Fog of War

Fog of War

Here we go again. The New York Post reported last week that Verizon Communications is talking with “major programmers” about obtaining rights that will allow it to deliver FiOS TV subscription services outside its franchise areas.

With the threat of “virtual MSOs” from Intel Media and possibly Google on the horizon, such a pursuit makes absolute sense. Technology isn’t really the issue. The hard part is obtaining the off -network rights from programmers.

Not long ago, EchoStar was pitching an over-the-top, bring-your-own rights model to aspiring virtual MSOs. How’s that going? Nowhere fast, it seems, based on the number of deals announced so far (zero). Intel Media, meanwhile, has offered nary a word about securing enough content for its service-in- the-making. It’s been a slow, but likely not impossible, slog for new OTT entrants.

Verizon declined to comment on speculation involving an OTT play. The good news for the company is that its pay TV business is still growing, so it has time to negotiate this. Cable operators are losing video subs, so they should at least be tempted by an OTT strategy, even if it means declaring war on other MSOs.

For now, no U.S. cable operator is entertaining this idea, at least publicly. Time Warner Cable president Rob Marcus was asked last Wednesday (Sept. 11) at the Bank of America Merrill Lynch conference if TWC’s programming contracts would allow it to offer services nationally, over-the-top. He said TWC remains focused on authenticated TV Everywhere apps for its existing base. “[A]t this point, we don’t really aspire to delivering an over-the-top service,” he said.

If deep-pocketed companies like Google and Intel Media find a way to lock in the rights necessary to deliver a virtual MSO service, cable operators will be forced to seek a matching weapon.

But will any of them have the guts to fire that first shot and start a war that would involve old friends?