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Comments on news posted 2014-03-05 11:12:24: Speaking at the Morgan Stanley Technology, Media & Telecom Conference this week, Verizon CEO Lowell McAdam again reiterated that Verizon is interested in offering an "over the top" Internet video service outside of the company's traditional FiOS and .. ..

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xNPC
As Usual, Have Nice Day
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join:2000-11-08
Errington, BC

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xNPC

Premium Member

oh look

it's lowell mcwireless patting himself on the back again. excuse me while i puke.

kapil
The Kapil
join:2000-04-26
Chicago, IL

1 recommendation

kapil

Member

Ivan

Bring back Ivan!
Millenium
join:2013-10-30

Millenium

Member

...

What does over-the-top mean? A regular tv subscription will be required in order to subscribe to the over-the-top streaming service? Not available as a stand alone product? I ask because it would seem great if they started offering simple, inexpensive, stand alone streaming services.

Next question: Who is going to steam over mobile? Once you get past the 3" screen size there is that whole data cap problem.

nothing00
join:2001-06-10
Centereach, NY

1 recommendation

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to xNPC

Net neutrality

Can't wait for Comcast and AT&T to charge him a premium for dumping all of that video traffic onto their networks.

yup
@verizon.net

yup

Anon

First thing I though of. LOL
caps620
join:2009-01-18
Central NJ

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Re: ...

That's the whole idea of the plan ...... offer the video and cause everyone to go over their data cap so Verizon can take more of your hard earned money.
elray
join:2000-12-16
Santa Monica, CA

elray

Member

What relevance?

I don't see why Verizon, as a "traditional pay-tv provider" (really?), should expect any leverage with regards to streaming rights, and I question why Karl even makes that point.

The content industry has the right to determine the asking price for their product.
No technological evolution changes that, or confers rights to the distribution networks, virtual or physical, to dictate what they will pay.

mushmouth
join:2001-12-13
Earth

mushmouth

Member

Time for Lowell to give himself and his vz buddies another great idea pat on the back worth millions in compensation.
JPL
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join:2007-04-04
Downingtown, PA

JPL to elray

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Really? Because Verizon has a few million cable TV customers. That's why. The contract negotiations that these cable companies have with content providers is governed, partly, by the size of the cable company's footprint. If I can bring your content to 10 million subscribers vs. say 5, that gives me more leverage as a cable company. And I can negotiate a better rate than a smaller company.

mikesterr
join:2008-04-18
Sanford, FL

mikesterr

Member

This has Always been the goal

Even when Ivan was there the end goal was always to provide Video over Wireless Data plans. They sold all of those territories to Frontier with the thought of coming back into those areas with a wireless video service.
As for the data caps they can easily not charge against the cap for Video from their own system, the Redbox instant doesn't hit your data caps (or isn't supposed to anyway). The real question is Will they do that. Probably at first, get people hooked then tell them they are going to charge extra or that you must move into a higher data tier.
JPL
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Downingtown, PA

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Re: ...

Imagine getting FiOS TV service over say your Comcast internet connection. That's basically what they're talking about. Yes, you would be a TV subscriber, but to FiOS TV. Is there a market for such a thing? I think there is. The big wall that service providers hit (e.g. google, apple, amazon, what have you) is that the content providers don't want to upset the traditional apple-cart. They make alot of money by having these contracts with cable companies. But if you have a cable company that's setting up that type of streaming service... you already have an avenue for getting the content providers to open up their content to streaming. I think that's Verizon's ploy here. Will it work? Guess we'll see.
elefante72
join:2010-12-03
East Amherst, NY

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Re: What relevance?

Well if you look at the cable/Telco operators only the cable guys own content networks. If Comcast/TWC merge that is a pretty big control of stations. And even though TW is theoretically a separate company, you get the point.

Verizon is betting ("lobbying") that the Comcast merger will raise eyebrows if VZ comes up w/ an OTT and them Comcastic starts clamping down on their streams. All of a sudden net neutrality will be for the people again....

Verizon owns no content company, only rights. So in order for them to monetize their networks they have to utilize them, and that means finding stuff for the plebs to consume. And that means video. The rest won't put a dent in their fiber or wireless networks.

