Node, Vidi add spice to SA television - TechCentral

Node, Vidi add spice to SA television

Duncan-McLeod-180-profileSouth African couch potatoes have never had it so good. In the past fortnight, two new video-on-demand (VOD) offerings have been launched, one using broadband connections to deliver entertainment into people’s homes, the other using satellite as its primary delivery vehicle.

Times Media Group, publisher of the Sunday Times, was first off the starting blocks with Vidi, which takes advantage of consumer broadband connections to deliver streaming on-demand entertainment. Vidi is similar to Netflix, the US service that pioneered the online streaming model, in that it offers unlimited access to its catalogue of movies and television series for a fixed monthly fee (R149). Subscribers can also rent movies on demand, with the latest blockbusters costing R27 each.

But relying on South Africa’s notoriously poor fixed broadband infrastructure — as surely it must given that mobile broadband remains far too costly to stream video — is a brave move.

The barrier to entry is lower than the satellite alternative, but fixed broadband penetration in South Africa is low relative to developed markets — there are fewer than a million digital subscriber lines in service — and it’s impossible to ensure a uniform streaming experience for consumers.

Many Internet service providers apply aggressive bandwidth shaping to their uncapped broadband accounts, meaning Vidi’s streaming content isn’t guaranteed to have priority. And when video starts buffering and stuttering, consumers are likely to blame Vidi quicker than they do their ISP.

Times Media says Vidi will work on lines as slow as 1Mbit/s and the stream will vary in quality automatically to take advantage of whatever bandwidth is available, but faster access is recommended for high-definition video. The fact that it has local content servers should help.

The second offering, which was launched on Thursday, is broader. Technology company Altech — part of the JSE-listed Altron stable — is hoping the Node, a satellite set-top box that offers VOD along with a range of other features and services, will become a big money spinner for the group.

Similar in a way to the BoxOffice service available on DStv personal video recorders, Altech will push content via satellite to the hard drives in its set-top boxes. This means there’s no need to stream content over the Internet, with consumers able to watch a range of programming directly from the set-top box in Blu-ray quality with no concerns about their Internet connection speed or their data consumption. Subscriptions are R299/month, while the box costs R3 499.

Altech certainly has the skills to pull it off. Its Durban-based Altech UEC subsidiary is a world leader in set-top box manufacturing and understands the technical, commercial and legal complexities involved. Altech has signed content deals with four of the six major studios and plans to add more content to the service over time.

Altech's Node

Altech’s Node

But what’s perhaps more interesting about the Node is that it doubles as a platform for home automation, as a payments platform and even as an Internet telephone. Consumers will be able to use it to control security cameras, motion detectors and decide when they want their lights to come on or be switched off. They’ll be able to pay their bills and traffic fines and shop online.

Time will tell which model — Altech’s or Times Media’s — will prove more appealing to South African consumers. The Node and Vidi certainly provide more choice to South African television viewers. And they — and similar services yet to be launched — will chip away at MultiChoice’s dominance in subscription television. Of course, MultiChoice is not sitting idly by. It is actively developing its own VOD offering, preparing for the day when (it’s not a case of if) on-demand viewing eclipses traditional linear broadcasting.

But even bigger threats are looming on the horizon. International players like Netflix are likely to enter the market at some point. Indeed, thousands of South Africans already watch Netflix and similar services using clever technologies to circumvent region blocking. Piracy is also a growing threat. Although it’s not legal, BitTorrent makes it easy to download the latest television shows the moment they’re broadcast in the US. A growing number of South Africans do just that.

  • Duncan McLeod is editor of TechCentral. Find him on Twitter
  • This column was first published in the Sunday Times

10 Comments

  1. Vusumuzi Sibiya on

    >>preparing for the day when (it’s not a case of if) on-demand viewing eclipses traditional linear broadcasting.

    And that day is approaching faster than the E.L.E. (Extinction Level Event) from the movie Deep Impact.

    >>Time will tell which model — Altech’s or Times Media’s — will prove more appealing to South African consumers.

    I don’t see why it would have to be a case of one vs the other… Altech’s approach is the best for the foreseeable future and should be dominant for the next 5years. With that said, there are at least 48 other YouTube channels in ZA that exceed by far the monthly views of the top channels which I have that average 215K monthly views with the leading channel primarily targeting a Zulu understanding audience. Only 30% of the traffic is from mobile so the VIDI service definitely has potential.

