Comcast To Offer Quadruple Play And It Isn't Cellular

It may not be a sexy business, but it seems to have a lot of synergy for cable. You have a wired home, you have remote connection to it, why not extend it beyond content. "Comcast Corp is adding home security to its package of services for homes where it already delivers cable television, broadband and phone. The largest U.S. cable provider sees security technology and home management technology as another way to enter new markets and tighten its relationships with existing customers." I love this idea and hope that Comcast and other cable operators pursue this farther.

But given that Comcast has no expertise in this field, I might suggest either an exclusive partnership with an existing security firm or better yet, buy one and rebrand it. This is great opportunity for both internal and external security. For families employing a Nanny, a chance to check in from work; for vacationers, an easy way to remotely adjust the HVAC system, and for security from intruders, more chance to protect and identify robbers.

Obviously safeguards need to be built in against power outages and battery limits, but these can all be figured out. With all the competition in the online space, cable operators may have just found a new business that will bring a nice revenue stream while piggybacking on the current infrastructure. Well done!

Content Platforms Shifting Online

What are the big content creators going to do; ABC, CBS, Turner, Scripps, and others have been very comfortable with a two stream revenue model of subscription and ad revenue. The cable operators have paid monthly license fees to content companies for the right to carry on their channel line-up. But the consumers want mobility and flexibility to watch what they want, where they want, when they want, and how they want.

And content makers have made separate deals with Hulu, Netflix, Apple, and others to offer programming on line. Where the cable operator can try to differentiate itself is by providing their live channel line-up content on line as well. "As the line between traditional TV and web video blur, it will no longer make sense for networks to distinguish between TV and every other video-capable device. This means migrating not only single programs to the web—along the lines of what Hulu, Apple, and others do now—but also letting viewers access traditional linear television from mobile phones, iPads, and of course computers." Slowly, apps are being offered to offer live feeds although the consumer is restricted to watching inside the home. That is not what the consumer ultimately wants. They want complete freedom, untethered from their cable line and cable settop box. For those with a Slingbox, mobility already exists, but it still requires a devoted settop box not being used at the same time in the home.

Online right fees for live network carriage adds another wrinkle to the cable operator. Ultimately, live content mobility is a game changer in the cable industry. Will franchises still be required or will cable companies actually start to compete with each other as consumers get the opportunity to select their mobile cable carrier? Will programming networks think to bypass operators to offer a direct subscription to the consumer? Or will Apple or Amazon come and offer themselves as the platform to sell subscriptions to networks? If so, the cable operator business changes from being a network platform to a broadband platform and they will change their pricing models as well to reflect usage fees.

"Executives from Disney, Turner, and Comcast were in unanimous agreement that we are only two years away from 75 percent of TV content being available online and on mobile devices." On demand content yes, live content, not so fast. And as you can see, it will only lead to many more questions and many more new opportunities.

Goodbye Settop, Hello XBox

So many boxes eager to help you cut the cable cord and enjoy web-based programming. And Microsoft, who in the late 90's invested heavily in Comcast, seems to be rethinking its relationship to push its own platform. "The company also unveiled plans to allow Xbox users to control live television feeds, search YouTube and play video games with voice commands." Should Comcast and the other cable operators be concerned with this news?

"Perhaps one of the biggest entertainment additions to the Xbox will be UFC. Starting this fall, Xbox Live Gold Members will be able to subscribe to UFC to access live pay-per-view matches, classic fights, interviews and behind-the-scenes bonus features. Microsoft said Live TV would be offered by domestic and international broadcasters, but had no other details at the time of the announcement. While Live TV for Xbox 360 is offered in other countries, the service will unveiled Monday would be the first such offering for a game console in the US. Xbox 360 already has the ability to stream and download movies and shows, however." So now Microsoft is competing with cable for a share of their PPV audience. And reaching directly to broadcasters to enable digital access through their device. I wonder, would NBC ever agree to distribution through the XBox or would Comcast try to prevent it? Certainly a question that one day could find itself in front of the FCC.

