OpenTV Ready For U.S. Interactive Test

By | August 30, 2004 | Feature

With News Corp’s [NWS] entrance into the U.S. pay-TV market through DirecTV, competition in the interactive arena is likely to heat up. One of the likely beneficiaries of the move toward interactivity is OpenTV [OPTV], the pay-TV solutions provider, based in San Francisco, Calif. Jim Chiddix, OpenTV’s new CEO, told Satellite News that he expects to see more interactivity in the United States.

“I can’t believe that lessons learned elsewhere won’t be applied in this competitive market, which is really a three-way battle,” Chiddix said. “In addition, EchoStar [DISH] is beginning to add a lot more interactivity to its offer. EchoStar uses our core middleware and launched a very interesting mosaic screen application for the Olympics on NBC, where the customer can choose between different events. It is a familiar application to subscribers of FOXTEL and BSkyB [BSY], but it is the first time it has been done in the U.S. [market].”

Chiddix, who took over from James Ackerman earlier this year, believes the U.S. market could offer rich pickings for the company. With DirecTV and EchoStar moving to a more interactive future, Chiddix expects cable players to respond. In turn, some lucrative opportunities could emerge for OpenTV.

“With fierce competition in the marketplace, we think cable operators will be more aggressive toward interactivity. The missing element in North American cable has been a good software platform to underlay interactivity,” he said. “Cable operators are doing different things. Some applications are being launched directly on the boxes. That has been problematic; it makes for very slow integration and testing. It adds risk that entire cities can crash and brings down all the digital boxes. There have been stories like that. If cable is to move to interactivity, it needs to embrace a solid software platform.”

Cable Opportunity

According to Chiddix, cable in North America represents the biggest opportunity for the company going forward. “North American cable has the biggest single collection of digital boxes without a true middleware solution today so, in that sense, it is a big opportunity,” he said. “How that will unfold, and whether cable will follow a path that is purely standards-based or whether big cable companies will use different platforms and what role companies such as OpenTV will play is unclear.”

Chiddix expects News Corp’s presence in the U.S. pay-TV market will lead to more innovation. He commented, “I expect them [News Corp] to be very aggressive and innovative. Things have been very quiet at DirecTV, but I suspect, in due course, there will be a very visible re-launch of the service. It will be interesting to see what lessons learned from other markets are brought on to the service.”

While the company is targeting opportunities in the cable sector, it still generates a healthy amount of its revenues from DTH (direct-to-home) platforms across the globe. In one of its biggest deals so far this year, the operator signed with Australian pay-TV provider FOXTEL to provide interactive services and middleware. It also has customers such as EchoStar and BSkyB among its client base. The operator is a key partner to a number of satellite providers worldwide.

Despite the fact it competes against such companies as NDS, owned by News Corp, and Microsoft TV in the pay-TV solutions arena, Chiddix still is confident the company has a number of competitive advantages. In terms of the competition, he commented, “Our prime competitive advantages are our installed base and our experience. The installed base gives us economies of scale that are helpful. Our experience allows us to deliver a mature middleware product that is well-tested and stable. I believe this is tremendously valuable to potential customers. Microsoft has been trying to get into this market for a long time. They don’t have much of a base, but they are determined and are not to be taken lightly. NDS is still digesting MediaHighway and its own core middleware. It is not clear yet what kind of product that is going to end up being, but we are certainly taking them seriously.”

(Contact, Maureen Zeljak, OpenTV, e-mail, mzeljak@opentv.com; Inaki Latasa, Hispasat, e-mail, ilatasa@hispasat.es)

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