Terrestrial Broadcast Courts the Cable Guy

Each month, Ross Rubin writes for Tech.pinions on the development and evolution of technology industry standards.

It is an act of short-term pessimism and long-term optimism to kill a fledgling technology and replace it with something that has a higher barrier to adoption. But that’s what happened with digital terrestrial broadcast in the U.S. With coverage barely rolling out, News Corp. and NBC banded together to form Mobile Content Ventures, which would restrict reception of digital broadcast to those who had registered via the Internet. The few products on the market that could receive the few channels become paperweights.

It seemed to be the last thing that the technology needed in light of its competition against IP. There have been a number of companies over the years that have tried and failed to deliver digital OTA broadcasting or datacasting. These have included ones that didn’t get far off the ground (such as Geocast), ones that sputtered along the ground (MovieBeam and Sezmi) and ones that crashed hard into the ground (MediaFLO). The latter best approximated the use case for Dyle and, like the emergent mobile broadcasting, required special support in smartphones in order to work. (Even HD radio, rather than being built into handsets, has largley been enveloped by radio apps such as TuneIn. Like satellite radio, it stands ready to bear the brunt of in-vehicle competition as 4G proliferates.)

However, what’s bad for the carrier can be good for the consumer. Like Netflix and Hulu Plus, MediaFLO required a subscription. Dyle, on the other hand, is free, and doesn’t consume any data from your cellular plan. Also, since the launch of MediaFLO back in 2007, smartphones have increased their penetration many times over and the iPad has ushered in a major new platform for portable video consumption.

One doesn’t have to host a daytime court show to pass judgement on the limited appeal of over-the-air fare. But live access to cable channels anywhere without a cellular plan for no incremental fee could be compelling enough to warrant the inclusion of tuners and antennas in a range of devices.

The good news for mobile broadcasters supporting Dyle is that the utility of these devices, unlike the original “Watchman,” have made them far more popular than handheld TVs ever were, but today’s mobile video devices are convergence battlegrounds where all media duke it out for consumers’ attention. Even among video, a host of potential options stand toc compete for viewers. These include not only long-form oriented Netflix, Hulu Plus and Amazon Prime, but increasingly, pay TV providers and broadcasters launching their own live streams for free. This is mobile digital TVs first major challenge.

The second is whether broadcasters can convince handset makers and carriers to build tuners into devices. These not only add cost, but require extra room for old-school antennae. Samsung, the world’s highest-volume smartphone-maker and a top vendor in the U.S., has long been a backer of digital terrestrial broadcast. It offers the Galaxy S Lightray on MetroPCS. However, carriers have little incentive to promote Dyle. Not only does it avoid tapping into consumers’ data plans, it substitutes for data-consuming services that might incentivize consumers to purchase bigger buckets of gigabytes per month.

What would be offered? Given the heavy competition of on-demand programming and the strength of digital terrestrial broadcasts, there would likely be an emphasis on live programming such as news, weather and sports. We’ve seen the results of some of this multicasting with fixed over-the-air digital television, where broadcasters have put on programming such as news and weather channels alongside their main local feed.

There are two rabbits that Dyle’s backers hope to pull out of its hat. First, since Dyle broadcasters know where the consumer is, they can insert commercials that are more contextually relevant. But the more interesting play is that, while the service today delivers only the same broadcasts one would see watching at home, it has the potential to include pay TV channels offered by those broadcasts. So, for example, an NBC affiliate could potentially offer Bravo while an ABC affiliate could potentially offer ESPN.

Such premium channels would likely be cable-authenticated. And as such, their broadcast transmission would be added on to the retransmission fees that cable companies pay; the twist is that it broadcasters would collect additional fees for carriage on spectrum that they own rather than on pipes owned by multiple video programming distributors (MVPDs) such as cable companies, DBS satellite companies and fiber-spinning telcos .

Yes, broadcasters — which expanded their portfolio of offerings with the bandwidth of MVPDs — now hold the keys to help those companies spread “cable” TV channels wirelessly. Of course, bandwidth would be constrained; one wouldn’t be able to receive the full breadth of a modern digital cable lineup via Dyle. But it’s clear that Dyle’s backers are thinking big; over time, as compression standards improve, more channels could be offered.

Of course, making that more palatable will require having Dyle on a wide range of devices. While unpalatable to carriers on smartphones, the tablet may represent the best vehicle (at least outside the vehicle) for Dyle to catch on. Belkin, for one, has released a small adapter powered by a coin battery that connects to previous-generation iPhones and iPads that use the 30-pin connector. Elgato has created a Mac-compatible dongle using USB. And a company called Tvizen offers a Wi-Fi hotspot that redistributes mobile DTV using other standards to a number of connected devices without having to be directly connected to them. It had shown off prototypes of a version for the U.S. market at CES a few years back. And the idea that consumers will return to the idea of extending a retractable antenna seems like a quaint one, at best. But if Dyle can fulfill its potential to move beyond simulcast to leverage popular cable channels such as ESPN and Bravo, it could at least provide an option for those who don’t want to tempt fate on their allocated data plan.

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Ross Rubin

Ross Rubin is principal analyst at Reticle Research, where he analyzes the adoption of consumer technology, and also publishes commentary at his blog Techspressive. You can follow him on Twitter at @rossrubin.

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