Talk to your Neighbors and Grow Your Video Business

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If you are looking for a way to add to your video customer base you might want to look towards your neighbors. Speaking at the Annual Innovative Systems Customer Video Meeting, CNS Video Product Partner Jean Edhlund commented on a somewhat unknown ability for Video Operators to offer their App-based streaming service to other communication companies. In a typical scenario according to Edhlund, Company A who has a streaming video service can offer that service to Company B. The reason for interest could be to offer a video service to bring more value to Company B’s broadband in a competitive market, or as a way to reduce expenses that they are incurring offering video on their own.

Melanie McMullen, Partner from the well-known cable, broadband, and telecom law firm of Cinnamon Mueller, cautioned, however, that most programming agreements limit distribution rights to the operator’s own customers and prohibit reselling the content to another provider, thus the manner in which the relationship between Company A and Company B is structured matters. As she described it, Company B leases capacity and acts as an agent for Company A, but Company A must be the provider of record. It “owns” the customers, meaning that it must have its own franchise authority in Company B’s territory and must distribute the content and report the subscribers under its own distribution agreements. She said her firm has assisted numerous video providers with these arrangements for many years and reiterated the importance of operators understanding the rights that have, and have not, been given to them in their programming and retransmission consent agreements, as well as any applicable last-mile ownership rules if they are a member of a purchasing cooperative or other content aggregator. McMullen and Edhlund both stated that the content must not be offered over the open internet, but only available within an operators’ managed network.

If you choose to offer your ABR streaming video service via a “Company B” system under this type of arrangement, McMullen said the legal fees involved are significantly less than those incurred by a new video operator who requires contract review and counsel regarding channel lineups, tiering and channel positioning, as well as negotiation of direct retransmission consent and satellite programming agreements.

From a technical perspective size matters, and if the company receiving the service has a large number of customers, edge equipment like that provided by Innovative Systems including the InnoStream and InnoCoder platforms will make it a better customer experience for services like Restart TV and cDVR.

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