Trender Research™

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Cutting the Pay TV Cord Part 2: OTT Video Device Options

Last week my wife Kirsten and I announced our plan to “cut the cord” from our Comcast cable TV service. We gave several reasons for this decision including the desire to have a more deliberate TV and movie watching experience that would better fit into our family’s lifestyle. But we also hope to save a few dollars on a TV service which has for a long time now been overkill for our entertainment needs. So far we are only committed to a trial run to see how it goes. If it doesn’t work out--- if we find ourselves missing too many of our favorites shows or the relaxing “lean back” experience of Pay TV--- we are prepared to crawl back to our friends at Comcast and ask for our DVR set-top box back. Maybe FiOS even if it makes its way to our neighborhood during that time. Maybe not.

In the meantime we are committed to share with you our thought process and our journey. As I said last week, we are committed to “eat our own dog food” in exploring what Trender Research predicts will be a growing Over the Top (OTT) video trend in the coming years. What we are researching and will continue to watch is whether the OTT trend largely remains an incremental TV and movie watching option for consumers on top of Pay TV, or tempts many folks like us to “cut the cord.” So we also have a professional motive for cutting the cord since understanding the tradeoffs first-hand will help us better predict what will happen.

Hardware Short List:

This week we are exploring what hardware options are available to us. Here is the short list so far:

• Over the Air (OTA) antenna
While I am exploring options to get OTT video reliably to at least one of the TVs in my home, I am going to make sure that TV has a clear path to the old OTA antenna languishing in my attic. Will it still work? Will I be able to get local TV channels in HD? The answers will go a long way to determining if my experiment in cord-cutting will bear fruit.

• New laptop computer
In some ways this is the simplest approach for OTT video. Kirsten needs a new computer anyway, which she will use for work periods arranged around being the primary care person for the children. We could install the Boxee or Zinc video browser, and also surf around the web for the best content and add these as favorites. We could get Hulu, subscriber to Netflix, and I could see what offerings are available from ESPN.com, MLB.tv, and NFL.com for sports content. We would set up a little table near the primary HDTV in the basement den and move the laptop there when needed. For personal viewing, Kirsten has already demonstrated that she is happy to catch up on some shows from the home office (where her new laptop will be), but this would not be suitable for family viewing or extended watching.

Pros: Ease of installation. Flexibility/mobility. Inherent device for interactive TV and applications (we could just as easily watch Hulu as play Pandora or let the kids to Webkinz).

Cons: Expense ($1500 for a decent new multi-media laptop—hard to justify as a stand-alone device if it was not being used for work as well). Ties up laptop at times when Kirsten might need it for work. I am worried that all the alerts and pop-ups on the PC might interfere with movie watching. Compared to a sleek set-top box, a laptop is a large and clunky device. Potential WiFi interference.

• Roku player
The Roku player started with Netflix streaming and now supports a variety of content including Amazon and MLB.TV.

Pros: Cheap ($99). Ease of install. Easy to use. Small device. Dedicated device (no need to move and reattach). Custom-tailored experience. 50,000 movies and TV shows from Netflix and Amazon.

Cons: Only works on TV it is attached to. Walled garden that limits what you can watch (will we find that too restrictive?). No interactive apps.

• Vudu
Vudu differentiates itself by having the largest menu of HD titles. They offer over 2,000 titles in up to 1080P quality, and another 10,000 movies in lesser quality. The device ensures fast downloads with only a 1 second delay before a movie starts playing. The also use their own HDX streaming technology for quality “even better than HD”, but this needs to be queued up in advance and can take hours to download. Vudu claims their streaming service works fine even over WiFi g home networks. While offering less content that Roku and costing more, they still have more titles than we could watch in a lifetime and their HD content will look better on our primary OTT video TV (a Vizio HDTV).

Pros: Moderate price ($150, though their upscale box costs a lot more). Vast HD content library. Great user interface. Dedicated player. Works over WiFi (extra $80 for wireless kit). Fast download of 720p and 1080P movies. Option to download-to-buy movies (can store up to 50 titles).

Cons: More limited walled garden than Roku. HDX movies take too long to download.

• ZvBox
I admit some bias here since I used to work for ZeeVee, the manufacturer of ZvBox and the company behind the Zinc browser, but I promise to remain objective throughout this OTT video adventure (and I have Kirsten to keep me honest). ZvBox is unique in that it leverages an existing PC or Mac computer and streams OTT video or anything on your computer to all the HDTVs in your home via a newly created TV channel called Zv. The neat thing is that ZvBox uses the existing coaxial cable in your home to distribute HD video, in the same way your cable TV signals make it to your home TVs. The new ZvBox 150 adds component video inputs to turn any AV device in your home into a TV channel that can be “localcast” across coaxial cable to your home’s TVs.

Pros: No device in the living room (just connect to coaxial cable). Widest range of content on the Internet (short of hooking up a laptop directly to your HDTV). Sleek Zinc browser interface. Can also check email, browse the web, view photos, play music, or anything else you could do at your computer. Comes with touch-pad enabled remote control, or you can buy a wireless keyboard.

Cons: Expensive at $499 (though you can buy it for less than $400 if you shop around; ZvBox 150 costs $999). Difficult to set up. Some video blocking problems if not properly set up. Some delay in entering data via the remote control or keyboard.

• Popcorn Hour
The Popcorn Hour box by Syabas is more geared to technology enthusiasts, since it boasts a huge array of streaming and media playback options but can be complex to install and use. Among its capabilities Popcorn Hour can sniff out your networked digital media and stream it to your HDTV, including DVD avd Blu-ray movies, MP3 files, and photos from Picasa and Flickr.

Pros: Does a lot more than just play movies. Supports Windows Media, Xvid, H.264 and QuickTime Internet videos. Display local digital photos as well as those on Picasa, Flickr and Photobucket. Plays MP3 music files and streams thousands of Internet radio stations. Plays videos from YouTube and Blip.tv, podcasts and news from MediaFly, ABC, NBC and the BBC.

Cons: Complex to setup and use. Acts more as a streamer and player of other sources of content, not as much a dedicated movie streaming service. You are on your own for support.

Next week we will explore in more detail what content options are available online, and do a comparison to our favorite Comcast TV shows and movies on demand.

Please contact me about OTT Video or IPTV consulting opportunities including product strategy, custom research, speaking, webinars, white papers, etc.: bmahony@trenderresearch.com.

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