TelcoTV: Big boys count screens, Vudu counts Mbps

TelcoTV 2008's slate of Day One keynotes offered a look at what might be called the telco TV dichotomy. Big telcos AT&T and Verizon Communications continue to push their three-screen strategies that leverage TV as one piece of the puzzle, while most small telcos who can't afford the brand-building, content licensing or intense integration required to support such strategies must think seriously about joining the likes of broadband media box vendor Vudu to leverage their broadband pipes in the on-demand world.

The Day One keynotes started with a schedule change. Fox TV stations online executive Ron Berryman was scheduled to speak, but he couldn't make it. For the remaining speakers, it was just as well that they didn't have to kindly acknowledge a fellow speaker from the traditional TV world. Dan York, executive vice president for content at AT&T; Edward Lichty, executive vice president for strategy and corporate development at Vudu; and Jon Harrobin, senior vice president of marketing and digital media at Verizon, all talked about revolutionizing the old TV mode.

Harrobin said in his speech, "There are all these predictions of the death of TV. We don't subscribe to them because we are spending billions of dollars to build new platforms. Our contention is TV is far from dead, but one particular model for viewing TV is dying-the network TV model. But with that model dying, a new one is being born."

Both Harrobin and York painted visions of their platforms as continuing the evolution into three-screen universes tied together by interactive portals that customers can control and customize, potentially with Internet-like widgets to their favorite content sources, channels or applications. Such portals will be increasingly supportive of ad insertion and targeted advertising that leverages the viewing and portal customization choices users make.

York said, "Saying entertainment is just TV misses the point. We're not just talking about a service bundle either, but about integration, making services more valuable by making them work for and around our customers. Lessons we've learned are that consumers want choice, they want personalization, they want cross-platform porting. And they need everything to be consumer centric."

Vudu may currently exist outside such closely integrated, highly branded telco TV universes, but Lichty said the company, whose users average between four to six on-demand movie downloads per month, offer telcos who can't build their own universes another option: "As a service provider, do you do it all? For AT&T and Verizon, that's the way to go. Or, do you stick to your pipe and do nothing? That also makes sense for some. Or, do you collaborate with folks who have the right DNA (like Vudu), and develop a deep relationship with intent of providing a better customer experience, and integrate what we do into your service?"

If your company's name is not AT&T or Verizon, the implication is that Door #3 may be the most viable choice. Vudu can help them build their broadband connection into a video pipe that doesn't require Hollywood licensing or a new branded portal, because Vudu has taken care of that. Instead of counting screens, Vudu is counting Mbps: The median download speed in the U.S. is now 2.3 Mbps--21 percent better than last year--and improving.