TV Everywhere’s Unfinished Business

Over the past three years, the multichannel-TV industry has rallied around TV Everywhere as the best way to please both subscribers and Wall Street. But the idea of offering subscribers more content on more devices without disrupting the traditional pay/cable business model remains a work in progress.

Viacom Media Networks now has six authenticated sites up and running, reaching some 45 million pay TV providers, senior vice president of content distribution and marketing Tom Gorke said. But like most of the 15 analysts, multichannel providers and programmers interviewed for this year’s Viewer Watch report, Gorke acknowledged that expanding the reach of these offerings “has been slow going.”

“It has not, by any stretch of the matter, gotten widespread adoption,” Gorke conceded.

That isn’t to say there hasn’t been considerable progress. Over the past year, Comcast, Time Warner Cable, Cablevision Systems, Cox Communications, DirecTV, Dish Network, AT&T and Verizon Communications have all notably expanded the amount of content available via their TV Everywhere offerings.

“We have made significant progress in offering a tremendous amount of content and now offer content from over 100 different networks,” Comcast senior vice president of digital and emerging platforms Matthew Strauss said.

And AT&T reports that the TV Everywhere component of its U-verse TV now streams content to about 20 devices, with about 7,900 titles for mobile, 5,500 for tablets and more than 285,000 titles on its website, which attracts more than 1.7 million unique visitors a month, Maria Dillard, vice president of U-verse and video products at AT&T Services, said.

“We are working towards ultimately allowing customers to watch whatever content they want when they are on the go,” Verizon FiOS director of product services Maitreyi Krishnaswamy said. The telco recently updated its mobile app to offer 75 streaming linear channels to Internet-protocol devices in the home.

Looking forward, operators want to add even more live content, according to executives at Comcast, DirecTV and other providers. “The [London Summer] Olympics was a watershed moment,” with more than 1 million live streams served by rights holder NBCUniversal, Strauss said. “By the end of 2012, we will have over 15 nets streaming live, and that is just the tip of the iceberg. As we move forward, we want to include live [events], as well as a vast library of on-demand [content].”

Operators also stressed that TV Everywhere needs to be developed in a way that improves the overall TV viewing experience.

“People are still looking for the best screen to watch video on,” Tony Goncalves, senior vice president of digital entertainment products at DirecTV, said. The No. 1 satellite-TV provider has expanded the content on its TV Everywhere offering from six networks to more than 35 in the last year.

“The second screen is important for convenience or catching up on missed episodes,” Goncalves said. “But we are not seeing deep and lengthy engagement on these devices and we still have to be focused on what happens in the living room on the big screen.”

As part of that effort, DirecTV has rolled out its Genie whole-home digital video recorder, a device closely tied to mobile apps that use social media and other tools to simplify the process of discovering content.

DirecTV has also been actively developing products as a member of the RVU Alliance. RVU technology allows Samsung Smart TVs and other consumer-electronics devices to interact with the Genie boxes, which makes it easier to deliver content to more devices.

Dish Network has also tied TV Everywhere apps into its whole-home DVR, the Hopper, vice president of product management Vivek Khemkha said. The satellite provider plans some major announcements on multiplatform content at this week’s International CES.

For the moment, though, current TV Everywhere offerings tend to have limited content and a number of other drawbacks, Khemkha said. “It is still a very siloed experience that, from a consumer experience, needs to be made very simple.”

There’s no question that the industry needs a common platform and interface for authenticated content, Maryann Baldwin, vice president of Magid Media Futures at Frank N. Magid Associates, said. “These TV Everywhere offerings are very appealing and can provide a great deal of value, but the solutions are not very elegant at this point,” she said.

As part of that effort, operators are increasingly using apps for tablets, smartphones and gaming consoles to make it easier to fi nd and access content. “The advent of these devices has really opened up opportunities for people like us to revolutionize the way people are watching TV,” Verizon’s Krishnaswamy said. “They enable a much more personalized and interactive experience.”

While these apps promise to dramatically improve the TV experience — which in turn could give operators a competitive edge against over-the-top video — a number of business issues must be solved fi rst. In 2012, a number of major programmers significantly expanded the amount of content available as part of TV Everywhere deals, Eric Bruno, vice president of strategic implementation for Verizon, said. “We certainly don’t expect to have any gaps in our TV Everywhere portfolio as we move through 2013,” he said.

But a number of factors, including cost, continue to slow negotiations.

“There is great value in these rights,” Viacom’s Gorke said. “We and other programmers expect some kind of value exchange and that has resulted in things not being lit up overnight. It takes time to work through those issues.”

Paying extra for TV Everywhere rights puts operators in a difficult position with consumers, thanks to the weak economy. “TV Everywhere costs the operator something in terms of their contract negotiations but they have yet to find a way to recoup that revenue,” Ian Olgeirson, senior analyst at SNL Kagan, said. “This won’t be easy because they started out giving the service away.”

Programming costs have also increased the pressure to find better audience-measurement tools. “The goal is to deliver an ad load across all the platforms and devices and also have the ability to dynamically update and change those ads across those devices,” Comcast’s Strauss said.

Here, too, a number of business issues must get resolved. These include the split between operators and programmers for ad avails for content distributed on mobile phones, tablets and computers, particularly after the the three-day and seven-day windows for viewing recorded ads pass.

Because of the lack of broad agreement on these issues, programmers remain cautious.

“There are some deals out there that provide markers as to where this will go,” Fox Networks president of distribution Mike Hopkins said. “But everything is still a little uncertain. We don’t want to have to make 10-year business decisions without knowing where this is going.”

For the complete Viewer Watch 2013 report, please click here.