Viasat Ukraine was founded as Vision TV, LLC in 2006. Based in Kiev, it is the first and only nationally licensed provider of satellite TV in Ukraine. Viasat Ukraine is jointly owned by the Swedish-based Modern Times Group (MTG) which operates primarily in Scandinavia and the Baltic region but also across Central and Eastern Europe, and the Strong Media Group (SMG), a leading supplier of digital satellite receivers, based in Austria. The Viasat Ukraine DTH service was launched in April 2008.

Viasat Ukraine’s premium service breaks new ground in Ukraine by offering completely new types of services for this market. Subscribers now have access to Ukrainian, Russian and international pay-TV channels in one complete pay-TV package.

Viasat Ukraine turned to NDS to provide VideoGuard® conditional access, MediaHighway® middleware as well as a Ukrainian language electronic program guide.

Viasat Ukraine’s CEO, Richard Caproni is an industry veteran. He has headed Vision TV since the platform’s inception in 2006. Ukraine’s first DTH service operates under the Viasat brand. Caproni has previous experience in pay-TV in Ukraine as the top officer in charge of creating Volia Cable, Ukraine’s largest cable operator and the country’s first digital cable TV service. He was also in charge of the launch of the first broadband Internet service in Ukraine, Volia Broadband.

For the past 10 years Caproni has led the creation of new entities in different industries in emerging markets through his work in private equity, as an adviser to both the World Bank and USAID (Agency for International Development), and as a management consultant to several Fortune 100 companies.

Caproni recently discussed with World Vision the state of Ukrainian pay-TV including the roles that Viasat Ukraine and NDS are playing in making new types of content available to consumers in this emerging market.

World Vision: Tell us about the development and growth of your platform.

Richard Caproni: Vision TV was founded in Ukraine in 2006 and is the product of initiatives from the Strong Media Group (SMG), whose subsidiary Strong International is a leading supplier and distributor of set-top boxes throughout Europe and other markets with offices in 35 countries. SMG’s affiliate, Strong Ukraine, has more than eight years’ experience as the leading local distributor of digital pay-TV receivers (both satellite and cable). The idea was to meet the need for a quality DTH service in Ukraine – a need that Strong Ukraine saw each day.

With this background SMG developed a dynamic business plan and assessed a number of potential partners before launching this platform. They chose to enter into a partnership with the Modern Times Group [MTG] which operates DTH platforms primarily in Scandinavia and the Baltics and broadcasts about 50 of their own branded channels in 24 countries, reaching 100 million people. This partnership is based on a common vision and an equally pragmatic approach to business.

SMG’s local sales and distribution experience, combined with MTG’s expertise in operating DTH platforms and providing content, resulted in the ideal partnership for the Ukrainian market.

How would you describe your relationship with Viasat?

All of MTG’s resources have been made available to us to help build our business. The venture has benefitted from the expertise of their specialists in technical fields, as well as their sales, marketing and customer service experts.

What have you gained by joining with Viasat?                

In addition to their expertise in Central and Eastern European markets, Viasat’s role as a leading content provider ensures that the platform will always be able to make the best content available. We chose to launch under the Viasat brand in order to leverage their reputation as well as their marketing materials to achieve more impact in the market more quickly.

“We are the first DTH pay-TV platform in Ukraine which means we have to build the brand’s local reputation. The Viasat brand gives us a headstart in the local market,” says Richard Caproni, CEO of Viasat Ukraine

Can you describe the pay-TV market in the Ukraine and where you fit in?

The pay-TV market in Ukraine is in its infancy. There is a small number of cable operators providing a quality product but you have hundreds of other cable operators who are offering a primitive, small, analog package with minimal customer support.

“We anticipate that the Viasat brand – which means being connected to a strong international player – will help us educate the market to understand what a quality, full service pay-TV platform is all about.”

What is the potential of your market and what does Viasat offer?

