Aereo and DTV Apps

Interesting look at Aereo and the Dyle and MyDTV apps could undercut the growth and adoption of Aereo.

Aereo plans to roll out to 22 cities soon but if you just need the Dyle and MyDTV apps to pick up the same channels - doesn't that greatly undercut the Aereo value proposition? Right now the apps are free but even if they were priced at just the cost of a single month of Aereo service - say $8 - then it still represents a great value.

My guess is that in the future cell carriers will put together packages with apps like Dyle and MyDTV coupled with an OTT service like Netflix or Amazon Prime. Think about a company like Verizon Wireless and what they could do with a couple apps like Dyle and MyDTV coupled with their new Redbox Instant service. An almost perfect combination.

Makes sense.

Why Netflix Might Be an Attractive Target

Very interesting report that Netflix now accounts for 33% of the residential downstream peak traffic in North America. Nobody else is even close.

I speculated that one of the reasons that Verizon may have started the joint venture with Redbox was to insure that whenever possible the Redbox Instant traffic would be traveling on Verizon pipes. What would 33% of the peak residential traffic in North America be worth to Verizon? Would wrapping up that traffic and the revenue that it entails be worth a little north of $4 billion (what it would probably take to buy Netflix)?

I've seen a lot of articles talking about who would be interested in actually buying Netflix and all of them name the same usual suspects - Amazon, Verizon, Google, AT&T but I think there could be others for whom the purchase might make more sense.

Think of a company like Level 3 Communications. They could buy Neflix and tell Reed Hastings to just keep running the company as he has done with one little stipulation - all traffic on Level 3 pipes whenever possible. In turn Level 3 could increase Netflix's profitability just by making network usage more efficient.

Or think of a company like Akamai. They could also drive profits by making Netflix's network usage more efficient while at the same time using Netflix's traffic to get better deals for existing CDN business. It would be a very bold move by Akamai but it very well could be worth it.

If Netflix does get purchased - I'm guessing it won't be by one of the usual suspects (except maybe Verizon).

Redbox-Verizon Streaming By End of Year?

Interesting article updating the Verizon-Redbox co-owned Redbox Instant product.

One flaw that I would say exists about the article is that it never even mentions the Dish Network owned Blockbuster  at Home product. With over 14 million subscribers to Dish Network and with over 25,000 titles in their Blockbuster at Home library (of which over 10,000 are available for streaming) - it seems silly to overlook this potential rival to Netflix, Amazon and Redbox Instant. In fact - if Redbox Instant grew to just the current size of Blockbuster at Home it would be viewed as a wild success.

Edit: Please note that Blogspot does not allow the "at" symbol. That's why Blockbuster at Home is spelled the way it is.

Redbox Instant by Verizon

When you think of it the Redbox Instant by Verizon product is genius. The child of a joint venture between Verizon and Coinstar's Redbox - the service plays off the strengths of both companies. Verizon handles most of the bandwidth traffic requirements (like a free CDN for Redbox) while Redbox handles the content rights which will pretty much be same movies you'll find on Amazon, Netflix or iTunes. Want a newer DVD release? You can try one of the Redbox kiosks - a wrinkle you won't find from any of the competing services.

Redbox enhances their existing offering with this service and Verizon adds traffic to their existing network. Win-win. The genius part is neither company is responsible for the last mile or wireless connectivity - the two areas where most of the customer issues will reside. Even if the customer is using Verizon DSL or Verizon Wireless - hey that's a different division!

Peter Kafka has a nice take on the new offering.