Since Verizon dumped all their landline debt on unsuspecting wireline providers, its either grow margin on wireline, or sell it. Verizon knows however that owning the pipe is just as good as owning the oil that flow through them, because they can control WHERE the oil comes from.
elray
join:2000-12-16
Santa Monica, CA

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So you think Verizon is going to put their wired customers on the table to obtain streaming rights? Have you followed any of the "cable" negotiations that have taken place in the past ten years? Can you name one instance where the provider dropped a major channel / network instead of paying? (And no, the weather channel doesn't count.)

Ironically, in the case of IPTV/OTT streaming content, the exact opposite is happening - Verizon has the cash, as does Netflix, Intel, Microsoft and Google, among others, necessary to grease the content industry into permitting liberal streaming contracts, but they steadfastly refuse to do so.

Instead, we continue to read, ad nauseam, of "disruptive" technology, as if has an inherent birthright to deliver coveted programming without justly compensating the networks and studios.

It isn't impossible - there once was a time, in the era of BUDs, when wholesale / bulk subscription pricing was available to end-users, Dish once did a la carte, and both Sezmi and USDTV negotiated for a dozen or so popular cable channels for encrypted OTA delivery.

But it will take a major distributor willing to pay the premium to break the logjam.

ITALIAN926
join:2003-08-16

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Re: ...

Potentially, a way to bypass town franchise agreements as well. So fios expansion into new towns is a huge possibility, requiring large pipes to stream to multiple tv's simultaneously in a household.

xNPC
As Usual, Have Nice Day
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Re: This has Always been the goal

got to add that deregulation in there too. they want that more than anything.
tmc8080
join:2004-04-24
Brooklyn, NY

tmc8080

Member

evolution..

how about evolving their FIOS service to gigabit first and reverse your outrageous pricing? I don't think $70 a month for 15 megabit tier is doing right by the consumer these days! Verizon always seems to have money for everything else. 130 billion for Vodafone debt. Billions more for wireless LTE, Millions more for Intel's video streaming patents, etc.

ITALIAN926
join:2003-08-16

ITALIAN926

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So if you were CEO of an MSO, you would drop internet prices for the good of the people?. Hence why, youre not a CEO.
I strongly suggest you look at the quarterly reports for any wireline company.
JPL
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Re: What relevance?

Yes, that's exactly what I think Verizon plans to do. An approach is 'disruptive' only if it totally up-ends the existing distribution scheme in place. And this really doesn't. We're not talking ala carte here (not sure why you think that comes into it). We're talking about Verizon using their bargaining power to cut deals with content providers to allow them to pick up customers outside their fiber footprint. The distribution scheme stays in place. For example, let's say Verizon does this. They wouldn't be offering, say, ESPN ala carte. They would still be distributing it just like they are now (paying ESPN for every household in which the channel is available). The only difference is that they would be using another network to provide the feed. The distribution scheme, though, remains unchanged. You would subscribe to FiOS TV, just like any other customer who is on their fiber can do. Verizon delivers you their traditional TV service, just like they do to existing customers. Again, we're not talking ala carte. The one advantage that Verizon has over the Amazons, and the Netflixes, and the Apple and Google TVs of the world - they have contracts already in place with these content providers. I'm convinced that that's why Google added TV service to their fiber.

Will it work? Dunno. But you made the claim that you couldn't understand why Karl would even mention their subscriber base. Whether it works or not, the point remains - that's EXACTLY what Verizon is trying to do - leverage their current customer base to allow for over the top IP streaming - decoupling FiOS TV from the fiber. If I had to bet - I think they have a decent shot of succeeding at this. Will they get every channel? No, they won't. But they'll get enough. This strikes me as a MUCH smarter play than what those other IP delivery services have attempted to do up to now.
JPL

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Re: ...

