Multichannel television is hitting the street.
Sling Media Inc. said Thursday that it would begin marketing software that will enable pay television customers to throw their cable- or satellite-television programming across wireless networks onto handheld devices and cellular telephones that use the “Windows” operating system.
Separately, consumer-electronics manufacturers are developing portable media players that are expected to pull down live signals beamed directly from satellites, akin to the compact screens in the back of JetBlue Airways Corp. airplane seats.
Samsung Electronics Co. Ltd., in fact, introduced a portable media player capable of receiving satellite-TV signals at the Consumer Electronics Show in Las Vegas in January. But the vendor’s claim that the unit, numbered “YM-P1,” would be able to pull down and show satellite-TV programming was withdrawn because technical standards in the United States are not settled, according to marketing manager Matt Durgin.
Nevertheless, surging interest in mobile, live television will likely require cable- and satellite-TV providers to respond to the products being developed by consumer-electronics makers, according to Aryeh Bourkoff, an analyst for UBS Warburg LLC.
“The main distributors in the pay TV industry, cable and satellite, are going to have to position themselves as aggregators of content and migrate more toward the consumer-electronics industry in order to obviously compete outside of the home,” he said.
DERAILING OPPORTUNITY
A case in point is Sling Media. With its mobile-software addition, its “Slingbox” technology allows customers to watch live TV on the go, but it doesn’t require Sling Media to cut deals with cable or satellite operators or their programming suppliers to access the video content. Instead, Slingbox acts as a relay, taking any video stream coming into the home TV set-top box and firing it off over the Internet to a computer or Windows-driven “PocketPC” device.
This has drawn the attention of Dish Network owner EchoStar Communications Corp., which invested in Sling Media last month as part of a $46.6 million round of funding that included Liberty Media Corp.
The slinging of live content to portable media players and cellular phones -- or the direct reception of it from satellites on handheld TV receivers -- could realign competition in the pay television business. Cable operators could find themselves at a distinct competitive disadvantage to companies such as DirecTV Inc. or Dish if they find a way to overcome technical obstacles and beam their programming directly to their customers at any time they are in transit or away from home.
But Forrester Research Inc. analyst Josh Bernoff sees no indication that EchoStar is moving toward live programming on a portable media device, perhaps because it could run afoul of geographic restrictions placed on local programming.
“It’s dangerous, because cable and satellite operators are part of the infrastructure that maintains the web of geographical exclusivity,” he added.
Meanwhile, the Samsung receiver and other receivers being developed by companies such as Royal Philips Electronics NV cannot be used in the United States to receive signals from DirecTV or Dish, yet. That is because DirecTV and Dish use a broadcasting scheme that is designed to send signals to stationary devices, not moving ones, according to Roberto Simmarano, a regional marketing manager in the United States for Dutch electronics giant Philips. .
Two broadband mobile-wireless-broadcast networks are in the works, however. Qualcomm Inc.-backed MediaFLO has struck a pack with Verizon Wireless to jointly build out its network, and mobile-video service could begin rolling out by the end of this year.
Meanwhile, Crown Castle International Corp. subsidiary Modeo LLC is working out the kinks of mobile-video service, as well. A trial network is up and running in Pittsburgh, and Modeo plans to start rolling out service in initial markets including New York by year's end.
Also by year’s end, the Samsung YM-P1 will be sold in Korea for satellite-TV reception there, Durgin said.
LOOMING LEGAL STATIC
But the evolution of television content into a mobile world will potentially produce legal static over programming and content rights. For example, it is not clear if programmers will object to the fact that Slingbox offers customers a way to watch TV content outside of the home, and if this is legal in the first place, according to Joe Laszlo, senior analyst at JupiterResearch.
“It’s an untested debate, because nobody has established the law on this -- about how far fair use goes,” Laszlo said. “Sling’s argument has always been that this isn’t content that people are stealing. It’s content that people are getting legitimately -- they are paying their cable bill.”
Mobile video, on the other hand, can benefit programmers.
“These are people who want to watch your programming. Would you rather that they don’t watch your programming?” asked Gigi Sohn, president and cofounder of Public Knowledge, a public-advocacy group. “If you’re a local affiliate, you can tell your advertisers, ‘Hey, my citizens with this device can watch you anytime, anywhere. You should pay me more money.’”
Nevertheless, chances are good that the question will end up as a court case to determine how television content can be extended in the mobile world.
Sling Media has been offering its products without challenge so far, but its addition of a mobile product “may force content providers to really make up their minds if they are going to let Slingbox grow its audience unmolested,” Laszlo added.