There are more than 17 million TV households in Ukraine. Our primary focus is the more than 10 million who are currently watching analog terrestrial TV. Our basic package, Viasat Family, is relatively inexpensive [about $10/month]. This gives subscribers access to about 40 channels including local channels, some Russian pay-TV channels as well as international pay-TV channels, usually with localized voice-overs. In addition, subscribers have access to the main international news channels in all the major European languages.

Viewers who want more can subscribe to Viasat Prestige for less than $30/month. This provides access to more than 70 channels in Russian and Ukrainian language, 10 movie channels as well as sports and adult programming. We have the strongest movie line-up in the market and we aim to keep it that way. 

The Viasat channels, which are well established in the market, are central to our strong content offering. In addition to the initial channels - TV1000, TV1000 Russkoe Kino, Viasat Explorer, Viasat History – we launched Viasat Sport on June 2. We plan to launch more proprietary channels in the near future.

A year ago Vision TV became the first licensed DTH satellite pay-TV provider in Ukraine. What does this mean for your business?

The market in Ukraine currently presents both an opportunity and a challenge. The opportunity in the near future is to provide an uncomplicated quality pay-TV solution to the millions of households that have never subscribed to a pay-TV service before.

“The challenge is for us to stay focused on our core market before going after niche markets.”

Is piracy a serious problem in your market?

At present the amount of piracy is minimal. What we have instead is ‘unofficial viewing.’ This includes viewers of ‘grey market’ satellite services from neighboring countries. According to some estimates, about 30 percent of the 5 million cable TV viewers in Ukraine also view content unofficially.

NDS originally provided VideoGuard conditional access, MediaHighway middleware and an EPG in Ukrainian. What made you choose NDS technology?

We had several reasons for choosing NDS: The EPG and the future technology roadmap as it can apply to our platform were just as important in making our decision as the security.  

“We chose NDS to provide conditional access because of the company’s proven track record of quality and security. Ukrainian pay-TV has a history of piracy and we feel that NDS offers the best solutions to protect our business. That made NDS the logical choice for us.”

How effective have NDS solutions been in keeping you ahead of the competition?

We believe that MediaHighway middleware and the NDS EPG will give us a strong competitive advantage to be able to launch new services more quickly. We also have the advantage of being able to piggyback on Viasat’s technology platform. For example we’re currently looking at ways to adapt Viasat solutions in Scandinavia and the Baltics for Ukraine. This applies mainly to high definition broadcasts and DVRs. The challenge, of course, is to introduce market-leading innovations quickly and cost-effectively.

What else has NDS enabled you to offer?

MPEG 4 in STBs is at the top of the list. Our strategic decision to switch from MPEG 2 to MPEG 4 was made possible because the right product was already in development at that time. This significantly reduced the cost of the STB. The Viasat STB is the first MPEG 4 SD box in Europe. This allows us to economize significantly on satellite transponder space by fitting more than double the number of channels on one transponder. The result is a dynamic channel lineup at price points in line with the Ukraine market.

What has been the effect of the ability to allow free-to-air (FTA) channels on your STBs? 

Free to air capability will help us capture a healthy portion of this market that today uses FTA receivers. This totals more than 1 million viewers overall. It also includes the sale of an estimated 100,000 receivers annually. NDS’ ability to adapt our STB solution to allow FTA channels has enabled us to improve our content offering while helping make it cost effective. FTA functionality allows us to offer over 20 Ukrainian channels plus several international news and Russian FTA channels right into our main channel line-up without bearing the uplink and satellite costs. These channels are quite popular with our viewers.

Who makes up your team? How do they find working with NDS?

Our team is dominated by local professionals for whom pay-TV is a new area of expertise. Thanks to both shareholders, Strong Media and MTG, we have been able to bring in world-class experts to share the expertise learned from other markets and bring them up to speed quickly.

For example, we have recently hired a new COO who previously worked for Viasat and our new CTO worked for Bell ExpressVu, [a leading pay-TV operator in Canada].  

Where do you see Viasat Ukraine headed in the next few years and what part do you expect NDS to play in your future?

