We have to say we were mightily impressed with the deal cut this week by US video upstart start up, Sezmi and the Malaysian power utility YTL to introduce a hybrid pay TV service as part of a WiMAX based quadruple play, initially in Malaysia then spreading across local territories. The network spend is already cited as $1.5 billion, much of it is already built and the network will be live with two way data and voice over WiMAX this year, and video early next.
YTL in Malaysia owns power companies across the region, has built high speed rail links and is involved in everything from cement manufacturing to major building projects to technology incubators and ISPs and is one of the biggest conglomerates and public companies in the region.
It’s especially interesting as the 27 million population of Malaysia has Indonesia as one of its nearest neighbor, which is the fourth most populous country in the world with over 240 million people. YTL has links there and it could be one of its next targets.
This part of the world, along with India and China, parts of Eastern Europe, all of Africa and much of South America, has little cabling in the ground and is a breeding ground for these types of wireless only hybrid TV models, which is why these are the areas which already tend to be trying out advanced WiMAX networks. If it works in one, it might take off in another with the consequence being that the ideas begin to take off closer to home. Right now satellite DTH TV is skyrocketing in India and South America, because it is the easiest way to create a continent wide overnight TV footprint, but similarly these are the countries where cellular has also rapidly taken off ‘ for instance India has only 35 million fixed lines in the entire country, but some 652 million cellular phones. So this approach, perhaps with a hint of DTH, and over the top VoD, might also work there.
Sezmi says that it is running the show pretty much on all of the installation of the new broadcast part of the network, building out the NOC, helping to plan TV channel delivery across a new, purpose built DVB-T2 multiplex and across the WiMAX network, using unicast delivery at first and multicast later, if it is needed.
While Sezmi insists that global pay TV was always on its mind, it started life creating a $5 a month pay TV service in the US, which even now only reaches 35 US TV markets and is only at full service implementation in California. Even that was a hybrid, using spare over the air ATSC broadcasting capacity for scheduled TV delivery and an internet connection for VoD programming.
The publicity machine got working and Sezmi’s story got told and then the phone rang and it was YTL calling from Malaysia saying ‘You’re doing exactly what we’d like to do, can you help.’
Chief marketing offer Dave Allred laughed at this and says, ‘That’s pretty much what happened. There were some US people who were WiMAX specialists who found themselves working with YTL and they suggested they come talk to us.’
But the logic is compelling, and we’ve said so from day one, in favor of the type of model that Sezmi operates, when compared to traditional pay TV.
The Malaysian system will rely entirely on a WiMAX return path and this gives feedback to network management and CMS systems in the cloud. That means that the most popular programming is routed over the DVB-T2 network and the VoD and least popular programming goes over WiMAX. Audience measurement is also automatic. Video delivery is QoS delivered when it travels over WIMAX and the DVB-T2 is HD capable and the multiplex will deliver some SD and some HD programming.
Sezmi has helped with YTL’s the negotiations with Hollywood and has its own content team in place in Malaysia and Singapore which buys content from the wider region. Sezmi in the US uses Secure Media conditional access, a company now owned by Motorola. We immediately wondered if perhaps this deal was why Motorola bought Secure Media earlier this year and perhaps it has a significant stake in the provision of the core WiMAX network for YTL as well as transmission systems. We’ll try to find out.
The WIMAX system won’t actually use the inbuilt multicasting capability right off, but it could come in handy when the system starts to reach capacity, ‘There’s no need for multicasting yet, but we have that ability down the road,’ says Allred.
He outlines the YTL position on taking this proposition out to the rest of the region ‘ to neighboring countries like Indonesia and Singapore. ‘The YTL WiMAX network is one of the most dense networks of its type in the world, it’s going to a soft launch now and a full launch early next year. There are already a full suite of devices which are voice capable from day one. The idea is to create this system for all of Asia ‘ the NOC, the data center, the CMS, and then deploy it across multiple regions.’
It’s envisaged that YTL will partner with local telcos and broadcasters in these regions to bring local language channel bouquets to market along with full quad play services, mostly using WiMAX, but where there are no WiMAX plans it could do this across LTE or fixed lines perhaps, as long as it’s IP based.
One of the big things that Sezmi brings to the party is a favorites list that the system compiles for itself. If gives everyone in a house a button to identify themselves when viewing and then remembers what you watch, and in particular what you view the whole way through. In the US system it will save programs to its the 1TB DVR under your name and put it on your favorites list, without even asking. If you don’t view it, it may not do it again. When viewing, you go to your favorites button, which both tells the system who is viewing and shows your suggested programs whether they are live, on VoD or on the DVR.
It is this type of intelligence that makes a 50 channel system feel like a 300 channel pay TV service ‘ in fact it is likely to feel like a service which has more programming which you like ‘ rather than more programming which is not for you. This code is a core competence of Sezmi and the main reason that it has attracted so much attention.
The deal has been cut between Sezmi and YTL Communications, the Internet arm of YTL. When the system goes live it will include watching TV on a number of devices, and because the search and recommendation tools are all in the cloud, this will work on a tablet or a WiMAX handset as well. All programming to a handset or tablet will sense that the recipient device is portable and route the TV signal over the WiMAX network. Android tablets will be included in the viewing devices from day one.