Comcast Boots Microsoft
Guide Drop a Blow To Software Giant's Cable-TV Gambit
By Todd Spangler -- Multichannel News, 5/20/2007 8:00:00 PM
Two and half years ago, Comcast was Microsoft's marquee customer among cable-system operators.
In November 2004, Comcast became the first operator in the nation to commercially deploy the software giant's TV Foundation Edition program guide in set-top boxes.
Through early 2005, Comcast switched about 1 million digital-cable customers in Washington state to the Microsoft guide. The duo expected to take it elsewhere: Under the terms of the deal, Comcast had the option to roll out the guide on up to 5 million set-tops.
“We're excited about working closely with Microsoft to jointly define the digital-TV experiences of the future and to continue bringing innovative services to our cable customers,” Comcast president Steve Burke said at the time.
So, best friends forever? Not exactly.
This particular partnership will officially come to an end this summer, when Comcast replaces the Microsoft interactive program guide in Washington state with one it designed itself.
The move was widely expected. Comcast has taken over its own product development with GuideWorks, a joint venture with Gemstar-TV Guide International. The partnership has created an interactive guide called i-Guide, which Comcast has said it will use to enhance the “user experience;” for example, by providing easier access to digital video recorder functions and video-on-demand titles.
Comcast appears to have wanted greater control of its own destiny, instead of being beholden to the product-development schedules and priorities of a third-party provider, according to ABI Research analyst Mike Wolf.
All the same, Comcast's decision is a setback for Seattle-based Microsoft, Wolf said. “One of their big wins was Comcast, and the fact that they're being dropped from this wide-scale test in Washington is a blow,” he said. “They lost potentially their biggest customer.”
Wolf also noted that AT&T, the software company's premiere telco customer in the U.S., has reported problems with Microsoft's TV software. “I think the story continues to get worse for Microsoft,” he said.
In a statement, Comcast said it will roll out i-Guide to provide a “consistent user experience for customers throughout the Puget Sound and Spokane areas, as well as in Comcast markets across the country.”
Microsoft shrugged off the development. “This is old news,” said Ed Graczyk, director of marketing for Microsoft's TV business unit. “It's not that big a deal … It was obviously clear that [Comcast was] bringing a lot more of their development in-house.”
Microsoft shifted focus a couple of years ago to the Internet Protocol TV platform, “which we see as the next generation of television,” Graczyk said.
Meanwhile, the company continues to market the product outside the U.S. Graczyk said TV Foundation Edition is the market share leader in Latin America for digital cable set-top guides.
For now, Microsoft's cadre of TV customers are predominantly telephone companies. “It just so happens, when you look at IPTV on a global scale, the telcos are the early movers because they have greenfield environments,” Gracyzk said.
Comcast, in swapping out Microsoft, wants to enhance the guide with a key new feature: In Washington, the i-Guide will feature the Comcast Central “video-rich navigation,” which lets viewers see up to six different live TV channels on the screen at once.
The video-navigation feature, developed by Comcast Media Center, is currently available on about one-fourth of the operator's 19.5 million digital set-tops in various markets, including Chicago and Philadelphia.
“Comcast Central is the perfect addition to help our customers navigate the thousands of viewing choices available to them at any time, while also letting them preview several programs at once,” Comcast Washington vice president of marketing and sales Tom Pierce said in announcing the IPG changeover.
I-Guide is scheduled to launch in Spokane starting June 5, and Comcast expects to complete the rollout in the state to Puget Sound digital-cable customers by early September.
The operator said it is beginning to notify customers of the change through direct mailings and TV, radio and newspaper ads. Customers will also receive messages sent to their digital set-top boxes.
The new IPG will support future “cross-platform” features that integrate Comcast's video, high-speed Internet and voice services, the company said. This could include features such as caller ID on the TV and the ability to program DVRs from any Internet connection.
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