Yes, there are clearly hurdles that need to be overcome here. Franchise agreements are part of it. They would have to have markets agree to allow in another provider. But that's not really that big of a hurdle, to be honest. Cable competition has been a reality for, what, 10 years now? Markets have already opened up to competition. If they were to move FiOS TV into a market already served by, say, Comcast and AT&T, why would it be a stretch to have that market be served by a third provider? Yes, they would have to hammer out franchise agreements, but in most markets that already allow multiple service providers (which I have to think, at this point includes most of the country), that's really not that big of a deal. Yeah, there will be areas that will be reluctant. Philly was very slow to allow Verizon to come in, e.g. But the door has been opened on that. Markets that were reluctant to allow in competition were really just engaging in protectionism. Comcast made some ridiculous claims of the evil that would befall the residents of Philly if the city were to allow Verizon to come in. It's the reason that Verizon was kept out from markets like Buffalo and Baltimore and Wilmington. But guess what? Verizon came in... and the world didn't end. In fact it was such a success that the markets that initially spurned Verizon's advances (all three of those that I listed) not only came begging for Verizon to expand into their markets, they all but sued the company to make it happen. The days of cable protectionism are over. Customers like having the additional choices, and what we've seen is exactly what we expect to see - competition driving up services, and quality (anyone think that Comcast just decided to offer 305Mbps service out of the goodness of their hearts?).

As for the multiple TV streaming... that's really not that big of a hurdle, is it? Verizon has been working toward that end for a while now. And besides, who says they have to offer the exact same level of service to those outside their traditional footprint?

ITALIAN926
join:2003-08-16

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ITALIAN926

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It wont last outside their traditional footprint, some cable companies are capped, and those that arent, will implement them. This is much worse than netflix as far as data consumption. Lets say only 5mbps is required per TV, now multiply those streams for each TV, for many MANY more hours per household, every hour, of every day, of every month.

My point was, it is probably more important to offer this service over their own pipes, not the cable co's even though the potential is there.

Im pretty certain I remember AT&T bypassed town franchises in CT because its IPTV, so that might be a state to state thing. Does DirecTV and Dish have to negotiate with towns? I think not. Why would streaming channels not be considered an internet "information service" , and the towns could go pound sand?
JPL
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Downingtown, PA

JPL

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I think there is a market to be served with this. Not all ISPs cap. And not all consumers have 5 TVs. An IP delivery would work just swimmingly for us, e.g., and there are 7 of us in our household - there are days when the TV never goes on, and it's actually really rare that we have more than one TV on at a time. That's not to say we don't watch stuff. We do. Most of it... streamed. It's NOT uncommon to have someone watching something on a TV while one kid is streaming Epix on her netbook, while another is watching videos on his ipod, while my wife is watching something different on her ipad. In other words... we probably do most of our viewing via streaming. And if it works in our household... why not in areas around the country with fewer occupants? I think it can work.

As for franchise agreeents - DirecTV and Dish don't negotiate them. There isn't a reason to. They don't use any utilities (e.g. poles) for their services. While some states make DBS consumers pay a 'franchise fee', it's really just a naked attempt at taking more tax dollars. Even with that 'franchise fee', you don't need franchise agreements to put up a satellite dish. As for AT&T... they USED to get away without procuring franchise agreements because of what you said. But I don't believe that's the case anymore. At least not everywhere.

My point is this - cable USED to be seen as a utility. Which means that locales would have one cable company, much like they have one power company, or used to have one phone company. The legal framework centered around that (hence the legal monopoly status cable companies had in those locales). That's not the case anymore. Many (if not most) states have eliminated that protected monopoly status, or have seriously reduced its restrictions. These areas have already changed their legal framework to allow for cable competition. Verizon can move into large swaths of the country where cable competition is a legal reality. That doesn't mean they don't need to procure franchise agreements. I believe they do. But the legal frameworkd is already there, in most markets, to allow it.

