As the 2015 CES conference fades (already!) in the industry’s rear view mirror, it’s worth recognizing how much occurs during CES week, but not at CES itself. Apple famously casts its long shadow each year, since Apple products are surrounded by a large halo of aftermarket offerings, but Apple (the company) had no overt presence in Las Vegas that week. But another company of similar stature does: AT&T, which begins its annual Developer Summit with a Hackathon during the weekend prior and concludes it with a conference, consisting of a keynote and breakout sessions on the Monday just prior to the CES opening day.
“Mobile is eating the world!”
The 2015 AT&T Developer Summit, in its ninth year, had 4,000 developers in attendance. For the Hackathon, the attendees broke up into groups to create apps that followed the decidedly “mobile” themes of the event: mobile apps, the ‘Internet of Things’ (including smart homes and the Connected Car), WebRTC, atop the software-defined network (SDN) and network function virtualization (NFV). SDN and NFV are about defining the resources you want in your applications, and making sure that the network can provide them on demand.
The conference keynote was opened by AT&T Mobile and Business Solutions President and CEO Ralph de la Vega, who exclaimed that “Mobile is eating the world!” (riffing on the famous 2011 “Software is eating the world” article, about how old-school hardware companies like HP are turning toward software to help ensure their futures). Mr. de la Vega then explained how the combination of software, mobility, the cloud and security have already disrupted many industries, changing the way consumers live and work by creating ecosystems that connect secure end points to a secure VPN. Uber is the obvious example.
If it’s not networked, it’s dumb
In an ‘Internet of Things’ (IoT) panel later in the keynote session, Glenn Lurie, now CEO of AT&T Mobility, elaborated that “Any device that’s connected is smart, and if it’s not connected, it’s dumb,” and that AT&T’s goal in the IoT space is to connect to any kind of device or customer, whether it’s an individual or a city; a network of street lights, or a consumer’s automobile or smart watch. With that context in mind, Mr Lurie’s panel had a wide-ranging discussion.
Panelist Steve Mollenkopf, CEO of Qualcomm, unsurprisingly believes that a fundamental quality of IoT will be mobility. Benedict Evans of the investment firm Andreessen Horowitz believes that IoT will be a bigger opportunity than mobility, the PC, and software. Cisco’s Chief Technology and Strategy Officer, Padmasree Warrior, said that now that it is in place, is commerce-enabled and is social, IoT is the next logical step in the evolution of the Internet. Alex Hawkinson, CEO of SmartThings, a ‘smart home’ technology company, added that the key to IoT is to make devices and use-cases simple, accessible, easy to use, and to be sufficiently open to enable walled gardens that provide opportunities for innovation.
The panelists agreed that there is no single unified trend in IoT because it’s so diverse. The most interesting things will happen at the edges of networks, but the availability of connectivity and bandwidth will limit how much ongoing communications will take place, and therefore, how much of the experience will actually need to be available within a given device if the connection can’t be guaranteed. There must be a balance between them to best leverage both. Devices will become so cheap and so useful that they will be everywhere, but they will need software and networks to enable the use-cases.
Smart Homes and IoT are the next frontiers
A September 2014 Goldman Sachs report quotes the Consumer Electronics Association as saying that only 10% of new homes current have home automation. To drive adoption, the panelists said that greater awareness must be created that home solutions exist in the first place. Another driver will be a combination of openness and a consolidation of standards, because consumers will not want to have to decide which walled garden they want to be a part of. It’s up to the developer community to enable use cases regardless of device and network. [ My comment: in the adjacent Connected Car space, some car companies are already planning to enable consumers to bring either Android or iOS into the car, and not force that choice on the consumer. ]
Security was another area of discussion. Last September, a Hewlett-Packard report said that 70% of IoT devices lack security. In order to accommodate security, several things will need to change. First, security must become appropriate to the use-case, and less of a ‘point product.’ For example, DRM for video and data security for health care applications are very different. Yet, an AT&T consumer might have the need for both within the same account relationship. Also, there is already a simultaneous need for security and privacy: data is collected about a device user, but it must be kept anonymous – often for regulatory reasons. In all, the Internet will be called upon to enable an increasingly diverse and personalized experience. There will be more end-points, so the architectures of networked applications and devices will have to accommodate that. There must be distributed intelligence that functions in realtime and, from moment to moment, recognizes that an end user’s device or data may be vulnerable to attack, and decides when to implement security from the cloud and when to invoke it local to a device.