We expect significant benefits from our early advantage as the first real DTH platform in the market. We plan to hold on to our leadership position by making sure we provide the best content to the market as well as by leveraging our partnership with NDS to stay at the forefront of technology so that we are always poised to adapt to viewers’ demands.

In her position as NDS Vice President, Worldwide Development Practice, Alison Vincent has a variety of responsibilities that may sound unusual for a person with a Master’s degree in computer science and a Ph.D in cryptography – both from London University.

She is responsible for improving engineering practices and for facilitating cross regional cooperation within NDS.

What does this mean?

First, the background. “NDS currently has more than 2,500 engineers in seven major regional centers,” she explains. These centers are located in the UK, Israel, India, France, Korea, the US and Denmark.

“As the company grows, a significant number of our development projects are spread around the globe,” she says.

“This means it is vital for NDS to ensure that these projects progress seamlessly and operate effectively. It’s also good for customers to have an R&D center that is relatively near to them, no matter where they are,” Alison Vincent says.

In order to improve engineering practice and foster worldwide cooperation, Vincent has spearheaded a number of key initiatives.

R&D Charter: Best practices

First is the R&D Charter, a virtual manifesto for quality development work. “This is a framework for improvement,” she explains. It is an amalgam based on the best engineering practices she has found within NDS and in other companies. “The Charter establishes the expectations we have for engineers when they write software. It doesn’t matter where they are located,” she says, “they now follow similar guidelines.”

The overall concept is to generate an attitude for continuous improvement so that all NDS R&D groups have development roadmaps and plans which continually “raise the bar” for best engineering practices. “Once a particular group or region meets the specifications in the Charter they can move on to the next step,” she says.

“As our projects expand to meet the needs of our customers worldwide, we identified a global requirement to set and maintain the highest standards possible, and that these should be consistent across our global operation,” she says. “We also realized that when engineers switch projects they shouldn’t have to learn everything all over again.”

“NDS is a powerhouse of engineering. What we want to deliver with the R&D Charter are the best solutions for our customers.”

Vincent explains that the Charter has 15 points. These include how to start and how to finish a project as well as basics for writing effective code.

“The Charter doesn’t include anything our people don’t support,” she says. “What it features are the practices that a mature professional community should be using.” One of the results of the Charter was a process of self assessment. “This isn’t a matter of being audited externally,” Vincent says. “The principle is for development teams to gauge themselves against the Charter and see where they need to improve.”

How are engineers at different levels in different countries relating to the Charter?

“We recognize that different teams brought different levels of professional experience to the table. What the Charter does is put everyone on an equal footing. What we’re aiming for is constant improvement in engineering practice,” she says.

Communications for a global community

Another important initiative which Vincent set in motion is building strong communications within the NDS global engineering and development community. “For example, we have a professional newsletter with all articles written by NDS engineers.” The goal is to share ideas globally. “Having a newsletter helps create connections between engineers and teams,” she says, “while providing visibility of local core best practices, for the benefit of all. Basically, the newsletter enables one region to understand how another region tackles and solves a problem. When one region succeeds with a certain practice it encourages another region to try it,” she says.

It is not surprising that the articles are quite technical. They include subjects like code reviews, root cause analysis and reviewing code quality metrics. “These articles present ways of solving problems. The result is that our development teams share with each other regardless of their location.”

“Ultimately, NDS development teams cross multiple time zones, cultures and (have different) pressures,” she says. “I think it’s essential to utilize the corporate infrastructure to build communities based on common interests.” This includes online forums and debates for engineers to discuss issues and using videoconferencing to build relationships.

Developers Conference helps build relationships

The NDS Developers’ Conference is Vincent’s most established initiative within the company. At this event, held every 18-24 months, about 200 developers meet face-to-face for two days of discussion, debate and information sharing, she explains. “Invitations to the Conference are extended in recognition of technical excellence in NDS projects.”

The result of these conferences is that NDS engineers meet with each other, and form the basis for long-term collaboration. This helps build personal relationships which are essential between, for example, developers in the US and India where there’s a big time difference. “The result is that the next phone call is that much easier,” she says.

