The Killer App for the cable TV industry is: Peer-to-peer entertainment on demand using thick client PVR STBs.

Definitions:  

A PVR is a Personal Video Recorder, like Tivo and Replay/TV, which has a hard-drive and allows the user to stop live TV and replay previously recorded programs.  An STB is a Set-Top-Box usually provided by the cable TV provider. Thick-client as opposed to thin-client describes the robustness of the STB. A thick client is like a condensed PC that uses the TV monitor as a display.  It typically has a lot more memory, a USB or Firewire port, perhaps a hard-drive (needed for PVR), an audio output for connection to their home theater system, a better graphics card to convert Internet content into a presentable TV image, an S-Video output for a high quality screen presentation, a printer port, and along with more memory, the ability to store cookies and to run Java and plug-ins like Flash and Pulse as well as other Internet deliverable software.  MSO in the cable TV industry, means Multiple Service Operator (e.g. Cox, AOL Time Warner, Comcast, AT&T Broadband, Adelphia, etc.)

The Editorial:

If a MSO employs the peer-to-peer software on their thick client STBs, they can re-purpose their STB network and have the customer pay to pay for the electricity and for the rental of the server box (which can always be on) to serve entertainment content to other customers on their network. For example, if someone in Phoenix watches "Bonnie and Clyde," it gets pulled down the first time from the MSO's server, to their PVR STB and they watch it. If someone in Scottsdale orders "Bonnie and Clyde," shortly after, it can be served from the Phoenix consumer's home or from the main MSO server, depending upon how busy the network is.  This way the server load is distributed. The MSO gets to be the Napster for its own entertainment licensed catalog.  This is a huge money maker.  It will subsidize the roll-out of thick client STBs with PVRs.  MSOs will gladly obsolete their older thin client STBs to allow the customer to start ordering on demand movies over their system.

 

See the recent Red Herring's Sep. 1, 2001 issue article called "Peer Pressure" on page 62.  It shows a handful of software companies working on the video on demand peer-to-peer solution.

 

Magazines suggest that economic boom is based on the latest great idea.  When a bunch of great ideas happen at the same time, the economy thrives. Three years ago the group were the Palm Pilot, the Sony Playstation, Windows98, the DVD player and the compact cell phone. All of these were exciting and required great expenditures, which people gladly made for the new opportunities inherent in each.  In the last two years (in the USA) there has been nothing of interest. Hence, the downturn.

 

Replacing millions of STBs and leasing everyone a new thick STB to get on demand entertainment along with being able to stop live TV will make a lot of people excited.  This will qualify as one of the Great New Ideas needed to make the economy rebound.  Add a couple more, like the X-Box, Windows XP and somethings yet un-conceivable and we will be back in a boom cycle again.  It always happens. And it will be exciting, by definition.