“Hundreds of electric motors”
Andreessen’s Evans noted that “you have hundreds of electric motors in your home, but you didn’t set out to buy these electric motors. Instead, you bought refrigerators and mixers and applienaces and all of them have use-cases. So developers need to respect these accepted use-cases.” Ms. Warrior from Cisco elaborated, saying: “There is a lot of value in connected IoT devices and developers must expose that value. They must make them more efficient, which is where analytics comes in.”
Another issue is one of ‘certification.’ Many devices will be retrofitted into connected applications that have never been connected before. Who will use the technologies? Who will enable them? Are they capable and qualified for use? Developers must ask themselves: “how will we make it easy for applications to happen, and how do we make them easy to use?”
This discussion seemed rather remote from AT&T, but the opposite is true, since AT&T already offers a home security and home control service (AT&T Digital Life) and is trying to drive adoption against entrenched competition like ADT. In addition to AT&T’s strategic initiatives into the Connected Car, where AT&T offers a global automotive telematics platform in partnership with in-country communications carriers in virtually every market where automobiles are sold. AT&T’s NetBond platform provides APIs that enable developers and enterprises to create virtualized applications that integrate AT&T’s network with cloud partners that include SoftLayer, CSC, Amazon Web Services, VMWare, IBM and Microsoft Azure.
But this was a Hackathon – what happened?
Developers participating in the Hackathon had 48 hours to put together apps using the AT&T network platforms and APIs. Many teams formed, from which 20 teams were selected for further evaluation by AT&T, which eventually resulted in three finalists. The winning team won $25,000, and was presented with a check on the spot.
Anti-Snoozer, the winning app, utilized AT&T’s Drive APIs, a camera, and motion-sensing to monitor the driver’s position and the dilation of the driver’s pupils to sound an alarm to awaken a drowsy driver (presumably, for long enough to find a place to pull over or stay).
The other apps both used Web RTC to establish a realtime video conference between a user and a business via Web sites, using AT&T Web RTC APIs. “Sitter” is for care-givers in the home. It enables a parent to advertise for care givers. The applicant can record a personal video interview for the parent via a Web site. When the selected sitter gets to the home, the app connects to AT&T Digital Life, to enable or block access to rooms in the house, as enabled by the parent. “Host Magic” was for a home owner renting a property. Potential renters sign up, and the property owner receives an email notification that there is an applicant waiting. Similar to ‘Sitter,” the property owner can interview the applicant and grant access only to desired parts of the property.
The meaning of it all
Telcos will win the long-term battle of communications, because they place the network itself at the center of their business, not the delivery of paid content – as cable companies do. In other words, AT&T’s product is its network, and it is AT&T’s strategic interest to rally as many developers around it as possible. Just as Apple began doing in 1990 with its Worldwide Developers Conference (WWDC), and Microsoft with its Professional Developers Conference (PDC) in 1992.
The International Consumer Electronics Show (CES) in Las Vegas sets the stage for each new year, and the 2015 edition was no exception. Once largely about home audio, TVs, and car stereo, CES has evolved into a must-attend event for every stakeholder in the digital content value chain; from content creation to the point of consumption and every stage in between. Hence, most of the TV service delivery infrastructure players either had booths on the trade show floor, had suites in the nearby hotels, or did both; and most pay TV operators were there as well.
It must be a huge challenge for the Consumer Electronics Association to select winners of the CES Innovation Awards each year, and being ‘just one guy,’ I won’t even pretend to emulate this task. But I found three items during CES to be especially noteworthy – and taken together, emblematic of the larger trend of platform and service virtualization.
