xOD Capsule Newsletter – July 12, 2006

Sapan urges fare tailored for VOD and hi-def
Athens, Greece – For video-on-demand (VOD) to truly resonate with consumers, operators and programmers alike must create and distribute fare tailored specifically for the platform, rather than simply repurposing traditional shows for the on-demand world.

That was one of the big messages delivered here late last month by Rainbow Media Holdings President & CEO Josh Sapan, the opening keynoter for C-COR Inc.'s 2nd annual Global IP Summit.

Josh Sapan —Photo courtesy of C-COR Inc.

Rainbow, of course, has some serious stakes in the game of building content and brands aimed primarily at the VOD distribution channel. Sapan's company is responsible for VOD services such as Mag Rack and Sportskool. IFC Entertainment, meanwhile, is pushing the needle with a so-called "day and date" strategy that premieres films in theaters and on VOD in the same release window. So far, Comcast Cable and corporate cousin Cablevision Systems Corp. are on board with it.

Sapan said history has shown that the linking of new content with new technologies drives and hastens consumer adoption. HBO, he recalled, helped to put cable programming on the map when it launched in 1972. The rise of the Internet, meanwhile, caused traditional company after traditional company to apply "dot-com" to their names, but it was Web-centric services like Amazon.com, eBay, and Google that really drove higher levels of consumer understanding and usage of the Web.

He said the same will be seen with VOD, which will be "elevated" in consumer circles through the use of original content, rather than by repurposed shows from the linear TV world that are simply leveraged as an "afterthought."

That same strategy, he said, will also benefit high-definition television. Rainbow, of course, is approaching this market with a lineup of about 15 HD channels under the VOOM brand.

In this context, Sapan cited the advent of color television, which didn't take off until Disney and other programmers created shows that showcased (and, in turn, caused consumers to embrace) the new, more eye-popping format.

— Jeff Baumgartner, Editor in Chief, CED magazine and xOD Capsule

A vote for hierarchical storage
While the central vs. distributed approach tended to dominate the VOD architecture debate for a number of years, more and more operators are starting to apply much more attention to yet another—the hierarchical architecture—as service footprints expand and capacity and storage needs rise.

A hierarchical architecture should fit the bill for cable VOD for at least the foreseeable future, according to Doug VanCura, the senior director of advanced video engineering at Charter Communications, who presented a paper on the subject during last month's SCTE Cable-Tec Expo in Denver, Colo.

In the wake of larger libraries, user-generated content and on-demand advertising, the amount of required storage will certainly apply pressure on today's VOD architectures. Additionally, operators may be called on to supply on-demand content in various formats for PDAs and cell phones that are somehow connected to the cable operator's network. Operators will then have to ask whether that content should be stored separately for each type of supported device, or should they create just one copy of it, and then transcode it to the format supported by the different end devices?

"Where that [among of content] stops, it's hard to predict," VanCura said.

Under an "optimal" hierarchical approach VanCura proposed would store 100 percent of the on-demand content in a centralized library, with 30 percent duplicated at the headend, and 20 percent of the most popular or highest value content (ie. SVOD and premium movies) duplicated at the edge. The less popular or more obscure content would be stored only in the primary library.

In addition to applying a disaster recovery scheme (because all content is stored at the main library), this hierarchical method would be designed to keep duplicative storage and content transmission costs at a minimum.

John Pickens, the vice president of technology at Arroyo Video Solutions, who also presented at the show, noted that centralized storage was okay early on because the amount of available content and the number of customers using the service was relatively low. But, as stream counts rise and content libraries grow, that tends to "crunch your bandwidth" under a centralized scheme.

The hierarchical approach, which enlists a middle cache between the main library and the distributed edge servers, enables operators to scale VOD to national proportions, Pickens explained.

Cox's VOD cup now overfloweth
Cox Communications has beefed up its on-demand library after adding hundreds of hours of content from Showtime, Cartoon Network, Adult Swim, CNET, Havoc Television, Union and Studio 4 Networks.

VOD is available to Cox's digital cable customers in several markets, including Orange County and San Diego, Calif; Omaha, Neb.; New Orleans; New England; Hampton Roads, Roanoke and Northern Virginia; Las Vegas and Oklahoma City.

The company says it now has over 1,400 hours of on-demand programming, including over 400 hours in the "free" category.

Japan trio taps SeaChange
Three cable TV operators in Japan, together representing over 600,000 subscribers, are collaborating to deliver on-demand services based on systems and software from SeaChange International.

C-Tech Corp., Chubu Cable and CTY Co. are running a market trial of on-demand television prior to rolling out full commercial service to 20 cities in Japan's Aichi, Gifu and Mie prefectures later this year.

SeaChange's IPTV System has been deployed at C-Tech in Nagoya for a single, centralized on-demand operation that serves the three cable systems over fiber-optic lines.

Midcontinent brings VOD to S.D. with TVN
TVN Entertainment has scored a multi-year deal with Midcontinent Communications to provide an array of VOD content and advanced services.

TVN will distribute and provide aggregation and asset management services for VOD content to all Midcontinent VOD systems. Midcontinent, which serves more than 200 communities in North Dakota and South Dakota, will get immediate access to TVN's new ADONISS 2 system, which allows for complete asset tracking and metadata management.

Heard On The Net…

Five-second selling
In a new age of digital video recording and ad-skipping, advertisers are trying out new ways to ensure that their messages are getting across to viewers. Among those methods are "mini-commercials" that run just a few seconds, according to this recent article in USA Today. The story notes that the concept is designed to take advantage of TiVos and other DVRs that back up a few seconds to compensate for user reaction time when they try to fast-forward through commercial breaks.

Programmers such as ABC, meanwhile, are discussing technology that would disable the fast-forward button altogether, according to this piece in Media Daily News.

We are making changes and additions (including international deployments) to our
Web-based "living" deployment chart. If you have a new deployment to report for the VOD Scorecard and the Web-based deployment chart, please contact CED Editor Jeff Baumgartner.