Surprise: Cable viewers really like YouTube on their set-tops

Looks as if cable subscribers really like online video, especially if they can access it on their existing boxes: UPC Hungary’s experiment to add YouTube to its set-top boxes has been a big success, according to a new case study by cloud virtualization provider ActiveVideo, whose technology is bringing the video service to Hungary’s TV viewers.

UPC started to make YouTube available to 200,000 of its 910,000 video subscribers last summer, and brought it to another 320,000 subscribers in the following months. Sixty-eight percent of those subscribers have since tried the YouTube app on their set-top box, and 83 percent of those who tried it have turned into repeat users. All together, these subscribers view more than 1 million minutes of YouTube content a day, with sessions averaging 45 minutes.

What’s impressive about these numbers is that UPC isn’t actually using any kind of special next-generation set-top box hardware. Instead, it is transcoding YouTube in the cloud, and presenting everything from the clips to the app menus as a single video stream that can be displayed by any plain old set-top box. And yes, you can take “plain” and “old” very literally, in this case: Most of the 320,000 boxes that were added to the mix in recent months are standard definition only.

ActiveVideo’s technology even makes use of existing remote controls by translating each key press to a command that is sent to the cloud to instantly change the stream for a subscriber, making it look as if he is browsing an app installed on the set-top box itself. This kind of cloud virtualization technology is similar to OnLive’s cloud gaming technology or the way Android Auto uses in-dash displays as extensions of your handset.

UPC Hungary, which is part of the Liberty Global family, isn’t the only TV provider experimenting with online video services on pay TV boxes. Netflix struck a partnership with Dish late last year to bring its app to Dish’s Hopper DVR, and is looking to sign similar deals with other TV operators in the U.S. and beyond. And Comcast has been looking to launch its own online video service on its X1 set-top boxes.