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FIOS RIDES HBO'S ‘FERRARI'

3/12/2010 7:16 AM Eastern

New York — HBO last week
debuted its “HBO Go” broadband
portal with Verizon Communications,
as Comcast turned
down the chance to hook into
the premium programmer’s service
in favor of its own Fancast
product.

Verizon FiOS TV and Internet
customers who subscribe to
HBO will be able to access more
than 600 hours of content, for no
additional charge, by logging in
at either the premium network’s
HBOGo.com site or via a Verizon
site. About 25% of the content will
be refreshed by HBO every week,
with new episodes available on
the service immediately following
their TV premiere.

The portal, which features an
attractive interface, will be cobranded
with Verizon and other
participating affiliates. The service
is “HBO On Demand with
the engine and styling of a Ferrari,”
HBO co-president Eric Kessler
said in a presentation here.

“Ultimately, this is about extending
the subscriber life cycle,”
Kessler added. “It’s more about
subscriber retention.”

Comcast offers the same
600-plus hours of HBO content
through the Fancast Xfinity TV
online service, which the cable
company launched for doubleplay
cable TV and broadband
customers nationwide in December.
However, Comcast has
declined to provide access to the
HBO Go interface. Instead, Comcast
customers will be redirected
from HBO Go to the MSO’s Fancast
site.

HBO, for its part, is not contemplating
offering an online-only
version of the service: “This is affiliate friendly,” Kessler said. “Our
target audience for this is the 100
million [U.S.] TV subscribers.”

HBO began discussing its
broadband strategy, which has always
been intended to reinforce
the existing pay TV service, as
early as spring 2007 under then-
CEO Chris Albrecht. The programmer
initiated a trial with
Time Warner Cable’s Wisconsin
division in January 2008, providing
around 400 hours of on-demand
video via the Road Runner
cable-modem service.

At this point, Time Warner Cable,
an erstwhile corporate cousin
of HBO, is not currently working
with the premium programmer
on an authenticated online service,
according to spokesman
Justin Venech, who declined to
elaborate. TWC last summer said
it was planning a 5,000-home test
of a TV Everywhere service with
about a dozen programmers, but
HBO is not currently in the mix.

Comcast representatives did
not respond to inquiries about
why the MSO declined to offer
HBO Go. Previously, though,
Comcast executives have argued
that using Fancast would provide
a better overall user experience
and allow it to launch the service
quickly.

“At the end of the day, you have
to have a great consumer experience.
They need to get a great
payoff . They need to have a consistent
experience across content
and content providers,” said
Comcast Interactive Media senior
vice president of Fancast and online
entertainment Karin Gilford in an interview last year.

Compared with the Fancast
site, Kessler noted, HBOGo.com
is “a more HBO-centric experience.”
He said the aim with HBO
Go was to present the programmer’s
content in a highly visual,
easy-to-navigate interface.

“The content is always front
and center,” Kessler said.

Verizon, for its part, is looking
to capture the edge in being
“first” on a new video service.
“It really is about answering the
consumer’s demands,” said Verizon
vice president of consumer
strategy and planning Shawn
Strickland.

It’s worth noting that Verizon
was the first TV distributor
to announce a deal with Epix,
the joint-venture movie service
from Paramount, Metro-Goldwyn-
Mayer and Lionsgate, and
currently off ers the Epix online
component to subscribers. In addition,
the telco offers the Starz
Play online movie service to
broadband customers for $5.99
per month.

With HBO Go, Verizon also
hopes to see a promotional boost
and benefit from buzz about the
service, as the parties plan to promote
the partnership with an advertising
campaign that includes
newspaper ads, TV spots, online
ads and billboards.

HBO Go’s 600 hours of programming
represent four times
the amount available through
HBO On Demand, according to
the network. Currently, for example,
HBO Go provides every
episode of the original series. The
Wire. The service also includes
exclusive and bonus material,
soundtrack and cast information,
and parental controls.

HBO Go uses Adobe Systems’
Flash media player as well as
the Adobe-developed encrypted
Real-Time Messaging Protocol,
referred to as RTMPE, as previously
reported by Multichannel
News. The service is available on
both PCs and Macs, whereas the
previous broadband service tested
with TWC Wisconsin was Windows-
only and used Microsoft’s
digital-rights management system.

Th e video is in MPEG-4 format,
encoded at two different bit rates:
1.2 Megabits per second and 2.6
Mbps. If a customer attempts to
access HBO Go on a connection
that can’t keep up, the video is
buffered.

HBO Go was defined and built
in-house, while the interface was
designed with an outside agency,
New York-based R/GA.

Affiliates who participate with
HBO Go are responsible for providing
authentication and a content-
distribution network to
deliver the video to subs. Verizon
“already has an extensive CDN,
and our goal is to get the content
as close to the user as possible,”
Strickland said.

FiOS users will be able to access
the HBO Go service from
up to three diff erent computers
simultaneously, the companies
said. Th e Adobe RTMPE provides
a form of digital rights management
to inhibit piracy, according
to HBO executives.

HBO Go isn’t the only programmer-
led “TV Everywhere”
initiative. HBO’s parent, Time
Warner Inc., has been beating
the TV Everywhere drum loudly,
with TNT and TBS part of Comcast’s
Fancast Xfinity TV service.
Those two Turner Broadcasting
System networks also are participating
in trials with Time Warner
Cable, Verizon’s FiOS TV and
others.

September