Of great significance is DISH Network‘s continuing evolution as an alternative kind of ‘TV Everywhere’ provider. By launching Sling TV, DISH has both elevated the expectations of what online TV should be, and while it isn’t perfect, has deliberately moved to address the demographic that the pay TV industry is the most concerned about losing: millennials. In my opinion, DISH has been the most forward-thinking of the US pay TV operators in the area of online TV. DISH also announced a new user experience, a track-pad-based TV remote control with speech recognition and a new 4K Joey client set-top box for its Hopper with Sling home media center. DISH’s sibling company EchoStar used CES for the US launch of a new home security and home control offering called SAGE, which EchoStar also demonstrated a few months back at IBC.
Also noteworthy was cable operator Charter Communications‘ new WorldBox set-top box, Spectrum EPG and user experience. Unlike the direction being taken by other Tier-1 cable operators, and in particular with the RDK, where the adopters must have RDK-specific set-top boxes and must upgrade their networks to all-IP distribution in order to realize the full potential, Charter has partnered with Cisco and Active Video Networks to introduce an experience that can be deployed to decade-old set-top boxes as well as new IP video-capable ones. Yet, at the same time, it’s a multiscreen solution. Further details are in my article for CED Magazine.
But to me, the highlight of CES wasn’t at CES itself, but rather, was AT&T’s 2015 Developer Summit and Hackathon at the nearby Palms Resort in Las Vegas. While most pay TV operators advance their features in carefully controlled increments, AT&T offers APIs that allow it to essentially open-source its entire network, and has invited developers of all kinds to play in their sandbox. By doing so, AT&T is providing keys to the kingdom to any developer that helps drive traffic over the AT&T network. While other pay TV operators are taking their first steps into home security and home control, AT&T has not only opened AT&T Digital Life (not to mention its AT&T U-verse pay TV platform) to third party developers, but enables development for mobility, connected vehicles, wearables, and the industrial ‘Internet of Things.’ And a host of partnered developers were there in support.
DISH, AT&T and Charter are each “coloring outside the lines” of conventional wisdom, and I’ll be writing more about each of them in the coming week.
Over the weekend, AT&T announced its intentions to acquire satellite TV operator DirecTV. Should the deal pass regulatory muster and go through, it will create an operator with about 26 million pay TV subscribers, plus 17 million broadband subs, 11 million phone subscribers and 100 million wireless customers. As a merged entity, AT&T becomes a national pay TV provider, with immediate access to TV subscribers outside its fixed-line (U-verse) territory. That’s just in North America. DirecTV has about 18 million TV subs in Latin America as well. All told, this would make AT&T the largest pay TV provider in the US (and in the Western Hemisphere).
Of course, DirecTV is a high-value target for content reasons as well: particularly its exclusivity for NFL Sunday Ticket. Some major AT&T suppliers must also be taking notice. For one, AT&T has based its TV service on Microsoft Mediaroom, which Ericsson bought last year. DirecTV uses NDS TV security and middleware, and NDS is now owned by Cisco. So, two TV infrastructure leaders that also both happen to be incumbent network suppliers to AT&T.
But there’s also a bigger picture: while a combined Comcast-TWC results in a triple-play provider, DirecTV adds to AT&T’s existing quad-play advantage. Without offerings that compete against AT&T wireless and DirecTV, Comcast will remain a local carrier within its own cable TV service territory; even with Time Warner Cable. To serve any devices – mobile or fixed – outside of its territory, Comcast will remain an OTT player. (Note: TWC is partnered with Verizon Wireless – but it’s anyone’s guess as to how Verizon might treat ‘foreign’ video providers over its mobile network in the future).
The expiration of Net Neutrality was certainly a strategic consideration for both AT&T and Comcast. One of AT&T’s terms in the proposed DirecTV acquisition is to place a three-year expiration date on its commitment to the FCC’s current version of Net Neutrality. This is interesting, given that DirecTV is a satellite operator with no Internet access network of its own. My own guess is that this is really a pre-emptive move to keep Comcast from having (or making Comcast pay for) equal access to AT&T mobile subscribers; for video delivered to smartphones, tablets or the Connected Car.
