DVB-T2 At a Glance

Tuesday, March 26, 2013 – Jing Sui

How do broadcasters keep up with the rapid-fire changes in media delivery?  Many are adopting or rolling out the next generation of the most widely adopted digital terrestrial TV (DTT) standard – DVB-T.  The DVB-T2 standard has established itself as the most efficient DTT standard, which greatly improves power consumption and spectrum use.  Broadcasters will need more ammunition in their arsenals than improved efficiency to keep up with demand for delivery at any time on any device. That, however is a different topic that we periodically address here.

Thanks to more frequent analogue switch-offs and increasing spectrum scarcity, DVB-T2  is being widely slated for next-generation broadcast transmissions with the ability to provide a minimum 30% in increased capacity over DVB-T. The standard was first published in 2009, and the update, T2-Lite for mobile and portable reception, was added in 2011. In countries where DVB-T services already exist, DVB-T and DVB-T2 services are likely to co-exist for a long period of time. As a contrast, in countries that have not yet deployed DTT services, many will leap directly to DVB-T2 instead of first deploying DVB-T. (The exception is Latin America where most countries have followed in the footsteps of Brazil by adopting the ISDB-T standard).

Many countries have already implemented the DVB-T2 standard. A number of European countries such as Italy, Sweden, and Finland launched DVB-T2 services during 2010 and 2011. UK is the first country to deploy DVB-T2 and it’s being used to sell HD OTA programming. Outside of Europe, Nigeria, Kenya, Serbia and many more countries, are expected to follow soon. DVB-T2 trials are also currently taking place all over the globe; more and more countries are considering DVB-T2 services.

Time Warner Embraces Roku and STB Makers Shudder

Monday March 18, 2013 – Greg Scoblete

Last week, Roku, maker of the eponymous media player, announced its third generation set-top box. Aside from its redesigned menu, faster processor and new, headphone-packing remote control, the Roku 3 contained something potentially significant: an app from Time Warner Cable (TWC).

The app enables over 300 channels of live Time Warner programming to be streamed over the Internet to Roku-connected TVs. There's no video-on-demand yet, but TWC says it's coming. Roku owners will have to be existing TWC subscribers using the company's broadband modem to enjoy access. It is the first time the company is allowing its cable lineup to be accessed on a third party connected device, though it does offer live TV streaming on Apple's iOS and Android mobile platforms.

Of course, there are restrictions. You have to be at home to use the app (so no HBO Go password swapping allowed) and you need to be an existing subscriber within TWC's service footprint. But there are benefits, too. The Time Warner video stream gets prioritized – it's not riding over the top like Netflix – so the video quality is high and buffering issues should be minimized, if not killed outright. The user interface is also remarkably better than the grid-style display that greets many of TWC's cable subscribers.

For secondary TVs, the Roku box is effectively a true set-top box killer (at least "traditional" boxes offered directly by service providers) – and herein lies its significance. While many traditional box makers have put their hopes in gateway/client devices to power them through another wave of growth, low-cost retail boxes like the Roku represent a real threat, since they effectively serve as a "thin client" themselves. Throw in a network DVR, and there's little reason for service providers (or consumers) to invest in an expensive gateway at all.

Time Warner's decision to hop aboard the Roku raises other interesting questions about the future of traditional pay TV networks. Today, only subscribers in TWC's service footprint can access the app, yet the Roku box is sold nationally. It's not a stretch to imagine Time Warner offering its content to Roku customers beyond its service area, even if it couldn't guarantee the same quality as it does to its current subscribers. Other TV providers, like Verizon, Dish and others, could follow suit. Live cable TV (with an emphasis on sports and local news) simply becomes another app, like Netflix, competing for attention.

And that raises another, thornier issue for Time Warner: net neutrality. Current net neutrality guidelines prohibit internet service providers from discriminating among different content providers. By prioritizing the video delivery of its own video streaming service, Time Warner is clearly flouting those guidelines. Netflix has already complained publicly about similar behavior from Comcast. Yet without such prioritization, it won't be possible to guarantee the quality of service necessary for the Roku to truly serve as a set-top box replacement.

If the traditional set-top box hopes to stave off this threat, their best hope may not rest with innovative new products, but with the FCC.

Digital Imaging Industry Deploys Parachutes

Monday March 11, 2013 – Stewart Wolpin

It's rare for a mature product category on the downhill slide of the bell curve to cough up not one but two new savior gadgets within a relatively short time frame. But that's exactly what has happened in the digital imaging business.

Smartphones clearly have become the go-to digital imaging solution for most consumers. Even at the recent presidential inauguration balls, it was clear from the coverage that most of the formally attired attendees were capturing the once (well, twice)-in-a-lifetime historic moment with their phone cameras.

If these smart and well-heeled folks decide smartphones are "good enough" for moments-of-your-life preservation, what hope does the industry have of maintaining any on-going sales integrity?

As sales of both point-and-shoot digicams and camcorders plummet faster than Felix Baumgartner, sales of compact system cameras (CSCs) and wearable actions cams seem to be acting as the category's parachutes.

The question is whether either or both new products will prove to be a long-term solution for what ails the industry. Or, to illogically conclude our parachute metaphor, if CSCs and action cams can provide the digital imaging industry with a soft landing.

Yes and no, IMHO.

Blowing smoke?

Most of our market research compadres are understandably bullish about the future of CSC, with 2013 sales expected to represent around 6-10 percent of all digital camera sales worldwide, depending on who you ask.

