The settop box (STB) has always been a critical part of the
video delivery solution. STBs enable the
SP to deliver many revenue producing services including basic channel line ups,
VOD, DVR, etc. Hence, they love them. STB are about 50% of an SP’s CapEx. Hence, they hate them. As everyone knew,
and Cisco learned when they bought SA, there is constant downward price and
margin pressure on STBs. Vendors such as
Cisco, and now Arris, along with Samsung and others have yet to change the
dialog away from “speed and feeds” and “price”.
Part of this arises from the “old days” where the STB vendor
would not put engineering “pen-to-paper” until they had a signed contract for
millions of units. Armed with this
contract they would then beat the living daylights out of their semiconductor
suppliers. I know; I was one of
them. I felt the large STB vendors (SA
and GI) looked upon this beat down as sport.
They seemed to enjoy it. (See “side-bar”
below)
Even back then I felt the STB vendors and their SP customers
were missing something. They had a
physical box the same size as the current PC that was situated, and visible, in
living rooms throughout the world. I
began looking at them as a Trojan horse.
Competition among service providers and vendors has spurred
many innovations in the market. New
entrants including Intel, Google and Apple as well as many startups have made
forays in to this market. Yet with all
the talk of cord cutting, OTT only
solutions are not enough. Cisco’s
Videoscape presented a story that was all encompassing. Unfortunately, it was only a story. Interactive TV and Apps on the TV continue to
stutter. Surfing the web with a 0-9, up,
down, left, right remote control falls far short of a good user
experience. Social TV stutters as
well. Who wants a Facebook window taking
up valuable TV screen real estate? The
industry has tried to address this in many ways. Yet, adding single purpose boxes such as
Roku, Slingbox, etc. (All irritants to
the SPs) became, among other things, a wiring nightmare for all but those consumers
with structured wiring closets.
All of these problems are individually solvable and many efforts are underway to do just
that. However, I’ve yet to see anyone,
SP or vendor, figure out the real solution.
I though Google had it when they bought Motorola, but was proven wrong
with they sold the video part to Arris.
In Part II, I’ll elaborate on the solution that I believe if
adopted by SPs will give them an economically attractive long term solution to
capture and control the home. This
solution is found at the turbulent intersection of technologies ranging from Video,
Cloud, Mobile, SDN et al and addresses market and business realities, dynamics,
and trends. I don’t mean to leave you in
suspense but few will read longer post since we all have ADD.
Sign up to receive Part II or contact me at 978 992 2203 or
gwhelan@verizon.net
Side Bar (OK it’s not
on the side)
In one meeting at the dominant STB at the time, I had
brought a senior development engineer who was pitching his new component. This new component had features that were
state-of-the-art. The STB vendor on the
other hand had some basic requirements that started with “Two Bucks”. They had architected the box down to each
component and had assigned a dollar value to each and every one. Every
time the engineer went on about some secondary feature such as spurious free
dynamic range, the Director of Engineering kept saying “Two Bucks”. After a few rounds of this I tried to change
the conversation but the engineer kept pushing, what were now tertiary features. It literally took an under the table kick and
the evil eye stare to get him to stop. The
message was “give us the best for performance for two bucks”.
