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DirecTV finally offering video-on-demand

Posted Mar 13 2008, 03:18 PM by Kim Peterson
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DirecTV is finally going to offer a video-on-demand service. About time, too. Comcast and other companies are light-years ahead in this area, and on-demand is becoming a required feature for some consumers these days.

It's taken DirecTV this long because, as a satellite provider, it broadcasts a one-way signal. The technology doesn't allow for the two-way conversation that an interactive service like on-demand uses. DirecTV is going to work around this using broadband connections and digital video recorder (DVR) technology, according to the WSJ.

DirecTV shares are up nearly 1% on the news today to $25.21. The project is expected to launch in the second quarter.

The way it's going to work is that DirecTV will automatially send some movies to customers' DVRs for ordering. Television programs and other movies will be streamed over the Internet to the customers' set-top boxes. So it's not exactly "true" on-demand, but it'll do.

What if you don't want the movies DirecTV chooses taking up space on your DVR? DirecTV says that most of its 3,000 on-demand titles will be streamed online, and the videos that do get to your DVR will sit in space that isn't available to customers anyway. (Then what is that space there for, I wonder?)

Here's what people are saying about today's news:

Broadband Reports: "As we've stated repeatedly, this particular launch will be one to watch -- given you've got a satellite provider suddenly using a competitor's bandwidth to deliver high-definition content -- something that speaks strongly to the debate over a neutral 'Net."

Paid Content: "Think back to Cablevision’s maligned effort to allow viewers to use remote servers as a DVR, still being fought over in court. The main difference: it’s all stored on the user’s DVR, not a remote server. Still, some of it is copied onto the DVRs by the provider without user choice, one of the issues used to rule against Cablevision in U.S. District Court last year."

Silicon Alley Insider: "Will it dramatically boost revenues? Unlikely. Cable companies have hoped for years that on-demand programming would juice sales, but it's not happening. " 

Shelly Palmer: "It remains to be seen if DirecTV’s system can stream high-quality films without buffering delays, stuttering video and dropped connections. Stay tuned - this is a high-profile experiment in content delivery."

Blogging Stocks: "Three well-funded competitors trying to get market share usually leads to a price war. Getting "on demand" TV services is probably about to get much cheaper." 

Disclosures: I don't own shares of any companies mentioned in this post. And while Microsoft owns this blog, Microsoft does not control, censor or otherwise have any editorial influence over what I write. 

Comments

 

I wonder if DirecTV will ever catch on.  Think.. they buy Intellon a broadband server over your power lines , Qwest, a sinking telephone company, now we have power people.  Comcast be gone.  Rural properties have been a huge problem.. and huge money not going into their pockets.  A monopoly at best.  DirecTV is big enough to do this.  How long is DirecTV going to take the back seat?  Not long, I'd say.  

Direct TV's efforts to deliver near Video on Demand is far too little, far too late.  The cable companies are miles ahead and poised to open their lead.  By the time the first Direct TV client finishes streaming their first video over their Deliberately Slow Line (DSL) connection the cable companies will be offering On Demand Shopping, Dating and Educational programming.  The old one way broadcast model is going the way of the Telegraph to the Smithsonian.

I don't care what they do until they offer local television stations in my town. They are worthless without that.

Just had direct TV taken out.  Poor setup.  DVD and VSH players on 3 tv's would not work. Difficult to use and poor picture quality on local stations.

Going back to cable TV. Much more dependable and many stations you received

are cut off 4-5 inches from the sides of the screen. Poor channel selection.

How many need a Chinese TV station.

Don't install Direct TV.

Nodish  

The one way broadcast model won't exactly be going anywhere until rural america gets on board. Most of the country is rural and a significant portion of the population can't get decent cable or high speed internet. Satellite will continue to be able to comepete in what it was originally marketed for. Giving rural america choice. What Directv is missing out on is that a large portion of rural america who uses thier services can't get decent high speed access. I think that will cause a problem in adoption for them. A portion of thier subscribers do have access and will gladly adopt this but it will never hit a large portion of those people that can't get access to fast enough internet. But I have to applaud them for trying. Though, why not use thier current bandwidth for on demand? Why not play a movie and have DVR's record them and move on to the next instead of having 4 channels playing the same movie over and over? It won't work for everyone but with the price of hard drives as they are maybe they could work on putting one in every box not just DVR's?

I encourage DirecTV to bring on demand service to the marketplace!  They have historically brought "new" products to the marketplace following the lead of cable telecommunication companies and underdelivered on the quality.  Think about the flop satellite high speed internet was!  This is just going to be another attempt for satellite to immitate cable telecommunications.  DirecTV will figure out their product isn't selling and try to force a price war.  I'll just be ready to relay facts to each of my customers--satellite just won't get it done on a half-baked plan like they are moving forward with.  VOD is not consumer's #1 reason for using their television but it will be.  The last thing you want is to bring a half-baked idea to a consumer and have them feel burned by what they expect vs. what they got.  By the time satellite figures this out cable companies will have advanced to bigger and better ideas for VOD.  I'm convinced consumers will have cable VOD offerrings in their homes by then, be used to them, and won't budge when the flashy satellite offerrings hit the market.  SO bring second rate products to the market so cable TELECOMMUNICATIONS companies can continue to win consumer's hearts and wallets.  It's just as simple as FACT vs. SMOKE SCREEN offers.

The beta is already available and having used it for the past few months I can say it holds a great deal of promise and works seamlessly - so far.  It is great to finally have this option from a provider that offers superior HD options, picture quality and customer service when compared to cable.  What good is VOD with a crappy picture that in most cases is analog vs. the all-digital provided by Direct TV.  

This sounds like a stop-gap measure, but should work in urban areas where broadband is readily available at sufficient speeds.  In urban areas, however, fewer customers have access to broadband, and even then it is at slower speeds.

I am not up to speed on satellite capabilities, but it would seem that beaming the content to the satellite in the same way that normal programming is loaded, then beaming it down to the customer would be the best solution.

What about the customer who wants On Demand programing but doesn't have the DVR to accept the movies? Offering something just for the sake of saying you offer it doesn't necessarily mean it's going to be quality. I have my reservations about this one. Nice try Direct TV.

I don't usually do movies but look forward to the on demand option with my Direct TV service.  By far Direct Tv has offered better customer service, benefits and quality over the horrible Charter service in central MI for years now and that alone makes up for any competitor in my book.  Rest assured, Direct TV may be behind in the "on demand" service, but they will get it right!!

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