Cable Group: Consumers Saved $2 Billion in Electricity Costs Moving Away From Standalone DVR

Consumers saved nearly $2 billion in electricity costs in 2019 as a result of the voluntary set-top box energy efficiency agreement among pay-TV operators, according to NCTA — the Internet & Television Association trade group.

Working together with the Natural Resources Defense Council and the American Council for an Energy-Efficient Economy (ACEEE), pay-TV operators created more energy-efficient devices, including moving away from traditional DVRs, which help lower monthly electricity bills for consumers and contributed to less CO2 emissions into the environment.

A new report by independent auditor D+R International found that under the seven years of this agreement, national set-top box energy consumption decreased by nearly half (46%), yielding cumulative savings of more than $7 billion in electricity costs and avoiding nearly 39 million metric tons of CO2 emissions.

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The energy saved during this period is equivalent to the electricity used by all homes in the state of California for more than seven months, and the ongoing annual reduction in electricity demand is nearly equivalent to the power generated by five typical 500 megawatt coal-run power plants.

“By going above and beyond their voluntary commitments, pay-TV providers nearly doubled the $1 billion annual savings projected when the industry established its successful partnership with NRDC and ACEEE in 2013,” Neal Goldberg, General Counsel of the NCTA, said in a statement.

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Doug Johnson, VP of technology policy with the Consumer Technology Association, said the video entertainment market has changed over the past decade as consumers increasingly watch video on connected devices beyond the TV and from Internet-delivered sources.

“The [collaboration] has enabled industry and energy efficiency advocates to stay ahead of these fast-paced changes and secure far more energy savings more quickly than could have resulted from traditional regulation,” Johnson said.

D+R’s report, which is based upon multiple levels of independent verification tests and audits, found that the average power usage of a new digital video recorder (DVR) has decreased by 50% since 2012 as a result of whole-home architectures and cloud-based content storage.

Consumers used more than 43 million customer-owned devices such as Smart TVs, smartphones, tablets, personal computers, and streaming devices such as Apple TV, Roku, Google Chromecast and Amazon Fire to access the signatories’ video services via apps in 2019, which reduces demand for pay-TV set-top boxes.

D+R compiled these findings by reviewing data on every 2019 new set-top box purchase by all of the major pay-TV providers serving 94 percent of the U.S. market, including AT&T/DirecTV, Comcast, Charter, Dish Network, Verizon, Altice, Cox Communications, and Frontier.

Parks: Consumers Spend Seven Hours Weekly Streaming Online Video

It’s an over-the-top video world. Parks Associates July 1 said new data showed the number of hours per week consumers spend watching online video has almost doubled from 3.6 hours per week in 2017 to nearly seven hours per week in 2020. Dallas-based Parks said at the same time traditional pay-TV service has declined from an adoption rate of 75% to 62% in U.S. broadband households between Q1 2017 and Q1 2020, which led a subsequent decline in set-top box adoption.

“Consumer surveys find that 74% of U.S. broadband households subscribe to at least one streaming service, and almost half of domestic broadband households subscribe to two or more services,” contributing analyst Dr. Kenneth Wacks said in a statement.

Wacks said the top three domestic OTT subscription services remain Netflix, Amazon Prime Video, and Hulu. Newcomers Disney+ and Apple TV+ have grown quickly to round out the top five. Additional services of note include CBS All Access, Crackle, Fubo TV, BHO Not, Philo, Pluto TV, and Sling TV.

Parks said the OTT services allow households to access premium video content without a set-top box, forcing a change in the relationship between set-top box makers and cable/satellite operators. Content developers and networks are now streaming content directly to consumers or distributing through OTT service providers. In some cases, multiple-system operators (MSOs) are launching their own streaming devices or creating offerings similar to vMVPDs (virtual multichannel video programming distributors) with the goal of recapturing pay-TV cord-cutters or cord-nevers.

Parks contends the pay-TV set-top can remain viable if able to aggregate the variety of different streaming services coming into the households and present them in a personalized and attractive UI with voice and smart home controls for an improved consumer experience.

“The set-top box does have a role in this market, but it will have to adapt,” Wacks said.

TiVo Splitting into Two Companies

Time-shifting video pioneer TiVo is separating its product and IP licensing businesses into two separate companies.

TiVo’s said its board concluded the separating would be the best strategy to maximize shareholder value. The company intends to spin out its DVR-based hardware business to shareholders. Throughout the separation process, the board would seek “strategic” transactions for each business that could create additional stockholder value.

“Operating independently, these two businesses will have increased flexibility to pursue new and growing market opportunities,” Raghu Rau, Interim CEO, said in a statement.  We believe this separation is the best way to maximize shareholder value, while also enhancing the possibility of value-creating strategic transactions.”

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TiVo expect to complete this transaction in the first half of 2020 through a spinoff of the product business to shareholders.

The product business offers software technologies video service providers or retail markets. At the end of 2018, there were an estimated 23 million households worldwide utilizing our TiVo software. The product segment generated $401 million in revenue, with a large component of recurring revenue.

