to Om Malik and Broadband Reports for picking up our story.

Briefs

• Amazing that staid old Auntie Beeb is perhaps the most progressive network on earth, with 5,000 Britishers already in a trial using Bit Torrent to download any of the week's programs.
• Ken Pyle debunks the notion that the picture in picture of Microsoft's IPTV is revolutionary. “One note of caution is that many pundits are underestimating the ability of cable and, even satellite, to provide the same interactive functionality as IPTV. Features like multiple camera angles, which I hear touted over and over like they are a new concept, were commercially proven in the early 1990s by Canadian cable pioneer Videotron over coaxial cable television plant. The MSOs will roll out these features as needed in order to stay competitive,” the editor of the Viodi View believes. It's a free subscription, and more than value for the money.
• Japan Telecom, dissatisfied with $15M of Scientific-Atlanta set tops boxes, is shifting orders to an Asian maker who produced software more appropriate for what Japan needs.

Wall Street

• Eric Kainer of Needham has incorporated into his thinking what MediaFlo and TU are  shortly to demonstrate. "Instead of a 5-play," he corrects us, "think of it as dual triple plays, one mobile and the other fixed. A 6-play, if you must."
• Merrill's Jessica Reif Cohen confirms the Comcast optimism on free VOD, writing “In Philadelphia, where Comcast has offered VOD for over 2 years, over 85% of subscribers have used VOD over the past 3 months.”
• Nikos Theodosopoulos of UBS confirms the discrepancy we noted between the numbers of HD sets sold (high) and the numbers of people watching HD programming, so far. He notes “HD set top penetration in the US remains at under 33% of installed HD TVs, while demand for HD TVs continues to be robust.”

People

• Ken Ferree left the FCC broadcast bureau to be #2 at the Corporation for Public Broadcasting. The top job came open, he went for it, lost out to a political appointee, and now has decided to become a D.C. lawyer again. He will probably make more than twice what the guy who got the job will. Living well is the best revenge.

Editor Jennie Bourne has degrees from NYU Film School and Columbia Journalism. She has produced for television, edited network news and a fashion magazine, hosted the evening newscast on WBAI-FM in New York, taught at Rutgers University, and still has lots to learn. Jennie loves technology toys, hates their misuse, and takes pride in explaining the geek stuff to humans. Email jennie (the usual) futureoftv.net
Publisher  and Research Editor Dave Burstein is also editor of DSL Prime and Fiber News .
Jennie and Dave collaborate on DSL: A Tech Brief (Wiley, 2002) and Jef, a forthcoming documentary about Jef Raskin, creator of the Macintosh and much more. 

Subscriptions are free. Just reply with subject "subscribe" and we'll add you. Or "un" to be dropped. Please forward this and encourage colleagues to subscribe.
Copyright, 2005, Jennie Bourne.

 

May 17, 2005

• Bronx Beats Babbio to FTTP Video
• 256 channels fiber to the basement where Verizon fears to tread
• SBC, Time Warner can't kill commercials on VOD/network DVR
• Hollywood Saying No to Network Timeshifting. Can Microsoft persuade them otherwise?
• Revenues from TV supporting "No monthly fee" Mumbai (Bombay) DSL
• Direct satellite to mobile phone, Shanghai Media, The BBC
• Microsoft's 6 meg HD demo isn't the real world
• "80% of the channels come from about six companies."
• SBC's ultimate demonstration of media concentration
• Customers abandoned by KCSM analog turnoff near 40%
• Pax Threatens Broadcasters' Must Carry Rules with All-Infomercial Channels
• Ailing Pax TV takes automatic license renewals to absurdity
• HD TV 2007: 18M or 50M?
• Will the sets be connected?
• Sony's New Supermodel Shoots HD 1080i
• Briefs: Thomson's HD IP, Michael Harris' Cable Digital News ,  Philip Swann's TV Predictions Newswire

Subscriptions are free. Just reply with subject "subscribe" and we'll add you. Or "un" to be dropped. Please forward this and encourage colleagues to subscribe.