The cable platform continues to take many hits from the CE industry. Once cable operators refused to play nicely, they continue to find ways to bypass the settop box to directly touch the consumer. The XBox Live platform may one day be the architect of how consumers watch programming and simultaneously interact with it and other viewers. For now, it looks like a good start.

It's Cloud Illusions I Recall

"I've looked at clouds from both sides now, From up and down, and still somehow, It's cloud illusions I recall, I really don't know clouds, at all." Who would have expected that Joni Mitchell got it so right in her song Both Sides, Now. But with the big Apple announcement today, the question for consumers is, Do you know clouds, at all?"

"Apple’s highly anticipated iCloud is expected to make it easier than ever before to listen to your own music anywhere you have an Internet connection." But consumers may want more. Not just music, not just video, but every scrap of data, from address books to spreadsheets, word documents to recipe cards, accessible everywhere and anywhere, at the touch of your finger. Why clutter your own device, when it can be reached remotely, yet securely.

Ahh securely. Now that is a key issue. With Sony getting repeatedly hacked, and others leaving hard drives with sensitive data stolen from their cars, it is hard to feel safe when it comes to personal information. Safety concerns exist on many levels, from the music industry enabling their songs to be protected to consumers worried about their social security and credit card numbers. While the cloud offers many conveniences, can the risk issues be successfully minimized.

Joni's song gets to the heart of the problem. There is still so much we don't know about clouds. The sensitivity of what is placed in the clouds and the protection from being stolen. "It's cloud illusions I recall, I really don't know clouds, at all."

Music In The Clouds

No big secret that Apple wants to be our connection to music and video. And we now know what Apple is doing with their cash. "Apple will fork over between $100 million and $150 million in advanced payments to the four major music labels in order to get its iCloud off the ground, three separate sources told The Post." That means that Apple will have put together a plan in time for it's big announcement next week. And it adds one more feather to the iPhone, iPod, iPad family; all your music available without needing to fill up your hard drive.

"One executive explained that the cloud service will initially be free to people who bought their music from Apple's iTunes store, but Apple is said to be considering a $25 a year charge in the future." Is Cloud access worth a $25 annual subscription? Or do we feel that purchasing the song or movie should entitle us to availability regardless of where it is stored? If consumers buy in to the iCloud as a subscription service, it means that Apple has uncovered another important revenue stream and has beaten their competition to the punch. Certainly Google must be worried that, despite announcing first, they couldn't get their cloud service out quickly.

Anytime Apple announces, devotees wonder what else will be released. While the early PR has all been on cloud computing, some are hoping for more news on their hardware products. Regardless, Apple continues to capture the public's attention with their eye focused squarely on future opportunities.

Time Warner Cable Sees Broadband Only Opportunity

Yesterday's blog talked about the loss of the "all you can eat" broadband consumption model and cable's hope to retain it's triple play business. It also touched upon new competition that could face cable in a broadband only model. And of course, once you hit send, there is an article about Lightsquared, Inc. hoping for approval to compete in this space. But where some cable companies may be fearful of a broadband only world, another seems to embrace it.

"Time Warner Cable Inc. Chief Executive Glenn Britt said Wednesday his company has an opportunity to win more broadband-only customers as broadband replaces TV as the cable industry's anchor product." Changing times require changing strategies and Time Warner Cable seems to get it. Like Netflix changing its model from DVD rental to streaming, TWC is taking its first steps to grow its broadband business as it's linear cable model is slowly declining. And like Netflix, TWC recognizes that this change takes time, but must be embraced. Otherwise, they begin to look like Blockbuster, late to the game, and hard to remain in play.

With Lightsquared planned release early next year, TWC and other cable companies need to redefine their business strategy to remain ahead of other competitive entrants. Knowing that these companies may try to underprice cable companies to encourage cord cutting, cable must strategize and market its competitive differences and push a pricing model that retains and grows subscribers. A usage pricing model is not the answer; TWC is trying hard to retain with its TV Essentials cable package as a way to keep consumers connected. Cablevision has used Optimum Rewards as a strategy to retain its best, triple play customers.

