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Thinking Inside the Box

It’s right there in the name of the company: Evolution Digital’s big aim is to help its partners — mostly tier one and tier two cable operators — evolve to a video future that isn’t reliant on QAM-based technology, but a platform that takes advantage of much more flexible IP technologies.

But there are differing views on how to get there. Some are advocating cloud-based systems that bring IP-like capability to QAM-locked boxes, while others are far more interested in aggressively going after an all-IP future. Though QAM/MPEG transport video won’t go away any time soon, Evolution’s plan to tap into hybrid QAM/IP infrastructures will allow operators to weave together their legacy services with new OTT offerings.

Multichannel News technology editor Jeff Baumgartner recently spoke to Brent Smith, Evolution Digital’s president and chief technology officer, about why the current path makes the most sense to independent cable operators.

Next TV:Evolution has been focused on helping independent operators transition to IP video. Can you give us a status report on that progress?

Brent Smith: From our perspective, everybody’s kicking the tires on IP, or at least talking about it, but not necessarily doing much. Especially for tier two (operators) and below, these are all theoreticals rather than practical strategies.

Generally, their connection with IP video has to do with the TV Everywhere platforms, where they basically bring in user authentication to allow subscribers to go directly to HBO Go or Showtime through their mobile devices.

NTV:Why is that? Is it because the IP video transition is so immensely complex that it’s not really on the front burner yet?

BS: In the absence of there being an IP video set-top, a leased-box solution, the only devices that can consume IP are mobile and laptops and PCs and so forth. So for an operator to start investing heavily in IP headend equipment, encoding, security, encryption and transport for IP video, there needs to be more devices out there that can consume that content.

To do TV Everywhere, it’s pretty simple because you’re getting the mobile device to point to the Internet and to HBO as opposed to having to collect all of that video in IP and then re-encode it and distribute it out to the consumers.

NTV:I think all would agree that QAM/MPEG transport is going to be with us for a long time. So, what’s going to be the process for this transition?

BS: We’re betting the farm, so to speak, on hybrid [QAM/IP]. It’s more of a pragmatic and logical approach to transition to IP.

The advantage of having a hybrid box that can receive all of the regular linear broadcast services in QAM is you can then segment your content so that live linear stays in QAM, but anything that’s nonlinear — on-demand content — that could be transitioned to IP. The advantages of focusing on VOD are that you can then take that content that goes to your set-top box, if you’ve got a hybrid, and use that to also deliver VOD to mobile devices because it’s an IP format. Operators can then start to migrate their service offerings beyond just VOD on the leased model set-top box to the mobile devices of their subscriber.

NTV:Let’s talk a bit about the emergence of this new type of digital transport adapter (DTA) with an IP capability. What role do you expect that to play with cable, and what are the regulatory issues surrounding it?

BS: In terms of the impact that a hybrid box will have on the market, there are already announced deployment plans for hybrid boxes, with WOW [Wide Open West] using the TiVo service on top of our hybrid box with DTA security. This is really going to be the starting point for a fairly significant deployment of hybrid boxes in 2016.

NTV:Is this something different than the traditional way TiVo is being deployed in the U.S. today, with boxes equipped with CableCards plus an IP/OTT capability?

BS: Yes. This is how we bifurcate the marketplace — if you look at the cable market today, the whole-home solutions that are out there from TiVo and Moxi [Arris], and even Comcast with its ‘X’ platform, they’ve really kind of addressed the top-tier subscriber that’s willing to pay a significant amount of money leasing these boxes. Let’s set aside the cost of the services; it’s the lease of the hardware for a whole-home device plus all of the little IP clients.

It’s unlikely that you’re going to see gateways in every home. What we look at is the other 70% of the market, which is not a whole-home customer today. He may have an old legacy SD or HD box that supports QAM VOD, but it’s very limited in scope. We see that this Smart Box, as TiVo brands it, is a streaming box, so effectively like a Roku and a cable box smooshed together in terms of its functionality. But then the TiVo service is the thing that unifies the QAM cable TV and the over-the-top stuff like Netflix and Amazon and Hulu, etc.

It basically shrouds all of the stuff going on in the background, and the customer doesn’t know if it’s IP video or if it’s QAM video, and he doesn’t care. He’s got a unified search and he can go grab content how and when he wants it. It’s everything a TiVo does today short of recording content and storing it.

NTV:Are there thoughts about doing that recording in the cloud instead of the device?

BS: An operator, if it deploys TiVo on our Smart Box, can get access to the operator’s SVOD content, so there are things like all of the episodic stuff available through HBO On Demand or Showtime On Demand — that content’s available and streamed to the box.

Network PVR options are certainly out there, and the box can support that. The issues are more around content rights and the other stuff that everyone’s faced with in the U.S. market, in particular.

NTV:On the 4K front, a few major MVPDs are offering some content. Is 4K even much of a priority for independent operators at this point?

BS: We believe that if 4K takes off in any meaningful way, it’s likely going to be in an IP format. Even today when you look at the product that’s out there — Amazon and Netflix have 4K content — that’s all basically streamed. We don’t see operators planning out QAM-delivered 4K.

In terms of our roadmap, we’ll include a 4K hybrid box, but a lot of that is subject to the availability of content. Over-the-top seems to have a bit of a head start because they don’t have any infrastructure costs per se.

So what we’re doing, and this includes our recent acquisition of i-Velozity, which is largely an IP-VOD platform, we have the capabilities of offering a 4K VOD solution to tier two and tier three operators.

NTV:So for you it’s not necessarily a technology question, but a content and market readiness question?

BS: We’re really trying to keep this hybrid box, which could replace old legacy SD and HD proprietary set-tops, with a sub-$100 price point so that there’s a justification in removing the old boxes that don’t support any kind of IP connectivity and replace them with something that does and has the future growth potential to maybe migrate to all-IP at some point and turn off the QAM in the hybrid box.