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21 November 2019

Nagra serves up dessert platter to sweeten reaggregation trend

Nagra threw some shade on an otherwise “exemplary” presentation from Tele2 at Cable Congress last week, saying that the transformation to machine learning and advanced streaming analytics techniques is not representative – describing a “much messier” process for most operators.

The industry is seeing the control plane being driven by commoditized hardware and the virtualization of services including the head-end, online video player and encoding. But, warned Nagra’s SVP Marketing Ivan Verbesselt, we should be aware that content pirates have exactly the same horizontal infrastructure.

While widespread, this is something we have observed most recently in the agreement between Comcast and Harmonic, placing the control plane in the middle of the network and the data plane out among the forwarding components, like the RF tuners, to create a new operating system for a converged cable access platform (CCAP).

Faultline has covered network technology takeaways in plenty of detail in separate Cable Congress articles, so we’ll take a look at the content side of the coin now. Verbesselt launched into an amusing but perfectly suited dessert analogy for the cable industry in the sense of reaggregation versus fragmentation.

He warned of a fragmentation tipping point, whereby consumers are becoming overwhelmed having to trawl through numerous content silos in an aggregated operator environment. Think Netflix plus Amazon plus HBO plus Disney+ plus AppleTV+ plus countless sports services – and that’s just scratching the surface of aggregable OTT video offerings. Operators can aggregate until the cows come home but without a bundling discount, this super-aggregation strategy becomes pointless.

Operators can take on three forms of chocolate – a jar of M&Ms (basic), a layered chocolate mousse (more-refined), or a layered chocolate mousse with adding toppings (more integrated). There is no wrong choice.

Firstly, Verbesselt’s jar of M&Ms approach to super-aggregation is where an operator is happy with a simple HDMI-1 integration – bundling in OTT applications alongside each other in a single streaming device like an Android TV set top. He admits that this hardly qualifies as super-aggregation, but is not to be scoffed at for the purpose of fitting the roadmap of an operator more focused on broadband.

Next up is the layered mousse, where operators serve up an uncluttered and easy to navigate UI comprising content from a variety of sources. Here, Verbesselt warns, operators must master efficient OTT content onboarding by including features such as single sign-on and cross-application search to an extent – linking the metadata of the underlying OTT bouquets.

Finally, an operator can jazz up its layered mousse with toppings while using its own content catalog and UI as the anchor tenant for integration. Deeper integration and more efficient metadata linking increases an operator’s ability to realize active content monetization, he highlighted, suggesting AI-assisted catalog curation and promotion while embracing OTT add-ons.

“Most cablecos will have a layered cake in their pursuit of super-aggregation. They can include things like single sign on to smooth over the process, but ultimately this involves some element of fudging. However, there will never be another single operator-branded catalog accessible through a monolithic UI, equivalent to a homogenous chocolate mousse,” he concluded, drawing a mix of genuine and nervous laughs from the Cable Congress crowd.

Figures were cited showing that 77% of pay TV operators believe they will emerge as super-aggregators in the future. “But this is like asking people if they are better than the average driver – 90% will say yes,” jested Verbesselt.

Elsewhere in Berlin, there was a rare cameo appearance from Sky at a show dominated by Liberty Global and Vodafone. This came in the form of Sky Deutschland MD of Legal, Regulatory and Distribution, Dr. Holger Enßlin, who could only apologize for a recent outage to the Sky Ticket service in Germany. “This was a bad experience, but we will learn a lot,” was all he could say on the matter.

Trends for 2020 were discussed briefly in a panel coined ‘There is Nothing Permanent Except Change’. Enßlin pointed to aggregation as his number one trend for next year in the cableco sphere, while VodafoneZiggo CEO Joreon Hoencamp said – rather un-insightfully – “the proliferation of apps”. Hoencamp specifically cited partnering with OTT services rather than competing with them as a key trend, which is actually a six-year-old trend.

Liberty Global Board Director Miranda Curtis, however, provided some genuine insight. “Deployment of capital is the biggest challenge facing Liberty Global. But we are now seeing B2B growth outperforming consumer growth and there are huge opportunities not being addressed by executives,” appearing to direct this comment at C-level execs not just outside the Liberty empire, but inside too.

European regulations were naturally a hot topic at Cable Congress, as last week’s coverage showed, although there were disagreements. Vodafone Group’s External Affairs Director, Joakim Reiter, said the European Commission should shift its approach from innovation by permission, to innovation first, instead of micromanaging businesses.

While some speakers scrutinized draconian regulations in Europe, particularly in Germany, Curtis described European policies as some of the “most rational, pragmatic and consistent we have seen in the world.”

If that was the case, Cable Europe would not have been forced into changing its spots to GigaEurope, although we certainly approve of the rebrand and hope it serves as revitalized face for the cable industry.