Times are Changing: Intel Building an IPTV Service + Box
by Anand Lal Shimpi on February 12, 2013 2:30 PM ESTThe most interesting things at CES were the things that weren't at CES. While I'll discuss the others in due time, one notable absence from CES was the often rumored Intel set-top box. Erik Huggers, the head of Intel's new Media division, confirmed today that Intel was working on a complete IPTV solution: service, software and hardware, all to be sold direct to consumers.
Erik confirmed that Intel Media was an all new group within Intel, staffed with folks from Apple, Netflix and Google among other places. Erik himself came from the BBC's Future Media & Technology group. Intel seems to know that it can't pull something like this off using internal talent alone. Bring in smart outsiders then give them the support of Intel seems to be the approach here - and it makes sense.
Details are scarce, and I'd expect them to be for quite some time. Intel committed to launch the box and service this year and it'll support features like catch-up, video on demand as well as live TV - all delivered over the internet. A list of content providers as well as pricing are two notable bits of information that were missing from today's disclosure. Until we get closer to launch, I wouldn't expect to hear anything on either front. Intel did mention that this wasn't a value play, and there was a strong focus on content bundles, which means this is likely not a full á la carte solution that's going to drive cable TV providers out of business.
I'll refrain from speculating publicly here, but there's a lot that makes this interesting. Some questions to ask:
1) Why is Intel getting into the TV business? Why now?
2) If not competing aggressively on pricing, then how will Intel differentiate?
3) Intel's divisions traditionally require high operating margins to survive in the long run.
Unlike Intel's smartphone aspirations, its work in the TV space won't have the time to eventually build up steam. Intel also won't have the burden of playing catch up in a quickly maturing industry. The established players in the cable TV space have done a great job of stifling innovation for quite a while. It's clear that a more revolutionary approach is necessary to liberate live TV content. The question is whether or not Intel can be the first company to succeed where others have failed.
Many expected Apple to be the first to tackle and succeed here. Perhaps Intel will beat them to the punch? (this helps answer question #1 above).
More thoughts on this later.
Source: AllThingsD
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titanmiller - Tuesday, February 12, 2013 - link
Give me FULL á la carte and I will buy it. I'd be quite happy to pay $5/month for the channels that I would actually watch. I hate spending $100/month to get the 2-3 extra channels that I actually watch over the basic plans.This Guy - Wednesday, February 13, 2013 - link
This product could improve fab utilisation and increase time between retooling.Intel has more than enough brains and IP to decrease hardware codec time significantly. Quick sync is tiny and locked to the GPU clock. Intel could focus solely on high speed, high compression hardware decoders, add them to an atom and produce a highly secure system at a vary low price. As they wish to provide the complete ecosystem their profit margin could be significantly higher than their other markets.
HisDivineOrder - Wednesday, February 13, 2013 - link
...how can we as long as Cable owns the pipe no matter what? If they aren't charging us for the cable TV, they'll up the price of the cable internet to the point where we'll be effectively paying them the same except without as much work on their side.Plus, they wield the power to kill anything not coming from them directly at the drop of a hat. Many already give you arbitrary limits on how much you can download in a given month, but exclude any of their services (even Internet-based ones) from such limits.
I wish Intel could IPTV work out, I really do. But our government has set up a horrible scenario in giving ISP's exclusive rights to each area instead of fostering them to compete and scrap and claw one another down to give the consumer good value and an option to leave when we want.
Right now, for great online, most people have one option: cable. Sure, they can go DSL, but for most that's a significant downgrade and often unavailable in their area. Or they can go wireless and suffer lag and slow speeds. Or they can go satellite and suffer horror.
This would be great in a world where ISP's were highly competitive and always facing scrappy upstarts that might eat their lunch, but we live in a society where the only option for some to get reasonable speeds at low cost is to build up a municipal-based ISP that is then outlawed by that state's senate with a bill written by the cable company who owns that region and made law by that cable company's cronies.
Conficio - Wednesday, February 13, 2013 - link
I don't get it. why is Intel entering this business, where they are at the mercy of the competition (at least in the US).The really compelling approach in the US would be to become an ISP to break the speed and last mile monopoly. Intel would be a company that I'd trust to be able to raise the funds to build a great fiber to the premise network and most importantly to keep investing into it for the long haul.
But I might look at this too much from the US perspective.
The other point I don't get is the broadcast thinking in TV. It seems to me that the future will only be partially in one to many video, but a lot in one to one and one to few video. (both bi-directional) Think Skype video for family and business, think teacher and class communications, think business conferences. But again w/o controlling the routers and network you are at the mercy of the ISPs, because of the Bufferbloat issue. http://gettys.wordpress.com/bufferbloat-faq/
EarthsDM - Wednesday, February 13, 2013 - link
Anand, I realized when reading "unlike Intel's smartphone aspirations..." that if Intel enables this service on IA phones, tablets, laptops, desktops, and HTPCs *that* could be the competitive advantage.