Sezmi Downshifts Retail Play

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Is the rest of the world Sezmi's oyster?

The Silicon Valley startup has
shifted focus to shopping its hybrid
broadcast-Internet TV system
to telecom operators overseas,
after finding it tough to woo consumers
in the U.S. with a service
billed as a cheaper alternative to
cable and satellite.

Last month, Mexico’s Grupo
Iusacell, a mobile and television-services
provider, picked Sezmi
as the unified platform for next-generation
TV services over wireless and
fiber-to-the-home networks. That came after
Sezmi struck a deal with YTL Communications,
a Malaysian utilities and telecommunications
firm, to provide a converged TV
and Internet-services system by the end of
2011, using DVB-T2 technology and a 4G
WiMax wireless network.

“In markets that have
relatively low wired
broadband infrastructure
and low pay TV
penetration, there’s the
opportunity to grow
a business instead of
churn a business,” Sezmi
co-founder and president
Phil Wiser said.

Sezmi last year
launched a $4.99-per-month
package in parts
of 36 U.S. markets. That
service delivers broadcast
TV, plus free and
fee-based video-on-demand and Web content,
to a digital video recorder set-top using
a combination of broadcast airwaves and
broadband Internet. The company had offered
a premium package with 23 cable networks
for $19.99 per month in Los Angeles,
but eliminated that option in December.

Wiser said Sezmi will maintain the current
retail offering in the U.S. market as it
looks for service-provider partners in the
States. “There are many types of providers
we’d work with, from telcos to over-the-top
providers and even mobile providers,”
he said.

For now, Sezmi is finding more interest in
countries where HD video, digital video recorders
and on-demand “don’t exist or barely
exist,” Wiser said, “whereas in the U.S., it’s
all about cord-cutting.”

Founded in 2006, Belmont, Calif.-based
Sezmi has raised more than $92 million in
funding from investors including Morgenthaler
Ventures, OmniCapital Group and
Index Ventures.