The new TV strategy from Ziggo has just about all the ingredients you might expect these days, except for one: real interactivity. The company has chosen to communicate early, while most of the elements are not yet operational, and the real news is limited to new packages, more HD, an iPad app, a new remote control and the launch of pay-per-event, likely in March or May available. This raises several questions, such as how will Ziggo do this, who are its technology partners, is it planning a mobile network or a hybrid set-top box?
Watching TV is becoming a much richer and more personalised experience, through features such as:
◦ Web content (currently not part of Ziggo's plans as it requires a new set-top box): YouTube, websites from CNN, etc can be added, either via a browser (the same as on a computer) or via an app or widget (optimised for a TV) or as a digital channel (such as catch-up TV).
◦ Multiscreen (not yet available, as Ziggo has no mobile or Wi-Fi network): everyone can choose his favourite screen.
◦ ‘Second screen’ (the iPad, although Ziggo's app does not yet offer this functionality): ideal for sending personal messages over social networks without having to display them on the TV.
◦ Personalisation (via the iPad app): it's less and less about households and more and more about individuals.
◦ Interactivitity (no plans): so-called interactivity is used by TV providers to promote what is basically two-way: pausing live TV and on-demand viewing of films and shows. Choosing a camera angle during a sporting event goes more in the right direction, but it's pushing it to call this real interaction. Ziggo calls, just as other providers like Tele2 and KPN, pausing and on-demand its interactive services.
In short, Ziggo is on the right track and now needs to focus on the execution. It's interesting to note that all the announced projects are still in the planning phase. The only real innovation (if somewhat limited) is the iPad app. There is still absolutely no talk of a new hybrid set-top box or concrete mobile plans. The operator also underlines the quality of its network, and you can ask why it then needs to reduce the number of analogue channels. An analogue channel takes as much capacity as four or five digital channels, but apparently spectrum is also a scarce resource at Ziggo.
There's also the question of whether more fibre is needed, or if the company will choose for node splits instead. Questions here include:
◦ Is the fibre backhaul sufficient? If not, then upgrading is relatively simple.
◦ Are too many households sharing capacity (due to the growing popularity of streaming video)? If so, then a node split offers the first option and FTTH the ultimate solution.
◦ Also, is the network of fibre end-points dense enough to be used as a mobile backhaul network? If so, then this will make a big difference in the roll-out of a mobile network. If the fibre is deep enough in the network structure, then the end points can be used also as the basis for Wi-Fi access points. This could mean even dropping the whole need for a mobile network.
In the end one can also ask why Ziggo and the other cable operators don't coordinate their plans for the 'new TV viewing'. Liberty Global has been working since 2009 on Project Horizon, which has roughly the same goals as Ziggo's new plan. By working together, they could ensure a uniform nationwide service. This offers subscribers clarity, and the operators the chance to advertise and develop together, pushing down the costs.
Ziggo has chosen to unveil its plans at an early stage. On its own, it can manoeuvre clearly more quickly than if it had to take into account the interests and vision of UPC and other cable operators. There is also a defensive argument for Ziggo: the IPTV providers are not standing still and at the same time the real ‘over-the-top’ providers (such as Apple TV, Boxee, Google TV and also the Philips Net TV) are arranging ways to bypass the operators. TV operators are at risk from OTT providers reducing them to providers of basic services: standard TV (or also analogue TV, like Nederland 1 to 10) and broadband. While the switch from analogue to digital TV is for the subscriber an ideal churn moment, Ziggo needs to defend its status as 'incumbent' on the TV market against not only KPN and its wholesale customers but also Philips and Boxee. The OTT players are currently generating the most noise on the TV market, and Ziggo wants to show that it can also spark up the party.