“The bottom line is that we are introducing a more human side to a very technical community,” Vincent says.

“As an R&D community, we encourage people to look at the efficiency of what we do. We’re combining the best practices and making the whole as efficient as possible. The end result is cutting down the time involved to deliver the best products possible to our customers.”

As for the future, I expect this process to shape how we distribute work within NDS in all of our R&D centers and on all of our projects,” she adds.

“What we’re trying to do is make our development process smarter. By maximizing the efficiency of our resources it will improve our time to market with new solutions for our customer base,” she says.

Interactive TV in the United States has had more starts and stops than a commuter train during rush hour. But with tru2way that’s about to change.

At the National Cable and Telecommunications Association’s (NCTA) Cable Show ’08 in New Orleans in May, tru2way was a dominant theme. It spilled out from conference sessions onto the exhibition floor with roughly 20 demonstrations that focused on tru2way. There was also a pre-Show conference co-sponsored by the NCTA and CableLabs.

The fact that the vendor community was showing so many tru2way applications, as well as ETV (Enhanced TV) and EBIF (Enhanced TV Binary Interchange Format) applications, is evidence that US cable operators are finally getting down to brass tacks when it comes to deploying interactive, tru2way services for their subscribers.

During a panel session at the conference, Marwan Fawaz, CTO of Charter Communications, was asked what technology or products would be the most transformative for the cable industry.

“tru2way is the most promising area for cable,” Fawaz said. “It standardizes on an open platform that is Java-based so that developers can start taking advantage of the platform because there’s still a lot we can do with it.”

Introduction to tru2way

Tru2way was originally part of the OpenCable initiative that CableLabs launched in 1997 to promote the deployment of interactive services over cable. OCAP consists of a stack of middleware software that resides between applications and the operating system within a consumer electronics device such as a set-top box or OCAP-compliant TV set.

Java-based OpenCable devices can have new information or applications ported to them because of their two-way capabilities, with ETV and EBIF being designated as lighter weight applications that can run on legacy set-top boxes before porting over to a full OpenCable environment.

For developers, content providers and broadcasters, OCAP holds the promise of “write once, deploy everywhere,” as opposed to writing to various proprietary platforms.

OCAP was based on the European Globally Executable Multimedia Home Platform standard, but while MHP found its way into customers’ homes around the globe, OCAP has pretty much languished in the United States.

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Comcast: heading for total tru2way capability

Comcast, the largest US cable operator, is working on a three-pronged approach for interactivity that includes EBIF and ETV applications which can run on legacy set-top boxes and which can be ported into OCAP boxes down the road.

Roughly 60 percent of Comcast’s networks will be ETV-enabled by the end of the year and it will have tru2way network capability in 98 percent of its network by the close of next year, according to Sree Kotay, Comcast Cable’s Senior Vice President and Chief Software Architect. Comcast expects 15 percent of its total devices to be two-way by the end next year while 50 percent will be Java-capable in the same timeframe.

“We think that tru2way is a game changer for us in terms of our ability to innovate on the software features. If there’s a theme for us around tru2way it’s that software is important, experience matters, and we have to move to a layered model if we want to deliver innovative experiences to our consumers,” said Comcast’s Kotay.

Time Warner: Gearing up for tru2way

At one of the tru2way panel sessions in New Orleans, Bill Helms, Time Warner Cable’s Vice President, Subscriber Equipment, said his company has OCAP installed in 40 percent of its footprint across 16 operating divisions in various regions with 900,000 subscribers and 1.1 million set-top boxes. Time Warner Cable is the second-largest cable operator in the US.

“We’re going to continue our OCAP rollouts to the rest of our markets as fast as we can, Helms said. “We’ll continue to innovate. The two primary innovations we’re most interested in right now are bringing in EBIF and ETV support as well as bringing in home networking on the OCAP platform.”