But digital camera makers we spoke to at CES enthusiastically reported CSC sales beyond their expectations. Admittedly, this enthusiasm may have been smoke blowing for the benefit of a journalist, but from the genuine glow of glee these product managers exuded when talking about CSC sales it didn't seem so.

In the past year or so, Canon, Fuji, Nikon, Samsung, Sony and even Polaroid have entered the CSC fray with their own proprietary CSC systems, intro'ing models with even smaller camera bodies than the Micro Four Thirds CSCs originated by Panasonic and Olympus four years ago. And all unveiled new advanced models at CES or afterward due to hit stores this month and next.

All these new CSC camera makers are drooling at the higher margins these shrunken upscale imagers produce. Even the most conservative forecasts see CSC sales catching up to D-SLRs in three years or less.

Sure, CSC sales volume will never approach those of point-and-shoot models a few years back, but that's not necessarily a bad thing. CSC makers will be happy to be rid of their loss-leader point-and-shoots, leaving the low-end feature phone owning market to supermarket camera vendors such as Vivitar and GE.

By 2016, CSC body and lens kits could drop below $300 without an appreciable loss in margins (thanks to increased manufacturing economy-of-scale efficiencies). Combined with trimmer distribution, camera makers could maintain a semblance of historic digital camera revenue levels sans the distribution and support headaches of high-volume/low-margin point-and shoot models.

It's easy to see a future 5-10 years hence in which CSCs represent a plurality of digital camera sales.

What the fashionable X-treme sporter is wearing

Camcorder sales numbers are a greater wreck than the Titanic. With the virtual disappearance of the Flip camera – after all, why spend $150 on a standalone slab-shaped HD camcorder when your smartphone has an equal or better video recorder built in? – camcorder unit sales collapsed, dropping around 25 percent in each of the last three years in the U.S., according to CEA.

The lone pillar propping up the camcorder category is the new small and lightweight "wearable" action cams that mount on helmets or handlebars. GoPro's Hero3 has been the top selling camcorder on multiple Amazon sites worldwide since it came out last fall, for instance. And wearable models from Contour, Liquid Image and Ion also have proven increasingly popular; some industry wags estimate action cams represent around 20-25 percent of camcorder sales.

Just as they took notice of the Flip phenomena, mainstream camcorder makers have taken notice; JVC was the first ski-jumper with its Adixxion wearable cam, followed by Sony with its two cleverly-named Action Cam mountable models (one with Wi-Fi, one without) and Panasonic's A100. No doubt there's more action cam action to come.

But with its limited demographic – extreme sporters – just how sustainable is the action cam business?

Flip cams had a far-wider constituency (everyone) and yet proved to be merely the Pet Rock of camcorders. Action cams have a much smaller, yet admittedly more dedicated, user base. As a result, action cam sales may be more sustainable than Flip cams, but certainly not in the same numbers.

With a limited purchasing public, the action cam niche may not support the number of me-too makers the currently exciting category may attract.

Whether or not the CSC/action cam parachutes prevent an eventual total crash of the digital imaging market remains to be seen. 

No Mad Dash to MPEG-Dash

Monday March 4, 2013 – Greg Scoblete

On March 31, the DASH Industry Forum will release its final guidelines for the MPEG-DASH standard (now dubbed DASH-264). It is a culmination of several years of effort to unify the industry around a single standard for adaptive bit rate streaming: i.e., the practice of dynamically adjusting the video quality of streamed content to mobile devices to account for bandwidth constraints.

DASH aims to unify three disparate adaptive bit rate technologies (Microsoft's Smooth Streaming, Adobe's HTTP Dynamic Streaming and Apple's HTTP Live Streaming or HLS) into a single standard to further drive adoption of streaming video. Yet as of now, only Microsoft and Adobe have endorsed the standard. While Apple has contributed some technology to the DASH standard, it has yet to endorse the final implementation.

This, needless to say, is a major blow.

While Apple's mobile dominance has come under increasing pressure from Android and a resurgent Microsoft, it still dominates the tablet market and will likely maintain a preeminent position for several years yet. A study from video monetization firm FreeWheel indicated that Apple's iOS accounted for 60 percent of mobile video views (Android trailed with 32 percent). Any streaming video standard that does not incorporate Apple is leaving an unacceptably huge swath of the market untouched.

Apple's reluctance to endorse DASH hasn't stopped encoder manufacturers from rallying around the standard, or hailing its inevitability, but it has dimmed some of the optimism that the standard would deliver on its promise of simplifying an operator's life.

Indeed, at CES 2013 enthusiasm for DASH was far more muted than it was at NAB just several months earlier. Rather than an inevitable convergence of disparate standards, some industry players believe that DASH and Apple's HLS may co-exist. This will naturally frustrate equipment and chip makers, who will have to build in support for both standards. It will frustrate content creators and distributors to, as they grapple with multiple formats.

It also raises questions about how Apple uses its dominant market share position. As Michael Vitale observed, the late Steve Jobs relentlessly bashed Adobe for the proprietary nature of Flash while patting himself on the back for embracing open web standards such as HTML5, CSS and JavaScript. Yet by withholding support for DASH in favor of the proprietary HLS, Apple is mirroring the same strategy it complained to Adobe about.

Apple hypocrisy aside, even a slower trot to DASH is unlikely to curb the momentum for multi-screen video delivery. Much like the mobile ecosystem market itself, it's just likely to be more fragmented than many would like.