DirecTV Returns Serve on VOD

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Las Vegas — Using the Internet to deliver movies and TV shows, DirecTV plans this year to launch what it claims will be a video-on-demand service to rival those of cable-system operators.

At the 2007 International Consumer Electronics Show, the satellite provider last week unveiled plans for a service it is calling DirecTV On Demand, which it said will offer more than 1,000 titles when it debuts.

“Video on demand, it will be a big area for us this year,” DirecTV president Chase Carey said at a press conference. “We're looking to bring video on demand to our customers in a way that is user friendly, that really makes it an experience they can enjoy.”

A year ago, the nation's biggest satellite provider first told investors it planned to create a broadband video-download service, then dubbed “DirecTV Flix,” to deliver on-demand movies and other programming to subscribers.

DirecTV's on-demand platform, according to interviews with company officials last week, will be quite expansive.

“The DirecTV On Demand service will allow customers who have hooked a high-speed data connection up to their box to open up a whole world of non-linear, on-demand content,” said Eric Shanks, executive vice president of DirecTV Entertainment.

DirecTV On Demand will only be available to subscribers who have the satellite provider's new-generation, high-definition DVR boxes.

Testing of the on-demand service will start in February, with DirecTV looking to actually launch the service by mid-year, according to Shanks.

But DirecTV has not always followed through on announcements of new services, such as a possible broadband strategy or the rollout of some set-top boxes, for example.

And cable operators have noted that satellite services can't deliver true video-on-demand from centralized TV-programming libraries. Instead, they have to deliver what the cable companies term a “faux VOD” that typically involves downloading content to set-top hard drives. That doesn't necessarily deliver programming instantly, when requested.

“We feel that we offer a superior video on-demand offering, with 3.4 billion views since 2004 alone, and we're continuing to enhance the programming that's available on demand,” Comcast senior director of corporate communications Jenni Moyer said. “We just feel that with the combination of all of that, we're able to offer a superior service, and the other folks are just playing catch-up.”

Nonetheless, DirecTV claims that it has a competitive on-demand offering.

“We have agreements in principle that would give us at any given time more than 1,000 titles, and we haven't launched yet,” Shanks said. “And expect that to grow. I would expect that by the time we launch, we would mimic the best cable VOD system out there, as far as what titles are available.”

The on-demand lineup will include movies, TV shows, HD programming, sports highlights, news and premium services, such as HBO and Starz, according to Shanks.

“At a minimum, it will be exactly what cable has, plus we have rights for things like '[NFL] Sunday Ticket on Demand,' which they don't,” he said. “It will be a competitive offering to whatever is on cable on demand.”

DirecTV's plans don't daunt Comcast. Its HD-VOD platform includes 8,000 programs a month, including exclusive VOD content, Moyer said. And Comcast's HD-VOD offerings will double to more than 200 hours a month this year, she added, via an on-demand service that doesn't require an Internet connection.

“You go to the [Comcast] On Demand menu and you press the button and you have it right then and right there,” Moyer said.

DirecTV also claims it has an edge on cable's on-demand platforms because subscribers will be able to request VOD offerings from the satellite company's web site (www.directv.com).

“The cool thing about this is that on DirecTV.com you'll be able to browse all of the on-demand titles,” Shanks said. “If you're at the office and you want to send a movie to your DVR at home you can do that, through DirecTV.com, and by the time you're home, the movie will be there.”

And, according to Shanks, “Because we're launching from day one with this kind of Internet integration, it won't be too much longer after that — probably by the end of the year — that you'll see us start to have some integration with other Web sites, where you can send video from a particular Web site, like a viral video, to your box.”

DirecTV will transport content for DirecTV On Demand not only via broadband, but by satellite as well, according to Shanks.

“The content will get to the box in the most efficient way possible,” he said. “So some of the content will still be delivered over the satellite, and we're currently doing that today, to our standard-def DVRs. And some of the content will be delivered via a high-speed connection.”

Shanks said he couldn't yet say “which content is going to be which. It depends on the popularity. Obviously, if a piece of content is really popular, it makes a lot more sense for us to push it over the satellite.”

When asked how quickly subscribers will be able to view on-demand content they request, Shanks said: “For some people, you can actually watch it in real time. So it's not necessarily a download service. You can actually begin watching it whenever you want, depending on the speed of your connection.”

DirecTV subscribers who don't have HD DVRs, only a standard set-top, can get a tiny “subset” of the on-demand offerings “pushed” to their hard drives, according to Shanks.

“The ones without the Internet connection are going to get 20 to 30 movie titles,” he said.

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