Cox: OnRamp applications in 5 markets

Cox Communications, the third largest US cable operator, currently has a version of OnRamp deployed in five markets. Cox’s OnRamp applications include an e-mail viewer, news, weather, horoscopes, movie listings and sports. The list continues.

Cox has completed two tru2way technical trials and expects to deploy the technology heavily in the first half of 2009.

“There are many hopes and expectations for the use of tru2way,” said Steve Necessary, Cox’s Vice President of Video Product Development and Management. “I think of tru2way as doing for set top boxes and retail devices what Windows did for PCs.”

From the consumer’s point of view, the ability to access Internet content on their TVs is essential. Unfortunately it’s not a great tool for finding content. The reverse is true of PCs. However, through home networking and tru2way, customers will have the means to access various types of content across multiple devices.

“Television is not always the best way to discover content,” says Comcast’s Kotay, “so there are some obvious concerns that pop up in terms of user interaction, content sharing and content discovery. This is especially true when you start to have . . . hundreds of thousands of (video) assets available to you.”

Guides get tru2way makeovers

One area in which tru2way is expected to have an immediate impact is electronic program guides (EPGs). For anyone who has ever had to click their remote control numerous times to find a movie in the current grid-like guides, the tru2way guides will be a truly liberating experience.

Prior to the Cable Show, Cox Communications announced it was working with NDS to design a new set-top box interface that will allow Cox’s digital customers to access all of their digital TV services through a single, interactive user interface (UI).

Cox has designed an interactive UI for existing and new set-top boxes that it said will be deployed widely next year. Cox also said the new UI is compatible with most of its existing set-top boxes and was also designed to be compatible with tru2way enabled services.

The NDS interface will start out on Cox’s OnRamp deployments with the goal of moving it over to tru2way once Cox’s network is ready.

“It is noteworthy that our recent announcement of a ‘next generation’ user interface is being designed to run only with the OnRamp and tru2way environment. That is a powerful indicator of our commitment to and expectations for that environment,” Cox’s Necessary said.

tru2way: It’s complicated

With all this enthusiasm, why has tru2way struggled in the US cable market? First off, as many cable operator employees will tell you, it’s complicated. Aside from the OCAP middleware, there’s the complexity of operating systems and a host of other technical hurdles.

And then there was the issue of the Consumer Electronics Association which advocated its own technology, called DCR+, for interactive services. Cable operators in the US opposed DCR+ as too costly and instead put forth tru2way, or the OpenCable Platform, as the best way to provision interactive digital and HD video services.

Recently the pendulum has swung in tru2way’s favor. In May, Sony signed a new memorandum of understanding to develop tru2way with CableLabs and the six largest cable operators in the United States. Then in June, Panasonic, Samsung, Advanced Digital Electronics (ADB), Intel and Digeo also signed the new memorandum of understanding.

Cable operators that have announced support for the tru2way platform on their networks are Comcast, Time Warner, Cox, Cablevision, Charter and BrightHouse Networks. Together they represent over 80 percent of all US cable subscribers and 105 million homes.

After 11 years of incubation, it seems that tru2way is poised for flight. Stay tuned.

The author is based in Colorado and has been reporting on the telecommunications industry since 1999.

Does this sound familiar: “I just missed the latest episode of my favorite TV show. I wonder where and when I can see it next.”

It’s true, you can Google the show in question but that would probably give about a million search results and the information you need would probably appear on page 24,152.

So is there an alternative? Now there is. LocateTV, developed by NDS, finds individual shows in the viewer’s area better than any other website.

LocateTV is seen as a natural extension to the suite of technology solutions which pay-TV operators all over the world rely on to secure and enhance their businesses. “NDS already provides parts of the broadcast headend for many of its customers,” says Colin Davies, NDS Technical Director, New Initiatives. “We also have vast experience with TV program guides and schedules on subscribers’ set-top boxes.”

Leveraging this unique background, LocateTV was conceived as a search engine with a difference.

