Monday October 17, 2011 – Greg Scoblete
As someone with little interest in watching TV on the TV, I've never quite understood the appeal of watching it on devices that are not the TV. But I also understand that my tastes are hardly mainstream and are probably downright un-American, and so the "TV Everywhere" trend gains steam. As it does, it raises an inevitable question: if you can indeed watch TV everywhere, what becomes of the set-top box (STB) market?
In the past few weeks, its turf has definitely been assailed. Microsoft fired a volley with the announcement that it would offer both free and pay TV on the Xbox 360 gaming console. Among the providers lining up to offer their content were some big names: Comcast, HBO, ESPN, Bravo and SyFy. The TV functionality isn't confined to the states either, with European providers, such as BBC, Canal+ and Lovefilm signing on.
The Xbox deal doesn't sideline a pay TV STB - at least one box would be required in the home to deliver programming. But it might convince some consumers to forgo a second box for ancillary TVs used for gaming. Economically, it's something of a wash: to access pay TV on the Xbox 360 requires a $60 annual subscription to Microsoft's XBox Live, about what you would pay per annum to rent a basic STB. The Xbox itself probably couldn't push the needle on STB shipments, but if Sony and Nintendo hop onto the bandwagon, that's another story.
DirecTV also made a move to disperse its programming to mobile devices with a product that's, dare-we-say, slightly Slingbox-ish. Dubbed the Nomad, this small STB lets consumers view DVR-recordings on up to five mobile devices. It can't stream live TV but can automatically sync DVR recordings with mobile devices.
Outside of devices, apps have been proliferating that let users view TV on their mobile phones and tablets. Not every content provider is enthusiastic about TV Everywhere, however. YES is battling Cablevision over the latter's iPad app, saying its programming cannot be distributed to mobile devices outside the home (a stance echoed by Viacom). But clearly more pay TV providers are looking for alternative means to give their customers their TV fix beyond the set top box.
Does this mean STB shipments will wither? Probably not in the short-term. TV Everywhere is aimed at out-of-home viewing - for those forlorn commuters stuck in a train or an airport. If you have access to a secondary TV in the home, it's unlikely you'd pop open the iPad to squint through the latest Mad Men. In the longer term, if the Xbox experiment proves successful and other game systems and content providers saddle up, it could make it easier for service providers to skip additional box installations. There's a clear benefit there for the pay TV provider - fewer boxes to inventory - and for the consumer as well, as they'll be one less device cluttering up the entertainment center.
But in this instance, content is king. Despite the impressive roster of names, the Xbox still doesn't boast the kind of channel line-up your average pay TV consumer has access to.