    Altech is on a platform with an already size-able target audience having chosen to go with Sentech on the same satellite as DStv. The biggest broadcaster on the Sentech platform is the SABC and has the largest ZA broadcast audience reach. What needs to happen is; the proven most successful South African tri-partheid alliance masses influence approach, with the three parties Altech, Times Media & SABC bringing together the best which they have to offer as a united force for the benefit of the consumer.

    Times Media has their film division that has relationships that can negotiate the best deals to acquire good content, Altech has the best technology expertise and SABC has a massive audience that the alliance can market to; and have a solution that will have the public broadcaster well prepared for the E.L.E. day. VIDI can develop an Android app and piggy-back off the success that will be initially enjoyed on the Node and Times Media can contribute to marketing the alliance’s offering just as well as the SABC using all the marketing channels available and at the disposal of the alliance.

    If the ANC, SACP and COSATU can make it work with all the differences they have… there’e absolutely no reason for a tri-media alliance of these parties not to work and that will be most beneficial to the consumer given that Multichoice now has the upper hand thanks to the smart thinking of some Einsteins and their determination to have CA, as if it would somehow magically give them deep pockets to be able to buy rights to all the premium content they want.

  2. SABC should look and listen. SABC should come up with matching or even better services to survive.

  3. The Altech model is currently the best but there is little doubt that as broadband becomes more accessible streaming will become the norm, as it is in many overseas markets where Telecom companies offer a range of TV services as part of a package, What will severely impede Altech’s market penetration is the ridiculously high cost of the set top box, These should have been factored in to contract clients , much as cellphones currently are.

  4. Jip. R3499-00 plus a monthly fee of R299-00 is heavy. Then you still have to add bandwidth costs for Internet on your Node.

  5. Vusumuzi Sibiya on

    Your latest Samsung, Sony & Nokia Smart-phones (oh and iPhone from the store) come in at around double that price and the decent contract option on which most people get these is around R499-00.

    >>A contract option is also available through Altech Autopage, the group’s cellular service provider, allowing consumers to amortise the upfront cost of the set-top box over a 24-month period.

    These guys have more than done their research and this “price is heavy talk” reminds me of when Vodacom & MTN were starting out… didn’t take too long for those who were hating on people who stood holding a brick to their ears, talking loudly; to also join in on the fun.

  6. It depends
    – Content Library
    – What you get for the R299 – If you get unlimited viewing of the above Library THEN
    – Maybe people will cord cut and ditch DSTV

    Frankly I think it is too much in addition to DSTV
    UNLESS the catalog is brilliant

  7. Your points are well made and I agree with most however to even consider bringing the dysfunctional SABC into the picture spells, in my opinion, disaster.

  8. Not really. SABC should become a Service Provider. SABC should allow paying clients to broadcast on their new digital TV platform. That is why conditional access is important. 3rd Party content owners should be allowed to broadcast their premium content to all in SA.

  9. Vusumuzi Sibiya on

    Attempts by the SABC on it’s own to establish a 24/7 news channel have been nothing but a disaster in the past and now when working with a private company where the channel is commissioned by DStv you have a properly functioning 24/7 News Channel on DStv CH404.

    On the ZA top100 YouTube channels, both the eNCA and SABC News channels are amongst the Top20 with just 5 rankings separating the fast growing SABC News channel that averages 265K weekly views.

    All the cells in a fat caterpillar become dysfunctional as everything grinds to a halt and most die and numerous are discarded… that’s just the way it is when the time for tectonic change arrives. But then something happens supported by the forces of the universe; the remaining cells with a vision of the future that goes beyond extinction, transform themselves and emerge from the rot of the cocoon and fly-off in the form of a butterfly.

    The forces of the universe in this case may well be Altech and the Times Media Group with their vision for the future that will most definitely save the public broadcaster from peril.

  10. I think MultiChoice are seriously concerned about the effect VoD solutions are having on their profits. I see that they have just cut the option to suspend your account when ever you like and moved it to a monthly basis. Just turning DSTV when there was a show I wanted to watch was very convenient and who goes on holiday for month?

    I’ve seen this question posted a few times on DSTV’s Facebook page, but so far no reply.

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