Terry Denson, Verizon's video guy, has an impossible job. His boss, Ivan Seidenberg, is promising "From Day One, we'll offer ... a new customer experience." Denson will be lucky to catch up with state of the art cable networks, which offer thousands of free VOD choices, 500 channels, 24-hour local news, interaction, and a multi-room DVRs.

Join Future of  TV at Columbia's IPTV.2 conference May 23rd. We'll be on a panel with Denson and will suggest there's only one way for Verizon to truly outclass cable. Open the network and let Comcast, DirecTV, Echostar, and Time Warner offer competing packages over Verizon fiber.

Madness, you say? As things stand video will be a loss leader at U.S. telcos for years.  FTV asked Seidenberg whether he'd consider opening his network. “We're building FIOS to get cable out of the home,” was his reply. “My profit comes from telephone and high speed data. I want to keep the customer on my network." His greatest opponent, Comcast's Brian Roberts, says if the price and details are right he'll consider it.

Join us at Columbia. Jennie will be talking about our coming movie, Jef, and we'll both be waving the flag of "freedom to access the content of your choice." We've said it before and we'll say it again, any program, any time anywhere.

Write jennie @ futureoftv.net and tell us what to look at next.
Email Dave Burstein daveb @ dslprime.com to advertise to our 14,000 subscribers

*** The irrepressible Jennie Bourne, editor of Future of TV.net and Director of Jef , is just one of the speakers at the Marconi Columbia IPTV.2: The Second Generation of TV Over The Broadband Internet May 23, New York. Darcy Gerbarg and Eli Noam will bring together Gali Einav of NBC, Jonathan Knee of Evercore Partners, MTV's Joseph Veret, Phil Thompson of mPhase and two dozen more to try to find some answers for us. http://www.citi.columbia.edu/ (psa)

Bronx Beats Babbio to Broadband Video
256 channels fiber to the basement where Verizon fears to tread
UrbanDSL – Stuart Reid and Douglas Frazier - are delivering video over fiber to the basement/VDSL while Verizon hasn't even gotten serious about trials in the city.  Pacesetters Reid and Frazier were also among the first to offer VOIP, reselling Vonage under the original deal many couldn't understand three years ago. They've even secured  a municipal franchise, something the Bells, among the world's best lobbyists, say can't be done.

     Forget burned out buildings, street gangs, and streets unsafe for masters of the universe. Some brutal poverty remains, but today's Bronx also provides rich business opportunities. "Everyone in the neighborhood tries to find a way to get their kids a computer and the internet," Frazier says of his customers.

      Urban's IPTV is entrepreneurship at the most demanding. They've led the crews trenching the fiber, trained people from the neighborhood to do the installs, and searched the country for used equipment to keep the price low. Their NOC, a stone's throw from Verizon's central office, is crowded with racks of Next Level, Tut, and other respected gear. Frazier and Reid manage Urban themselves, making sales calls training staff and troubleshooting 3 a.m. emergencies. They've worked together for twenty years, building urban cable systems and acquiring, along the way, the skills needed to create a working system that trumps a dozen small telcos' much publicized video trials. They deliver more to their users, at a better price, than many companies with ten times the resources.

     A subway ride away from Verizon headquarters, Urban is proving IPTV can be done. Of course running five million Verizon lines is a different challenge than 5,000, but Verizon can no longer say serving the Bronx is impossible.


SBC, Time Warner can't kill commercials on VOD/network DVR
Hollywood Saying No to Network Timeshifting. Can Microsoft persuade them otherwise?
SBC budgeted Lightspeed without the DVRs, thinking they would instead record all the programs on video servers and play them on demand. CBS, NBC, Fox and ABC are refusing to allow telcos or cable companies to timeshift their shows - especially if people can fast forward through the commercials. Brian Roberts of Comcast thinks the networks will cave, because people