As Comcast and other MSOs start to transition to Internet-protocol video, they’re painfully aware of a lesson AT&T knew years ago — it’s much easier to deploy apps for the TV in a total-IP environment.
AT&T got U-verse TV off the ground almost a decade ago; it has 5.5 million video subscribers and is still seeing that base grow at a healthy clip while cable operators scratch and claw their way toward reversing years of video subscriber losses.
While it certainly helps to be the new kid in town, AT&T’s gambit to go all-IP from the start has paid off so far, giving the telco what the cable industry is now gunning for — an application-rich platform that delivers a unified experience that can traverse old and new set-tops alike.
“What 100% IP does is, it allows us to really upgrade our customer base,” GW Shaw, AT&T’s vice president, U-verse and video services, said. “[Whether] you were the very first customer we brought on or you’re the customer I brought on last week, you have the same U-verse TV service.”
UP WITH APPS
While Comcast has started setting the table for IPdelivered apps with its X1 platform, AT&T has already blazed past the appetizers and started the main course with what it calls “U-verse Enabled,” an open set of application programming interfaces (APIs) for thirdparty developers.
Although it’s not looking to create a massive app store like those of Apple or Google, U-verse is creating a smaller batch of apps aimed at helping it “personalize or extend the video service,” Shaw said.
The U-verse Enabled program, launched in late 2011, has spawned more than two dozen apps that run on the TV, including several that work in tandem with smartphones and tablets. Examples include Poker TV Night, Twonky Beam (which flings Web content to the TV), Buddy TV (personalized recommendations), U-verse Jukebox and U-verse Kids!, a free mobile app that displays kid-friendly content and can control the U-verse set-top.
AT&T estimates that customers execute more than 5 million sessions of U-verse Enabled apps each month.
AT&T’s IP environment would also make it easier for the telco to integrate over-the-top video apps such as Netflix, which has made set-top integration deals a priority. Shaw declined to discuss specific conversations underway with Netflix, but said, “We’re talking to everyone about what the opportunity is.”
In the meantime, AT&T has been expanding the capabilities of its TV Everywhere apps. Last week, it added 27 live TV channels to its app for iOS-and Android-powered devices, expanding to 136 the number of channels that can be streamed in the home and to 44 those that can be accessed outside the home.
CLOUD DVRs AND EST
While AT&T’s IP-based system has allowed it to stay in front with TV-delivered apps, it still hasn’t pulled the trigger on new products that other competitors and pay TV providers have already pushed out; namely, cloud DVRs and an electronic sell-through (EST) option that lets users buy movies and TV shows and play them back on set-tops and mobile devices.
Verizon Communications has offered an EST product for years, and Comcast has been gaining ground on a market dominated by iTunes since launching its own Xfinity TV Store last November.
U-verse hasn’t committed to an EST strategy, but the company “is absolutely looking at what our opportunities are with electronic sell-through,” Shaw said.
Comcast has also rolled out a cloud-DVR product in Boston that runs on its X1 platform, and is expected to expand deployments to other markets in its northeast corridor soon, with Chicago rumored to be among the cities further out west that could get it by this summer.
“We’re analyzing our options as well on what we could or couldn’t do to have the content rights work with [a cloud DVR],” Shaw said.
Many service providers, including AT&T, are keeping a close eye on how the Supreme Court’s review of the Aereo case shakes out, and how it might affect rules that govern network-based DVRs.
“The technology doesn’t scare me at all on it,” Shaw said of the cloud DVR. “It’s all of the other pieces … that have to fall in line to make that experience [work] the right way and to deliver the kind of experience that a customer would find exemplary.”
MORE MOBILITY AHEAD
Looking ahead, one thing to keep an eye on is the evolution of Mediaroom, the IPTV middleware platform on which U-verse TV operates. Ericsson acquired Mediaroom from Microsoft last year and has been working on an upgraded version that will help its partners expand the viewing experience beyond the TV. That upgrade will also incorporate adaptive-bit-rate technologies and cloud-DVR capabilities that came by way of Ericsson’s acquisition of Azuki Systems earlier this year.
Ericsson has also begun to outline the vision for what it’s calling TV Anywhere, which will offer a refreshed multiscreen interface enabled by personalization features that run on a more agile, cloud-centric architecture. The company demonstrated it at last month’s Mobile World Congress show in Barcelona, Spain, but has not yet set a date for a formal launch of the nextgen platform, noted Ben Huang, a former Microsoft exec who is now head of global marketing for Ericsson Mediaroom.
TAKEAWAY
AT&T’s gamble on an all-IP environment is paying off, providing an application-rich platform that serves old and new set-tops alike.
