Despite Big Talk, Tru2way Could Suffer the Fate of CableCard
Last week, the FCC announced that less than half a million standalone CableCards have been shipped into deployment; no one was particularly surprised. By now, most know the FCC’s vision of millions of CableCard-enabled TVs, Media Center PCs and consumer electronics — which would enable consumers to get cable content on their computer or TV without a set-top box — is dead in the water.
And while no one’s really surprised, many are angry. Why? Because the cable industry’s half-efforts to push CableCard have largely doomed the technology, which many saw as a way to free themselves of the set-top box and still get great premium content.
But really, can you blame the cable companies? Every CableCard in a TV or Media Center PC means less money for the cable operator in Video on Demand and Pay-Per-View. If you’re a cable MSO, it’s kind of hard to get motivated to start spending marketing bucks on a project that would hit your bottom line.
So of course standalone CableCard has been a failure, but will Tru2way — the cable industry’s Java-based software platform for interactive TV applications on set-top and consumer electronics — suffer the same fate?
The two initiatives have different but related goals. CableCard was an FCC-mandated push to separate security from the cable set-top box, lessen the reliance on the cable set-top duopoly, while providing new opportunity for consumer electronics vendors. Tru2way on the other hand is cable’s own self-designed ticket to the interactive-services promised land that would, well, also lessen the reliance on the cable set-top duopoly, while providing new opportunity for consumer electronics vendors.
To hear many in the cable industry tell it, Tru2way is the foundation for the industry’s future. And after a giant coming-out party for Tru2way at CES 2008 — at which the cable industry held hands with consumer electronics makers and told us to get ready for the onslaught of great products from the likes of Panasonic, Samsung, LG and Thomson — you’d expect the rollout to be going gangbusters. Right?
Well, not quite. In fact, when nearly every MSO missed the cable industry’s self-imposed July 1 deadline to support Tru2way, many industry-watchers wondered what was going on. The cable industry’s response was essentially that, well, being a cable MSO is hard work. But what’s really happening?
At some point, cable MSOs realized that Tru2way and its underlying Java platform would require entirely new (and expensive) set-top boxes. If there’s one truism about cablecos, it’s they don’t like spending money on new consumer equipment when they can wring more out of stuff that’s already paid for.
So in order to do that, they settled in the medium term on EBIF (Enhanced TV Binary Interchange Format) instead, a technology which enables basic interactive services on the millions of existing set-tops already in the field. The only problem with this approach is that it means no Tru2way-enabled consumer electronics products at retail.
So, while interactive services within cable are certainly not dead, the market for Tru2way consumer electronics barely has a pulse, and Tru2way remains, at least for now, another unfilled promise from the cable company.
@Alfred and @Mari – both good points. I was remiss in not mentioning TV Everywhere. Opencable/Tru2way has been gestating for 10 years, meanwhile you have IP and OTT video and interactivity popping up everywhere we look around the TV, and its certainly not being led by the cable industry. I think tectonic shifts are afoot due to the Internet and rich media being delivered by it reaching the living room (Comcast/NBCU – this is one of the motivations for Comcast IMO).
I’ve gone back and forth on this question. Tru2way is certainly valuable to MSOs, but it rapidly loses value if the planned migration to IP takes place. I think it’s all going to be a matter of timing. Tru2way will move forward if the IP timeline is long, but it will presumably falter if the cablecos get aggressive on IP. That’s my guess.
Like Blu-ray, Tru2way is trying to solve a problem of the past. Many cable companies are realizing that the connection they want is Cat5, not coax, and use the Internet for distribution. The new “TV Anywhere” initiative launched by Time Warner but backed now by Verizon and Comcast is the real answer to providing viewers access to what they want, when they want, where they want. And given growing rate of Internet-connected HDTV sets, the cable companies don’t have to worry about more hardware or new STB designs. Ask Microsoft; the money has always been in the software (content/service), not the hardware.