The Three Things That Nearly Always Hamstring New Tech Vendors in Cable
by Leslie Ellis // October 01 2007
It used to be that three blockers predictably conspired to gum up innovation and slow down new product introductions on the video side of the cable house.
One was the billing system. The bindweed of the back office, its tendency was to wind its way into all other mission-critical realities, like new service activation, customer care, even dispatch.
Two was “the guide.” Like a gas, it seeped into all available space within those early, already-constrained digital boxes. Plus it seemed to want to grow up to be the foundational platform for anything that showed up on the screen. It wanted to be the guide and the middleware.
Three was the conditional access and encryption system. Because the supply side for keeping content safe was split down the middle — between Motorola and Scientific-Atlanta — making changes meant constantly nudging two companies with mutually exclusive technologies.
The three blockers had three things in common: Making changes took too long, cost too much, and yielded less control than operators wanted.
That’s when the game changed. Maybe the time had come to take over for real, various operators said. Maybe it’s time to build our own (fill in the blank).
Fast forward to now: Billing still tilts toward “buy” in build v. buy. It’s painful enough just to modify the billing system. Changing it out? You might as well remove your own veins.
The guide and the conditional access mechanisms, however, did tip toward “build.”
Two things happened to the guide. One was the OpenCable Application Platform — what we used to call “OCAP.” It solved how the guide wasn’t to be the middleware. Plus, OCAP solved another problem: How to give cable services a national footprint.
The guide also became a “build” item for some operators — notably Comcast and Time Warner Cable. Both made substantial investments in the “build your own” alternative, either by absorbing guide-oriented companies outright (Comcast), or by assembling brainpower in-house (Time Warner).
From the outside looking in, it’s difficult to quantify whether these “build” moves made costs drop and innovation accelerate. Here’s one way to look at it: Inventions like “Start Over,” “Look Back,” subscription VOD, and the ability to do a self-upgrade from the TV screen are all reasonably new. They came, in part, from the “build your own” guide camp.
A couple of things happened on the conditional access side, too. The biggest chapter, since the “good old days” of embedded security, was the CableCard. It achieved the goal of a national cable footprint, for those consumers who purchase a TV set with a CableCard slot, take it home, and decide to get a scrambled service.
Somewhere in all of that, an effort called “downloadable conditional access” (“DCAS”) was born, in the form of an operator-owned company, PolyCipher. PolyCipher is based in Denver, but incorporated in Delaware, as part of “NGNA” — the “Next Generation Network Architecture” joint venture between Comcast, Time Warner, and Cox.
To put this in perspective, NGNA is known within technical circles as a place where strategic necessities are turned into a plan for products. The channel bonding aspects of DOCSIS 3.0, for instance, were born within NGNA. So was the notion of modular headend gear for broadband data. Ditto for the set-top line Comcast calls “RNG” — initially short for “Real Next Generation,” then changed to “Residential Network Gateway,” depending on whose version of the story you hear.
The difference this time is that the “build” was done as a separate company — understandable, given that this is crypto stuff. But still, it doesn’t take that much of a logic leap to wonder if the work of PolyCipher fits into the “get it done, move on” model of the prior NGNA efforts.
In other words, design the DCAS chip, find someone to make it, participate in the tape-out (initial layout) get it into production — then retreat. Move on to the next strategic priority.
What’s better, build v. buy? It’s a controversial philosophy question that varies, depending on what’s being built or bought. At the very least, though, it probably means that those operators entrenched in the “build your own (fill in the blank)” are a bit more empathetic to the timing and cost issues once shouldered solely by their suppliers.
This column originally ran in the Technology Section of Multichannel News.