I think you're overstating the hurdles, to be honest. The first company that can crack that over-the-top-ip-streaming nut will make out like bandits. The reward is huge. Which is why so many companies have tried. And which is why Verizon is doing this. I just think that their approach is smarter than any that have come down the pike so far.
JPL

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One other point with this - ip streaming live tv is such an insurmountable hurdle... that AT&T does it with U-Verse. While many complain of the PQ, the fact remains - U-Verse is extremely popular. It's growing almost as fast as FiOS is. They managed to do full-house IP delivery of video, make a ton of money doing it, but Verizon can't do the same? And AT&T is doing it over twisted pair! Like I said... I think you're overstating the hurdles with this.
serge87
join:2009-11-29
New York

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Re: Net neutrality

said by nothing00:

Can't wait for Comcast and AT&T to charge him a premium for dumping all of that video traffic onto their networks.

'But that's not fair, Comcast's/ATT's customers requested that data!'

Sound like anyone you know?

ITALIAN926
join:2003-08-16

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Re: ...

Im not saying or even hinting that streaming is a bad idea, I think its a great idea, but I think its one that wont last long when implemented over cable pipes. I love the idea that it removes QAM capacity limitations and opens the door to an infinite # of HD channels.

Put yourself in Cablevisions shoes for a minute. They provide the last mile pipe, and Verizon will be providing the TV service over it?, eating massive amounts of data?. It will be 5 minutes before they implement a cap. Streaming live broadcasts to TV's like that, often remain on all day will be much, much worse than Netflix as far as data consumption, not to mention the 100% removal of TV revenue from Cablevisions bottom line.

When someone streams Netflix, sports programming, or some channels have websites with streaming, there are no city/town TV franchise agreements to worry about . I fail to see how a company (like AT&T) should be accountable to deal with towns when streaming video essentially the same way.
ITALIAN926

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and PS, to make myself more clear regarding the franchise agreements and streaming products. Maybe Im just wording my point of view badly.

Lets say theoretically, all traditional DSL could suddenly push 100Mbps. ( or a new MPEG10 that can provide stunning HD quality over a 768k DSL lol) Suddenly Verizon can now provide this new streaming service over it, and the towns should still have the ability to string Verizon up by the balls? But if it was a startup company called "Aereo", the towns would no longer give a hard time regarding streaming live broadcasts? In reality, I would think Verizon could tell the towns to go pound sand being that the infrastructure is already in place.

What exactly is the legal difference here? Is it LIVE tv? Netflix , hulu amazon get to bypass franchise agreements, and air shows that were once aired live on TV. Fine, if being LIVE breaks the deal,then Verizon could implement a 10 second time delay with no adverse repercussions.
JPL
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I guess I don't understand why you think video streaming would happen all day/every day. Who watched TV like that? In most households, you have one, maybe two, TVs on at any one time. And at most, you're probably talking a couple hours at night. How is that different than streaming a movie from Netflix? Second... as I said before... AT&T does it. And they do it over a VERY small pipe.

As for the franchise agreements and why Verizon would probably need them - they would be a full service cable content provider. The courts have ruled that Aereo isn't one (which is why they're allowed to operate as they are without having to pay for OTA feeds), and Netflix isn't either. There are rules that govern 'cable companies' that don't apply to other, even similar, utilities. For example DBS companies aren't required to carry all must-carry locals. A few years ago the FCC tried to roll that on them, but the DBS companies objected saying (rightly) that the cable companies only have to provide locals in markets they serve. Which means, if you follow the same definition, because the entire country is served by DBS... they would have been obligated to carry tons of channels that cable companies wouldn't. The FCC relented and instead issued a 'carry one, carry all' rule - basically saying that if a DBS company provides any locals to a particular market, they have to carry them all.

AT&T, btw, DOES have to get franchise agreements now. And the reason - they need to actually run lines in these neighborhoods. If they could deliver without having to do anything like that, then yeah, they could probably get away without the need for franchise agreements. Those agreements btw are an anachronism - held over from the days of legal cable monopolies (they were designed to ensure that no consumer was denied access to cable within a market). But that doesn't mean the rules no longer apply. It's no different, e.g., than with voice service. With traditional land-line service there are all sorts of fun telecom fees piled onto your bill. That's not the case with VoIP. Not yet, anyway. Eventually I think the rules governing video delivery will provide for a true level playing field. But right now, it's not there. There are rules that affect 'cable' companies that don't affect others. Another such example - seperable security for cable boxes. Cable companies are obligated to provide for it... other similar companies (DBS and IP) are not.

