Comcast's Streampix subscription VOD (SVOD) service launched in February 2012, is to be downsized and folded in Comcast’s existing VOD offering. News comes as Comcast began roll-out of its X1 DVR with cloud technology in the San Francisco Bay Area and Houston, and updated it to provide streaming of cloud DVR content while out of the home across the whole cloud DVR footprint.
The Streampix dedicated app and website will be decommissioned, although the Streampix name will continue as a separate free network within Comcast’s vast VOD library. In a document filed with the FCC regarding its Time Warner Cable merger, Comcast cited minimal consumer interest in the service. As a result, Streampix will no longer be offered to broadband-only customers as a separate standalone SVOD service for $4.99 a month, but it will still be a standalone service for video customers.
At the same time, another pay TV SVOD service is failing to gain traction and momentum. Redbox Instant, a Netflix competitor, provided by Verizon and Redbox has seen under whelming subscriber uptake, with Redbox executives stating they were not pleased where subscribers were at. To make matters worse, Redbox Instant, which is not exclusive to Verizon FiOS customers but open to anyone, has ceased to accept new customers in the past three months due to credit-card fraud issues.
While Comcast’s SVOD offering is put on the back burner, its Comcast’s X1 DVR with cloud technology continues to be its main focus and showcase. It is gaining greater traction and was already available in 31% of Comcast’s footprint as of Q2 2014, according to its earnings call. It is on track to become the heart of Comcast’s TV Everywhere strategy. It provides live streaming of all its channels in-home, and in the case of X1 cloud customers, the ability to download DVR content to mobile device for offline viewing, and streaming DVR content anywhere. The DVR download and streaming functionality is only matched by DISH and DIRECTV.
It comes as no great surprise that Comcast's customers are less than enthusiastic to pony up an extra $4.99 per month on top of already high subscription fees. In fact it seems that Comcast is conceding victory to Netflix. It likely thought that existing video subscribers would flock to Streampix because it was a lower priced alternative which boasted a ready connection to the main TV set in the house.
Unfortunately for Comcast, Streampix didn't stream enough quality pix to become a viable proposition for most customers. The business of SVOD seems dominated by Netflix who has been aggressively making deals for exclusive content, something which other SVOD services have been less successful at. For other SVOD services like Redbox Instant, the dearth of original content may be a key factor in the lack of success, and given its recent security problems, its long term viability is in question.
While SVOD hasn't been a resounding success for Comcast, TV Everywhere and it's X1 DVR have amply filled the gap. By combining the ability to stream DVR content out of the home for X1 Cloud DVR customers, Comcast has upped the TV Everywhere game again. IHS believes that recent quarterly victories for the company have been directly related to the combination of advances in TV Everywhere, X1 DVR service, deep promotional pricing, and unique bundles.
When Cablevision set the nDVR precedent no one could have predicted the effect that it would have on the industry. Now more than six years later the business of pay TV is becoming more than a TV proposition, and will likely rely upon second screen viewing for the success of its video business in the mid to long term future