Creative License

A growing number of outsourcers known as content aggregators are approaching telcos, and others, with packages of video content and related services so service providers don’t have to negotiate their own time-intensive licensing deals with studios and other programmers in a one-off fashion.

Many content aggregators are targeted primarily at the rural telcos, which might not have the resources to handle multiple negotiations with the big TV and movie studios. But some content aggregators are offering up barrels of specialized content, which is the stuff expected to give telco TV providers — with their capacious IPTV networks — an edge in the video marketplace.

As an example of the latter, Akimbo Systems is appealing to video service purveyors of all types with its library of more than 10,000 television programs and movies-on-demand. AT&T Inc. this spring tapped Akimbo to provide its Internet-based VoD service to subscribers of AT&T’s hybrid DSL/DBS Homezone TV service, scheduled to launch later this summer. Akimbo in June closed a Series C investment round of $15.5 million, which included new investors AT&T and Cisco Systems Inc.

Akimbo, which got its start offering specialized content via its own set-top box but now is looking to distribute via broadband service provider partners, offers videos and movies from more than 165 content partners throughout the world. Each week, Akimbo adds more than 150 new mainstream and niche titles in 85 different categories, such as music, sports, independent film, anime, major motion pictures, education, children’s programming and foreign language.

For “cable and telco providers who are looking to supplement their video offering with massive on-demand content, Akimbo is really the only game in town to aggregate from hundreds and hundreds of providers in one place and bring that content on to their platform,” Akimbo CEO Josh Goldman told xchange in an interview earlier this year.

While Akimbo is dedicated primarily to the aggregation and delivery of specialized content, most content aggregators focus mainly on doing licensing deals with more mainstream studios and providing that content — and related services — to telcos.

One example on this front is the ViewNow subsidiary of video infrastructure provider Kasenna Inc. ViewNow CEO Steve Roberts says while his company has “a full array of niche programming” including foreign language and children’s movies and shows, the company also has deals in place with DreamWorks, NBC Universal, New Line Cinema, Paramount Pictures, Twentieth Century Fox, Warner Bros. and several independent studios to offer IPTV-based, on-demand versions of their programming. “We’re the only company that has IPTV rights for all the studios — that’s a major distinction,” he says.

Roberts adds that ViewNow earlier this summer announced an agreement with Buena Vista Pay Television to offer Disney studio content to both the telco and cable television markets. The licensing rights that ViewNow has acquired allow consumers ordering Disney VoD titles a 72-hour viewing period, which Roberts notes puts VoD more on par with video stores like Blockbuster. And, of course, that includes some amazingly popular titles — such as “Pirates of Caribbean 2: Dead Man’s Chest,” “Cars,” “The Chronicles of Narnia: The Lion, The Witch and The Wardrobe,” “Eight Below,” and “Chicken Little” — from such studios as Miramax Films, Pixar Animation Studios, Touchstone Pictures and Walt Disney Pictures.

Robert says only three or four companies are able to offer Disney titles via VoD, so this is an enormous deal for ViewNow, considering “Disney represents 15 to 20 percent of the market in the theatrical world.”

Beyond obtaining licenses from content providers and copyright owners, Roberts explains that ViewNow also encodes that content in MPEG-2, MPEG-4 (H.264) and VC-1; offers an array of marketing materials that service providers can access through its secure Web site; and provides a tool called ViewTrak, which delivers a real-time management report on what users are viewing which content, based on zip code, and handles all on-demand content accounting for ViewNow affiliates.

ViewNow, which Kasenna purchased about two years ago, now serves more than 25 affiliates in North America and expects that number to nearly double by the end of 2006. In fact, Roberts says all the telcos offering TV services, with the exception of Verizon which in February of 2005 announced a deal with on-demand content aggregator TVN Entertainment Corp. for its FiOS TV service, use ViewNow.

ViewNow customers include Tier 1, 2 and 3 service providers. At GLOBALCOMM, the company announced it had sold its major studio content to seven new affiliates, which are Arkwest in Arkansas, Comspan Bandon in Oregon, the City of Burlington in Vermont, KPU Telecommunications in Alaska, Pineland Telephone in Georgia, Valley Telecom in Arizona, and Wood County Telephone in Wisconsin. ViewNow is also the content supplier to CLEC Cavalier Telephone, to which it was just starting to ship H.264 programming in late June. ViewNow expects to be in full distribution with its H.264 content this summer.

As for pricing, affiliates pay for the programming based on consumer purchases, and ViewNow gets a percentage. There is no upfront cost. Beyond that, Roberts declined to discuss pricing for the content.

Of course, many of the rural telcos that ViewNow and Kasenna — as well as the other content aggregators — target initially relied on National Cable Television Cooperative Inc. (NCTC) to get their programming. However, as xchange previously has reported, NCTC a few months ago “capped” its membership, presumably to keep out new telco entrants, which compete with NCTC’s core members — rural cablecos.

As a result, the National Rural Telecommunications Cooperative (NRTC) got together with SES Americom and the National Telecommunications Cooperative Association (NTCA) to create a competing programming/video headend service.

Texas telco Valley Telephone Cooperative Inc. (VTCI) is testing that service, called IP-PRIME. The advanced MPEG-4 satellite video transport service from the trio will enable rural telcos like VTCI to receive and distribute hundreds of video channels in their service areas over DSL, fiber optic and hybrid facilities at greatly reduced capital costs. “Through the use of MPEG-4, the amount of bandwidth used by a video signal is about one-half of that needed for delivery using the existing standard of MPEG-2”, says Mike Carney, NRTC’s national sales director for IPTV. “MPEG-4, combined with the delivery of a high-performance IP network, allows telcos like VTCI to use DSL for the delivery of high-definition television and additional channels simultaneously to the home.”

Meanwhile, a company called CSI Digital is readying to launch a 200-channel, linear video content aggregation solution in September under its Trident brand, according to CEO David Luman and CTO Lu Bolden. The company already offers white-label wholesale VoIP services through its Trident initiative. Additionally, CSI Digital has OSP construction and materials divisions related to fiber builds. As with the above-mentioned solution providers, customers can choose to purchase the content and/or infrastructure offerings as a whole or in piece parts.

For the video offer, CSI Digital has partners with Intelsat to offer a superheadend on the East Coast through which service providers can access video from the programmers.

“The launch of Trident will now enable service providers of all kinds to acquire price-advantaged wholesale digital content for delivery to their customers,” says Luman. “ISPs, MSOs, telcos and other providers have traditionally had to spend millions of dollars just to receive and distribute digital video content, let alone a market full complement of services. With Trident’s complete solution, providers can increase revenues in current markets or enter new territories quickly and inexpensively.”

CSI Digital's Video Package

• Delivery of 200 video and music channels
• MPEG-4 AVC and MPEG-2 encoding
• Transport and affiliate rights acquisition
• Headend and access network engineering and integration
• Middleware and conditional access systems integration
• Operational Support
• Equipment acquisition assistance
• Dramatically reduced deployment cost