I'm not really sure whether this experiment would require that Verizon get franchise agreements for their service or not. Time (and the courts) will tell on that. It'll be up to the FCC and the courts to decide that one. Point is - FiOS is considered 'cable' which is why they are beholden to certain regulations. AT&T is not considered 'cable' but franchise agreements apply to U-Verse because they have a physical presence (currently) in their markets. They have to string fiber to nodes (VRADs) in all these neighborhoods. The franchise fees are meant, partly, to subsidize that.

This is all uncharted territory (much like Aereo was), and the courts will undoubtedly step in to decide how this over-the-top-ip-delivery fits in the grand scheme of things (just like they did with Aereo).

ITALIAN926
join:2003-08-16

ITALIAN926

Member

Most households turned on or two at a time? Come on JPL. Ive seen a hundred households where TV's are left on non-stop , all day, serving as nothing but backround noise. Although you may be under the impression that most households run a couple TV's for just a couple hours a day, it doesnt change the fact that plenty of households have 6,7,8,9 even 10 STB's in a house, and any video provider should have the capability to provide it. So, for situations that Verizon steals away a video customer over Cablevision internet, it would be naive to think Cablevision will not implement usage based billing or CAPS. Not to mention Verizon would run into the same congestion issues that Netflix has been experiencing.

I just wouldnt buy stock in such a product since the OTHER MSO's will not take kindly to it, and have full control of whether it succeeds.
JPL
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JPL

Premium Member

None of the households I've ever been in. I'm sure they exist, but come on. If those types of households are so prevalent, then please explain for me the popularity of U-Verse, as just one example. With that system you're limited to a total of 4 feeds per house. Period. And yet, they still manage to stream video - live TV video - to millions, using ip over a very small pipe. You're using a hypothetical - I'm using an example of a real company delivering just the type of architecture that you seem to think is so impossible.
tmc8080
join:2004-04-24
Brooklyn, NY

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Re: evolution..

The NY metro market will not bear $70 for standalone 15mbit internet. There are regulatory remedies at government's disposal which were part of the Ma-Bell breakup (and 96-06 reform legislation), but what's been happening as of late is apathy. This is why telcos and cable companies are STILL treated differently. They can't be trusted to do right by the consumer. It remains to be seen if the decline in a robust marketplace will result in government intervening. The decline of a robust marketplace here means it most likely won't exist elsewhere either, except where there are small pockets of change. Google plunked down it's claim on some of these 'other' geographies already.

Who knows how dysfunctional the NY metro market has to be for a company such as Google to get involved... I'll admit it's not all bad on the PR front (since VZ offered $79.99 triple play as late as Dec, 2013), but take a gander at these headlines.

»stopthecap.com/?s=verizon

BTW, if you ran a company based on quarterly reports & WALL STREET GREED back in 2007 - 2010, you WOULD NOT HAVE A COMPANY TODAY! Lastly, think about geographies in 14 states which will now have a Telco similar to CenturyTel or worse in lousy (for the customer) deals by Fairpoint/Frontier. How about moving to one and see how green the grass is for those customers?

ITALIAN926
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Re: ...

You are calling for VZ to deliver over an architecture that isnt theirs, and are at the mercy of those providers. What we're talking about isnt Netflix. Its turning other providers literally into a dumb pipe, and theyre not going to stand for it.
IPTV over FiOS internet, GREAT. Over others, not so much. Its a nice idea, but I dont think it'll be too successful. Putting aside that they are at the mercy of the otherMSO's, the carriage fees that Verizon already pays will still apply, and it wont make any financial sense for people not simply go with their own tradional TV providers. The networks will not give VZ any breaks because its IPTV, ESPN will still cost $5 , Animal Planet will still cost 30 cents , so and and so forth.

Think about this. Verizon themselves offer their triple plays for the same price as voice/internet, or very close to the same price. Would it make any sense to pay Verizon $79.99 for internet, then $50 for Cablevision TV over it, if they chose to follow the same footsteps?? There wont be any savings for people to make such a switch, overall it might cost more. *shrug
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