Online recommendations

Many people read blogs or Web forums where people discuss or recommend a particular TV show, movie or actor. The problem for the reader is how to find where they can watch this content locally to where they live. In the online world the person recommending a program may be in another time zone or even another country.

LocateTV was created to solve a problem: It connects people who are discussing content to the place where they can actually view the content.

Recently launched in the US and UK, LocateTV features the most comprehensive database of TV episodes and films on TV and, in one clear location, presents the availability of all the viewing options covering broadcast TV, TV on the Web as well as DVDs.

Why is NDS developing LocateTV? “It puts NDS in a position to help our customers and create new partnerships,” Davies says. “One of the trends NDS recognizes is that in the near future viewers will be consuming content from a variety of IP-connected and other devices. Finding content on all of these different devices is a major challenge,” he says.

The fact is there is already a trend for TV viewers around the world to watch content online. As a result, more and more broadcasters are making TV content available on both broadcast TV and online.

How does LocateTV work?

“Locate TV provides more than just TV shows and film titles,” Davies says. “Viewers can choose to focus on specific actors and it tells them where and when they can next be seen in the city or town where they live.”

“At present we’re pulling together information about TV schedules, TV on the Web and DVDs for the US and UK. Eventually we will include more regions around the world,” Davies says.

The challenge is to “bind all this information together so that when someone on a blog mentions a particular program, we inform their readers where this show is available in a wide variety of different locations,” Davies explains.

LocateTV helps viewers in one region find the same show that was recommended by viewers in a different region. In addition, viewers who are online can do more than just recommend a show. Now they can use LocateTV ‘embeds’ to tell viewers where and when they can watch it in their own location.

“What LocateTV does is give each viewer the relevant viewing information. There’s no point in giving information about a channel the viewer has no access to.”

What makes LocateTV better?

LocateTV is clean, fast, accurate and more comprehensive than other sites intended to provide similar services. Viewers type in the name of the TV show or actor they want to see, and in seconds, they get all the answers they need.

“We have designed LocateTV to be easy to use,” Davies says. Viewers can cut and paste content and even embed updates dynamically into a home page or blog so that their contacts can know when their favorite show or actor is next to appear on TV.

An entire TV series, a single episode, or a particular actor can all be embedded in a blog or forum.

LocateTV’s TV Tracker function enables viewers to follow their favorite shows by setting up a personal list. Whenever they visit LocateTV, they can access a list that is accurate up-to-the-minute.

What about the future?

Even though the LocateTV public Beta phase launched less than a year ago, new features are constantly being added. LocateTV currently partners with The Wall Street Journal, The Times Online and Rotten Tomatoes (the film review website).

“Our team of developers and designers is constantly working on new features,” Davies says. “We are committed to improving the data so that, for example, Orlando Bloom fans will be able to find when he is next appearing on talk shows in their broadcast area as well as in his movies.”

The improvements to the site are constantly being developed and deployed Upcoming features include:

• Personalized alerts: User registration will enable viewers to receive personalized alerts about their favorite shows transmitted to their PC or cell phone.

• Book to the viewer’s DVR: Now DVRs can become even more useful by programming them to record shows that were booked via LocateTV.

• Better search: Making the search experience enjoyable is a matter of principle for LocateTV. Plans call for introducing new ways to help viewers find exactly what they are looking for.

“This is a new initiative for NDS,” Davies says. “It is based on the convergence of online media with the broadcast world so that viewers can access content wherever they are. It’s a dynamic, international, and universal, electronic program guide,” he says. NDS hopes that LocateTV will bring a whole new world of possibilities to the search, and, critically, the discovery, of content.

For more information: http://www.LocateTV.com

Is the success of VOD also responsible for holding it back?

Something has shifted in the positioning of VOD in Europe. You could tell as much from the apparent change in attitude of cable executives during the Spring conference season. When on-demand services were first launched in the UK, for example, the talk was of increased revenues as people turned to the new means of program delivery in ever increasing numbers. But now, the PowerPoint presentations seem to talk much more often about churn reduction.