TiVo believes the separation would “open” its product business up to greater receptivity from service providers, content providers and device manufacturers, as well as potential customers in new markets.

The unit is planning several new product and business model launches later this year, including creating a new content network with increased monetizable opportunities through advertising.

TiVo’s branded IP portfolios (including Rovi) encompass about 5,500 patents and pending applications worldwide. Licensees include traditional and new media video providers across pay-TV, over-the-top video, mobile, CE and social media markets. Licensing revenue reached $295 million in 2018, with a high percentage of this recurring revenue.

“As video consumption continues to shift beyond traditional pay-TV into Internet, social media and mobile domains, we believe it is important that the licensing business can diversify … into new consumer applications and functionalities,” Rau said. The separation will enable the IP business to strategically reinvest in its own business, not only to solidify its strong, existing foundation, but also to appropriately pursue new long-term growth opportunities.”

IHS: 22% of Web Users Employ Voice-Commands to Control TV and Video Devices

Voice-activated consumer electronics in the home is growing in popularity.

New data from IHS Markit found that 22% of Internet users across four markets – the United States, United Kingdom, Australia and India – use voice-command software to operate their TV and video devices, including smart TVs and set-top boxes. Another 30% are interested in doing so in the future.

Next to content recommendations, content discovery and navigation is vital for video services as 20% of video cancellations are due to a perceived lack of available content, according to IHS.

The most common reasons for cancelling video servicesfrom an online survey of 9,636 Internet users in Australia, India, the U.K. and the U.S. conducted in November 2018, included cost, lack of use and lack of available content.

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Indeed, IHS found that the burgeoning amount of content available across media devices puts the user experience at the forefront of device and platform strategies, including discovery, recommendations and navigation.

Voice command functionality represents an increasingly important element in content discovery, as it allows users to not only search for content, but also control the video interface in some instances. Consumers already using voice commands on video are more likely to own connected living room devices, which indicates they may already have access to large content libraries across various services and devices.

 

London-based IHS found respondents using voice commands to operate video devices are more likely to own, or at least have access to, connected devices that allow access to over-the-top (OTT) video. These devices include smart TVs, games consoles and media streaming sticks.

Voice-command use peaks among 25-to-34 year olds, compared to all adults aged 18 to 64. Older age groups continue to use traditional methods of content discovery, and many are not engaging with all the features and content available to them

Content catalogs are a key reason consumers subscribe and engage with video services, so ensuring the right content makes it to consumer TV screens is increasingly important,” analyst Fateha Begum wrote in her report.“Easing navigation and improving personalization are critical ways to increase value to video consumers, so large content catalogs don’t become burdensome to the user experience.”

Begum said voice functionality is a key element for device manufacturers – particularly within home entertainment. The ability for devices to communicate and control other devices has become evident, as brands are increasingly launching proprietary digital assistants, according to the report.

“For TV providers, innovating in the areas of content discovery and recommendations is a means to ensure their content is easy to find, driving greater value and  ultimately reducing customer churn,” Begum wrote. “Pay-TV operators have an advantage over most OTT streaming services, because they can manage the user experience on the set-top box and can ensure their own content is prioritized on the platform.”

 

 

Cisco’s Former Video Software Biz Renamed ‘Synamedia’

A new video technology company named Synamedia has been formed from the recent sale of Cisco Systems’ Service Provider Video Software Solutions unit to investment firm Permira Funds.

“Syna” means “together” in Greek, reflecting Synamedia’s goal to empower broadcast, pay-TV and over-the-top video services to optimize their current infrastructure and capitalize on OTT distribution to expand consumer choice and convenience, secure revenue streams, and develop new offerings.

“From day one we will be the vendor with the ability to deliver products on a global scale while also offering the flexibility required for market localization,” Yves Padrines, incoming CEO for Synamedia, said in a statement.

Padrines is currently VP of Global Service Provider for Europe, Middle East and Africa at Cisco.

Synamedia will offer software for hybrid broadcast/IP services on multiple devices, including set-top boxes devices. Features will include an anti-piracy service for rapid detection of, and response to, illegal streaming. Other new offerings include “VideoGuard Everywhere” and “VideoGuard Server” support for Android devices.

“We will intensify our focus on innovation, building even closer links with our customers and ensuring that we continue to provide the world’s most complete, secure and advanced end-to-end video delivery solution,” Padrines said.

The company is also offering software it claims can reduce streaming latency on a STB down to six seconds – comparable to a live broadcast. This would be lower than traditional streaming technologies, where latency can be as high as 40 to 90 seconds for streaming video to receiving devices.

“Synamedia enters the market at a time when the TV landscape is being redrawn. Building on a 30-year heritage in the pay-TV industry, a market leadership position, and an unrivalled reputation for innovation, we will hit the ground running as a private, independent entity committed to help customers boost engagement and revenues by capitalizing on the myriad opportunities that IP distribution and cloud- based services bring,” said Dr. Abe Peled, incoming chairman of Synamedia.