TELCO SECURITY, DRM MAY HELP CHANGE CONTENT MODEL

For pretty much most of the history of cable television, the model has remained the same. Subscribers pay a monthly services fee for dozens of channels, a few extra bucks for premium movie channels and maybe a few more for a pay-per-view movie or event. Telcos, though, with the ability to unicast and secure content to individual users—and in some cases to individual TV sets within the home—have the chance to change the entire model.

Driving much of the change is the potential to offer virtually everything on a per-view basis. And while major networks have traditionally balked at such arrangements, many in the telco video world believe new entrants may have a better negotiating position that cable and satellite operators. Because many carriers will have a migration path for securing content with digital rights management systems, studios should lose their reluctance to provide content on a per-usage basis, said Rajan Samtani, director of sales and marketing ContentGuard.

“Going to this usage-centric model as opposed to selling bundles where you don’t care what’s in there is going to happen sooner than you think,” he said. “The pressure is going to come from the consumer. The telcos also can offer more competitive revenue-sharing relationships. We’re in this very interesting phase of the shift.”

To some extent, wireless carriers are providing early looks at how security and DRM has changed the relationship between content providers and distributors like carriers. Numerous carriers have been signing up music and movie producers to not only re-purpose content for the mobile environment but also to created specific music and video for it.

“As long as you’re making money off the bundle, you’re not going to break it up,” Samtani said. “I think the key is to be able to find those kind of two-screen applications that can work.”

For telcos without a mobile offering, the two are the PC and TV. However, making the transition legally between the two is going to require additional assurance to creators. Giving a user, for example, the right to record shows on his PVR and then send it to a laptop could be a premium service, but not without ensuring that the transition between the two devices doesn’t open up a security hole.

“One problem is once the content is in how this content will float around the house,” said Thierry Fautier, marketing director for emerging markets at Harmonic. “Once you have the content on your set-top or your hard drive, what can you do with it? The telecom operator is thinking in terms of a home gateway. In that case, it has to be a connected device. The question is how do you disable other users in the home? This is where the game is right now.”