German cable company Kabel BW has become the first cable operator in the market to provide true video-on-demand (VoD) services delivered via its cable network to the set-top box. The VoD library will initially be available only to HD customers; however an update will be rolled out to other digital receivers enabling them for VoD within a matter of weeks. The service, branded as Kabel BW Videothek, will concentrate on movies at launch, with HD versions available from the start. Movies will be priced between €1.99 for library titles and €4.99 for the latest blockbusters.
Most of the major Western European cable companies have already launched video-on-demand services; however the German cable companies have fallen behind in this respect. The structure of the German cable market, with the physical separation of the last-mile 'Level 4' operators and the 'Level 3' backbone network owners and content suppliers, has resulted in a slow upgrade to the cable networks, stymieing digital TV, cable internet and telephony and advanced services roll-out to consumer premises.
Around two-thirds of Kabel BW's 100,000 HD customers will be able to receive the service at launch. By the end of 2011, we estimate Kabel BW Videothek will be available in 1m households - on the assumption that 60-70 per cent of its 1.4m digital subs will have a broadband internet connection.
Kabel BW's VoD offering is a relatively basic service by international standards, with none of the catch-up TV content which has made VoD so popular on US and other European cable and IPTV systems. This popularity implies that inclusion of such content is likely to be only a matter of time, however, and the launch of VoD will be welcomed by consumers and content providers alike.
One feature of Kabel BW's VoD service is the fact that although VoD is streamed via the core cable network into the set-top, control signals (i.e. fastforward, pause, rewind) are carried via broadband. Initially, the VoD service will require a Kabel BW internet subscription, but longer term, the company plans to allow any internet subscription to be used to carry the control signals. This usage of the open internet for control signals potentially paves the way for an easy introduction of mobile or tablet apps to control the VoD service.
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