And Comcast doesn’t really have an answer to that. Even if Comcast were to let its own Net Neutrality commitment expire in 2018 (which is the year specified in the terms for its NBC Universal acquisition), that will only be within Comcast’s own network. Comcast would have little power over mobile carriers which, by then, will be perfectly able to parachute right into the thick of Comcast territory, to deliver high quality pay TV over LTE mobile access. This places Comcast at the ultimate disadvantage, even with TWC, because it can’t do the same in a U-verse territory. All the more reason to keep Net Neutrality principles in place.
By missing out on DirecTV now, and by not bidding for Sprint last year, Comcast missed two strategic opportunities to reach subscribers that don’t depend on fixed lines, at a time when mobility arguably represents the biggest single opportunity in telecom. Not quite so much to see here after all.
But the competition will really get interesting when DISH finally launches a national LTE service, using all that spectrum that they’ve acquired in recent years. Or, even more interesting if DISH were to acquire T-Mobile as well.
This past week, Apple announced CarPlay, a rebranding of its iOS in the Car initiative that was announced at its June 2013 Worldwide Developers Conference. My own answer to the question I pose in the title above is at the end of this article.
Having been around the IP video and IPTV world for almost a decade and a half, I can recall how many times the IPTV plane was on the runway and seemed poised for takeoff. I remember writing an article in January of 2002 for Cable & Satellite International, titled “TV over Copper: Is 2002 the year?” With 20:20 hindsight, no it wasn’t.
By then, a lot of Telcos had already launched TV-over-DSL services to paying subscribers, going back to Canada’s Aliant and Kingston Interactive Television in the UK in the late 1990s, followed by Livingston (TX) Telephone and the UK’s Video Networks Ltd (and other pioneering independent operators) by the end of 2000. By 2005, there were hundreds.
The real turning point was when the large incumbent Telcos were able to reach scale. In the US, it was when AT&T and Verizon began to deploy their respective U-Verse TV and FiOS TV services at the end of 2005. In France, it was France Telecom’s MaLigne TV, along with a group of broadband competitors offering hybrid IP-satellite TV. In Hong Kong, PCCW’s Now TV had reached 750,000 by the end of 2006, and was the world’s largest IPTV provider for several years. In 2009, PCCW hit a million subscribers and had about 1/3 of the Hong Kong pay TV market.
My 2002 article was all about the transition to IP from Asynchronous Transfer Mode. In other words, it was about the network. But a lot of other tumblers had to fall into place before the real potential of IPTV could be unlocked: set-top boxes, middleware, MPEG encoding, standardized network architectures, content security, best practices for video quality assurance, and much more; not to mention the content itself. Each time one of the tumblers clicked, we all thought we were on our way.
It’s tempting for people watching the auto industry’s steady progress to fall into the same trap. After all, Apple is in this now, so the Connected Car category must be mature. But that’s still far from true. Consider some of the early adopters. One was Ford’s Sync, based on Microsoft Windows Automotive Embedded technology. The conventional wisdom in 2009 being that Microsoft, of course, was going to own the Connected Car (just as they “owned” IPTV between about 2005 and 2010, which was arguable because AT&T was by far the largest single customer. Most of the others were small and some never deployed).
But Microsoft followed success with surrender and exited the IPTV space in 2013 by selling its Mediaroom unit to Ericsson, which will certainly transition the 45 or so Telcos using that platform over to something a little more Ericsson in nature, in the long run. So it’s natural to question Microsoft’s situation with Ford, given that Ford has recently been in the news with both Google and Apple.
On the heels of Apple’s CarPlay announcement, 9to5 Mac ran an article that asked “Will CarPlay impact your next car purchase?” And consumers weighed in with some obvious comments “Most cars already have a touch screen, so (why not buy one that integrates) with my main device.” and “Will Apple … have updates?,” “I’m sure there are safety concerns,” and “All I need on the dash is heater/AC and an AM/FM radio…” One technology-informed responder said “…(because) it relies on Blackberry’s QNX underpinnings … I can just schlep down to Best Buy… and pick the car stereo of my choice, as long as it uses QNX.”
Each of the concerns make valid points: compatibility, usability, relevance, not going out of date. It’s also not hard to envision the average car buyer wanting to choose the mobile OS that they already live with, just as they do for exterior paint and interior upholstry.