You can always tell how well an operator is doing based on the amount of information that is publically released over and above what is required by the financial regulators.

Operators will speak of how many thousands of VOD views have taken place on their systems. The trouble is that at this early stage of the evolution of VOD, with consumers still navigating their way through the new sea of content, there is absolutely nothing that the viewing figures can be compared with in order to assess the success and impact that VOD has had on the TV industry, and on people’s lives.

Is it the same with online services? ITV.com and ITV’s affiliated local websites have increased their video views by 21 percent month by month with 12 million video views recorded in May alone. But these numbers do not indicate that ITV is doing better or worse with its online service than its competitors. All we really know is that all such services are growing in popularity.

Does VOD reduce churn?

The story now emanating from cable is more that VOD is the service that will reduce churn on the operators’ networks rather than being a compelling must-have that will directly result in increased revenues.

The role of the free VOD services must also be examined. Is the BBC iPlayer and its international equivalents elsewhere in Europe - RTL Gemist, and ARD Mediathek - the solution or the problem? In Belgium, Telenet has used its relationship with the public broadcaster VRT to promote the paid-for elements of its TV-theek VOD service. The free content is largely restricted to the evening news. Subscribers have to pay an additional fee to get anything extra.

In fact the VRT offers its whole range of on-demand programming for a flat monthly fee of €5.95, which gives access to all drama, series, entertainment, documentaries and other programming. However, the commercial stations rely more on pay-per-view, with prices ranging from €0.50 for a series to €2.50-3.00 for so-called ‘reviews.’

Not every public broadcaster is permitted to charge for its content. The BBC for one is obliged to make its content available to the widest audience possible free of charge, and somewhere along the line seven days has become the window during which content is made available to all before BBC Worldwide is allowed to explore its commercial possibilities.

Time-shifted vs. on demand

In an attempt to stay ahead of the game, US cable operators have begun to replace some of the time-shifted channels associated with their premium brands in favor of on-demand services.

In a revenue-sensitive move, this only applies to channels that are not supported by advertising and there is no suggestion that any operator is about to embark on a mass switch-off of popular services.

However, it is the logical move for any operator to remove under-performing services from its portfolio of offerings. Therefore, a reliable indicator for VOD has to emerge, be it a reduction in churn – and a decline in churn of two percentage points seems to be the most cited statistic among cable operators – or higher revenues.

Innovative possibilities

There are other techniques that are being tried out to drive VOD forward. “Startover TV” or “Replay TV” allow subscribers to watch a program from the beginning if they happen to arrive home from work late. Effectively, this is taking the buffering seen on digital video recorders and extending it across the channel portfolio, at least in cases where there is an agreement with the broadcaster in place that allows this.

Broadcasters are happy because this arrangement ensures there is no fast-forwarding through the commercials. Some operators are looking at selling the breaks a second time.

Day & Date, where movie content is released to operators at the same time that the DVD is made available in retail stores, is seen to be a good way to drive revenues. In tests carried out in the Netherlands, movies with this feature generated cable sales more than three times higher than those of similar titles in the library without Day & Date release.

But they would wouldn’t they? In the grand scheme of things, 500 or even 1,000 movie titles isn’t that great a number. Think of the lack of historical depth to iTunes, which will bring you most tracks from the last five years. But if you want to relive the ’80s, let alone the Swinging Sixties, then you’re in trouble.

The catch-up TV services are constantly being refreshed with new content, often on a near-hourly basis. More to the point, the ability of broadcasters to highlight their own VOD services on the air often deafens some operators’ promotions for their own premium content.

By their very nature the content for catch-up TV features characters and storylines with which the public will already be familiar. For this reason they need little promotion other than the words “New Episode.” Contrast that with older movie titles that cannot claim to be blockbusters, and consequently need to be introduced to their audience by way of a trailer, not to mention the need to quote the required payment. This challenges the digital platforms to come up with a proposition that is more than simply slicing another piece from the same cake.

Julian Clover, based in the UK, is Editorial Director and European Digital Analyst for Broadband TV News.