With increased fragmentation of content rights and consumer viewing behaviour changing rapidly we provide insight in to the rights issues that IP owners and licensors are contending with.
What is a Network Personal Video Recorder?
nPVR is typically defined as the storage of content on the television service provider's servers (in the cloud) rather than in the hard disk (local storage) on the consumer’s set-top-box (STB). In most cases the utilisation of content via a nPVR requires an agreement between the operator and content owner as it has been deemed a ‘right’.
Why do operators want to launch it?
Historically content recorded by consumers has been stored on a Set Top Box (STB) hard drive, but nPVR removes the need for a hard drive in the STB - providing operators with reduced CAPEX and OPEX. It has also been used by operators to cost effectively enhance the users service and enable greater penetration of PVR functionality, and in some cases drives revenues directly through service charges or indirectly through higher tier service bundling.
Who has launched it?
We have seen limited deployments and mixed initiatives outside of the US. Channel owners have been resisting giving permission to operators (especially Free TV channels) and they themselves find it hard to get all the rights clearances they need from content owners. Generally the channels and content owners are seeking more assurances from operators over how the services operate and what business rules are in place. In some instances where launches do occur, there has been reliance on local copyright legislation (with different copyright regimes being much more supportive to operators, such as in Switzerland).
What is the licensing channel view?
As broadcast channels are often reliant on securing rights with their content providers it is necessary to look at the view of the content owners (those selling rights to the broadcast channels). The main objective of a content owner is to maximise the utilisation of their rights in order to gain revenues. As such, in order to protect any other revenues (sales to other services in other licensing windows) there is a reluctance to grant nPVR rights, unless financially compensated. Some content providers think that nPVR will impact negatively potential deals with SVOD providers. The logic being that cloud storage with an operator service has increased the consumers ability to binge content and therefore the value of that content to an SVOD provider is significantly reduced.
The 3Vision take
In some ways we see the failure of mass nPVR roll out by operators as a missed opportunity by content owners to control the recording of content on a STB. The cloud based element and ‘rights’ requirement of nPVR means that rules can be negotiated and written between operator and content owner on areas such as ‘number of storage hours’ and ‘storage duration’, but the reluctance to establish clear business rules has understandably hindered many. None of these rules can be set with content on a hard disk in a STB, and the potential for targeted advertising is also far greater with cloud based PVRs. It now may be too late for nPVR all together - content owners have become more generous in providing enhanced catch-up right offers, and therefore the need for consumers to plan and record is reduced with more on demand options to satisfy consumer demands. This may soften the operator demand for recording capabilities.
How can we help
We have vast experience in negotiating with content owners on behalf of operators for nPVR rights. If you are considering launching nPVR, we strongly advise that before investing in the technology element a full audit of the content available to you should be conduct.
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