By Anthony Smith-Chaigneau, Senior Director Product Marketing
With multiscreen viewing, subscription video-on-demand (SVOD) and over the top (OTT) services fundamentally changing the television watching experience, one of the big questions for pay-TV operators is whether the set-top box (STB) needs to evolve to adapt to this new reality. To date, there are no definitive solutions, but there are definitely options.
One answer is going with more flexible software platforms such as browser-based HTML5 apps. These apps enable operators to move toward a “constant evolution” model in which they can update their STBs on a daily basis and deliver new service features more quickly. However, with increased speed comes a reduction in reliability. Just as mobile apps are frequently affected by bugs, pay-TV operators adopting an app-based approach are at risk from some of the same reliability issues.
The emergence of STB software-as-a-service has also led certain pay-TV providers to outsource their STB software. These operators pay to license STB software rather than own it. Although it helps to lower subscriber acquisition costs, there are downsides like lack of ownership. This means operators may not be able to address specific development issues as quickly as they would like. Also, by maintaining only a skeleton software development team, operators may not save enormous amounts as they will still need to pay large license fees to the companies providing the software. Moreover, operators must accept appearing on customer devices alongside competitor services.
Still, for some operators, following customers onto connected devices is more important than retaining control over how they watch TV, even if it means an increased risk of churn. The willingness of some operators to outsource the development and maintenance of STB software points to a growing adoption of the software-as-a-service model. And with capable platforms such as NAGRA’s intuiTV, operators now have the opportunity to license the necessary STB software to run a modern pay-TV business.
Ultimately, it’s a weighing game for providers. Go with a top-end platform like NAGRA’s intuiTV to have a worry-free path. Or maintain software ownership, which provides control over development and maintenance of the set-top box and leave open the ability to internally create new hardware/software combinations, differentiate their service, and retain control of input one on the television set.
Either way, for the majority of consumers today, TV remains the dominant way they enjoy content. This means that, for operators, whichever direction they choose, providing an excellent experience remains an essential part of the business.
For more information, visit NAGRA’s document center and download the white paper Owning Input 1: The Future of the Pay-TV Set-top Box and Software