NBCU: “U” also Stands for “Ubiquity”

Todd Chanko | February 08, 2006, 05:01 PM

Is the Internet it? Bob Wright seems to think so. NBCU has just announced a deal with Aeon Digital providing "NBC Universal movies and TV events available to Aeon Digital customers via their DV-220 set top boxes." Now what constitutes a "TV event" is unclear. What is also unclear is the size of the market for Aeon's set-top boxes. The multi-city company, based in LA, Silicon Valley, Montreal and Shanghai, is making a play for near-vertical integration: it offers consumers media subscription services, wireless enabled,sexy LCD monitors and their own Diva-branded set top boxes. The challenge Aeon faces is competition for space in the living room, though Aeon’s monitors apparently offer the requisite video inputs, including DVI/HDCP. The company’s slogan, "IPTV Without Borders" is appealing to us media watchers but is next to meaningless to average consumers.

For its part, NBCU has energized its overall distribution strategy by expanding into several digital arenas at once. Online Trio is a good example. So is unifying the strategy under Beth Comstock. Having once taken part in NBC’s company-wide digital rights review, I’m excited to see those efforts beginning to bear fruit. Yet, being first to market can mean being lonely for a while. The networks may wish to create an alternative distribution association - carefully avoiding anti-trust laws, of course - in order to help create a new TV distribution category. As innovative as NBCU's undertaking with Aeon may be, it needs its otherwise rivals to join in.

Of course, the MSOs are increasingly being placed in a predicament: by providing broadband access, do they risk cannibalizing their core TV distribution business?

Sort of. Overall broadband households will approach cable households by 2010 - but only half of all broadband households will be provided by cable operators. In practice, I doubt it. There would have to be far more programming available for companies like Aeon to make a dent. Besides, do the two Bobs - Wright & Iger - really want to forego MSO programming revenues?

What’s next? A Bravo/Trio MVNO?