Cable hopes service gives competitive edge over satellite
MT. DESERT ISLAND, MAINE
With cable operators trying to deploy both HDTV local stations and video-on-demand (VOD) offerings at a faster pace, HDVOD is on everyone's radar screen for a variety of reasons.
With the announcement in late June that Atlanta-based N2 Broadband had enlisted PPV and VOD distributor iN DEMAND as the first content provider to provide HD content using N2's enhanced MediaPath system, there is a distinct sense that momentum for HDVOD is building. But many industry observers do not expect it to really roll out on a broad scale for at least another year or more.
Later this summer Cablevision Systems will start offering a slate of HD movies as part of its iO digital cable service. The company already offers 700 titles and seven SVOD services including a new Anime Network On Demand.
"HDVOD certainly fits the longer-term vision of companies like Comcast, which is being very aggressive in terms of its HDTV rollouts now," says Adi Kishore, media and entertainment analyst at Boston-based Yankee Group. "And yet it is a bit early as there are still enough issues that need to be addressed surrounding the deployment of standard-definition VOD including the marketing and the adding of more VOD content. It is not a matter of technology now.
"At the same time, we may see the deployment of HDVOD sooner than many people think," he adds. "Cable operators are scrambling to differentiate themselves from the DBS satellite companies, and the VOD realm is being propelled at a brisk clip. This is a fast-moving technology, and the N2 Broadband announcement reflects this trend. But my guess is that HDVOD will not appear on a large scale for another 12 to 18 months, at least."
ON TRIAL
A spokesperson for Cox Communications, for example, said that HDVOD is a great technology; but Cox wants to get VOD rolled out more broadly and to deploy HDTV in more markets as well. HDTV is available in less than a dozen of Cox's markets today, a spokesperson said.
Cable operators including Cablevision, Comcast, Cox and Time Warner Cable have deployed MediaPath. Without disclosing details, N2 Broadband said a number of operators will be conducting HDVOD field trials over the next three to six months.
"Our announcement with iN DEMAND is a bold statement of our intent to evolve with the industry. This makes a lot of sense," says Raj Amin, VP of Product Development at N2 Broadband. "We are enhancing our systems in order to drive new services over our existing MediaPath product. In addition, all of our existing OpenStream VOD platform customers are going to be compatible with this upgrade from the software layer."
Amin acknowledges that HDTV encoding rates need to be standardized "Our mantra is open standards," says Amin. The issue of what traffic loads the VOD servers can handle has already been resolved.
"On the streaming side, there is no doubt that the VOD servers can support these HD rates," says Amin. "Also, all the HD set-top boxes will have to support both HD linear and HDVOD content, too. At the same time, this must all fit within the same bandwidth management architecture. You do not want to force the operators to go down the path whereby they end up creating parallel networks for specific purposes."
WASTED BITS
When looking at the viability of HDVOD, other things must be kept in mind. "A VOD server and the downstream bandwidth provisioned for VOD is typically never at peak capacity. Bandwidth that is not used is effectively wasted. There is no current dynamic resource sharing between VOD and other services," wrote nCUBE CTO Greg Thompson in a white paper entitled, "Why HDTV may be the Next Opportunity for VOD," presented at SCTE's Emerging Technology conference in January.
"As server utilization approaches peak capacity, the MSO through its VOD management tools, could determine at session setup time which stream type should be accepted and which should be denied, based on its incremental or marginal cost to provide and revenue it would produce. Yes, the bit-rate of the stream is three to five times greater, but if a high-definition sporting or WWE event at $10 to $25, or a current release movie at $6 to $9 would bring in more dollars than thee to five SDTV library movie rentals at $1 to $2 each, based on historical or expected usage patterns for that time slot and service area you accept the HDTV purchase," Thompson wrote. "The hardware investment doesn't change. You still just add streams to the video server and QAM channels to the service areas as needed to raise the peak capacity and reduce the chance you have to deny any request."
Amin sees operators as quite capable of taking full advantage of the inherent flexbility of their networks via the modification of node sizes or splitting nodes, and driving ever closer to the home in the process.
"The streaming components and storage costs are continuing to decline in cost, while processing power increases, and this only helps our story. On the HD content side, new HD encoding tools must be developed to reduce production costs going forward in order for HD VOD to really take off," says Amin.
"This is an important initiative. It helps to focus HDTV. Aggregating HD content in one place makes a lot of sense," says Richard Green, president of Colorado-based CableLabs, where the current VOD 1.1 metadata standard does not yet include HD.
"I think different MSOs need to consider different strategies based on what competition they see in their market, their local brand, and their network architecture," says Amin. "HD VOD is another great arrow in the quiver of cable marketers, and will be used aggressively where they are seeing significant take-up of other HD services. VOD alone offers great consumer value, so HDVOD may not be necessary in all markets, but we are ready when they are."