Cable Companies must understand that broadband access has become an important service for the consumer, even ahead of phone and cable. Strategies must continue to evolve to find the next consumer need. Yesterday was triple play, but not anymore. It is a broadband world and cable needs to build mobile accessibility to it and rethink its pricing models. Or like Blockbuster, this may be the start of their decline.

3D Movies More Fad Than Fancy

As I have written previously, I am not a fan of 3D movies, didn't consider buying a 3D HDTV, or have ever found the experience of watching 3D unbelievable. It seems I am not alone. "The novelty has apparently worn off and Americans are now opting for cheaper, less gimmicky 2D movies, such as the recent huge hit 'Hangover 2.'"

Is the economy partly to blame, perhaps. Is it that the experience of watching 3D requires special glass an issue; for me, absolutely. "Because 3D movies are significantly more expensive to attend, and because only a few movies like 'Avatar' have ever really made 3D seem truly amazing. For most movies, it's a lame add-on that doesn't add much." Hopefully, one day there will be a technology that supports a truly 3D visual experience. Once again, Star Trek may have had it right with their holodeck idea.

Entrepreneur Opportunity For Broadband Business

Attention Entrepreneurs! Seeking a continuous source of subscriber revenue? Interested in competing in a business where demand for consumption is only growing? Then have I got an opportunity for you. Because cable companies are fearful that their triple play business model is reducing to a pipe only world, they are seeking to clamp down on broadband usage by their current customers. "With companies like Netflix and Hulu threatening their subscription-cable business, companies including AT&T, Comcast and Charter no longer want to aid the competition by offering consumers all-you-can-eat broaband." And logically it makes sense, only it doesn't satisfy the consumers' need for more streaming. Charging on a per bit cost is reminiscent of the days when phone companies charged per minute for calls.

So who could ideally get into this business to compete with cable and provide consumers with an alternative broadband company. I have a couple suggestions. First would be for the utility companies to consider broadening their business. Electric, gas, and water companies already reach out to every home in their community. Using existing relationships and local service, they could build out a wired and wireless grid to offer competing broadband coverage.

Mobile phone companies could also offer more streams to homes and build out a WIFI platform in their communities. And lastly, let's build out a national WIFI network. No doubt, a subscription model could open up an ad sales opportunity as well bringing an additional revenue stream into the equation.

Clearly the cable companies have something at risk, with cord cutters and cord shavers scaling back their subscription for broadband access only. Offering an "all you can eat model" only hurts the cable subscription business structure. But there are consumers who only want broadband access, inexpensive and accessible. Hence a new business ripe for the taking requiring some capital expenditure to get it off the ground. Good luck. I'd love to help start it.

The Challenge of Vertical Integration for Comcast and Bloomberg

Back in the 1940's, an antitrust case was decided that had long lasting effects on distribution and content. In US vs Paramount Pictures, the courts decided that vertical integration, in this case the owning of both a studio and a movie theater, was illegal. Studios were forced to sell their theaters and an oligopoly was destroyed.

So it is of no surprise that the vertical integration of content and distribution is popping up once again in cable. That was the concern behind the merger of NBC Universal and Comcast and thus rises the latest accusation between Bloomberg and Comcast. "In order to win antitrust approval to purchase a controlling stake in NBC Universal, Comcast promised not to favor its dominant business news network, CNBC, over rivals such as Bloomberg TV. Bloomberg claims that as a condition of the deal, Comcast is obligated to place its business channel closer to other news channels, including Comcast's CNBC and MSNBC."

Smaller studios faced similar troubles. With big studios owning all the movie theaters, smaller studios couldn't get placement of their films. They were in blocked out. And while the media world has changed and digital has opened up distribution alternatives, cable remains the leader at the moment. Limiting or restricting viewership of cable channels is simply history repeating itself; vertical integration causing smaller networks to not get their content in front of audiences. While Bloomberg may have deep pockets to fight this battle, there are other networks paying close attention to this fight so as to demonstrate why they also deserve equal access.

Thus begins another chapter in cable, a fight over antitrust behavior. yes the entertainment landscape may have changed but history is a funny thing; when we don't learn from our mistakes, we repeat them.