QNX happens to enable the virtualization of client operating systems, so a single QNX-based IVI system can conceivably host iOS, Android and Windows Embedded for Automotive. Linux-based operating systems like QNX or GENIVI (or even techology initiatives like MirrorLink) can enable auto OEMs and aftermarket suppliers to create an OS-neutral environment. But none of the car companies offer anything close to that yet to consumers, and automotive product lifecycles are (ahem) a lot longer than software lifecycles.
Another piece of the ecosystem is wide area connectivity. The Connected Car has been a strategic initiative for a number of major Telcos in Europe, Asia and the US, which has made it one for their network suppliers as well. iPhone reseller AT&T has a compelling vision for the Connected Car, and already enables application developers to leverage APIs into services that include U-verse TV, smart home, location awareness, mobile messaging, and mobile payments.
This January, AT&T announced its AT&T Drive connected car developer platform during its Global Developer Summit in Las Vegas, which coincides with CES. Soon afterward, AT&T opened its AT&T Drive Studio at its Atlanta GA Developer Foundry facility. AT&T also partners with GM (which is embedding 4G LTE capability in all its cars by the end of this model year, and is sure to help address the need for in-vehicle software updates).
So, will CarPlay really be the catalyst to bring the Connected Car into the mainstream? In a word, no. A significant step, maybe: along with Siri Eyes Free, which is available in some Chevy vehicles, it may represent a mainstreaming point for the in-vehicle user experience. But the Connected Car is an ecosystem and the possibility that AT&T, GM and Apple might be working alongside one another toward the same goals (even if not together), is a show of category maturity.
Once again, just as it was with IPTV a decade ago, a lot of tumblers must click into place, and no single party is in control of all the tumblers, except arguably the car companies, which are the most conservative actors in the entire initiative.
Note: Steve Hawley will be conducting a conference session on the Connected Car at the 2014 TV Connect conference in London, which takes place from March 18 to March 20.
Here’s wishing my readers a happy and prosperous 2014! Strap in – 2014 promises to be a great ride.
It’s a bit late for Happy New Year, but a week at CES provides a good excuse. Over the next week, I’ll be presenting my CES experience here.
2014 CES highlights included:
- AT&T ‘s 2014 Developer Summit!
- The 2014 Consumer Telematics Show, all about the Connected Car!
- New TV software, with features that might actually be useful!
- The battle of the Whole Home TV giants!
- Giant curved TV sets!
And much much more.
Microsoft CEO Steve Ballmer announced his retirement last week, leading to two immediate questions: “What happens next?” and “Who will succeed him?” In answer to the first question, the company would do well to quickly re-evaluate and re-rationalize its entire product strategy and portfolio. Microsoft has the ingredients for greatness but execution hasn’t been great in recent years. As for who should succeed him, Microsoft needs someone with the mind of a Jeff Bezos or a Ralph de la Vega, not a Meg Whitman or a John Sculley.
At CES 2013, Cisco held an event which included demos of Cox Communications new Cisco video gateway, a Cox TV app on the iPad, and a new EPG. DISH Network launched a new version of its Hopper whole home DVR and AT&T held its 2013 Developer Summit. Read the rest of the article on Telecompetitor…
In this “Part 2” article about the AT&T 2012 Consumer Industry Analyst Conference, we look at AT&T’s forthcoming Digital Life home automation and home control offerings, several other connected consumer market initiatives, and provide a peek toward AT&T’s larger game plan. Read the rest of this post on Telecompetitor.
AT&T recently hosted its 2012 Consumer Industry Analyst Conference in Atlanta, the company’s first such event. Attendees received updates on the latest AT&T services and devices, including its U-verse TV IPTV service. AT&T also briefed us about several recently-announced “beyond TV” service initiatives – some of which are poised to launch during 2013 – as well as a peek into the near future. Read the entire article on Telecompetitor….
AT&T announced additional second-screen and social features for its U-verse IPTV service a couple of weeks ago. Judge for yourself whether its U-verse App is an increasingly handy virtual Swiss Army Knife of sorts or whether it might instead be bordering on bloatware…