As some had speculated or feared, AT&T’s purchase of DirecTV is leading to a major change in video entertainment delivery, away from linear service based on the fixed network, away from satellite delivery, and towards streaming.
There are all kinds of implications. Not the least of the advantages are operating cost reductions. “The biggest cost we have it that is so to speak, the truck role and getting that installation out,” said John Stephens, AT&T CFO. So AT&T has been testing a self-install decoder “called Osprey,” which is a “self-installed, full linear product.”
So “the only truck roll is the UPS truck,” he quipped. “It dramatically reduces our install cost; dramatically reduces our subscriber acquisition costs.”
So the standard linear video product shifts from U-verse to DirecTV to DirecTV Now, using a self-install decoder and “bring your own broadband.”
The Osprey is said to be an Android-TV-powered streaming player that will offer the same linear service contracts and channels but without the use of a satellite dish.
That deployment model keeps DirecTV’s national footprint, but shifts the platform to streaming. In principle, that also gives AT&T more options about how to upgrade internet access bandwidth inside its fixed network footprint.
The shift to streaming eliminates the need for a dedicated linear video network. By unbundling access and app, AT&T also gains the ability to use any access platform (its own, or others) to support linear streaming video. Where U-verse video segregates linear video from internet access, the streaming platform shares the access pipe.
Oddly enough, AT&T might have to provision less bandwidth for linear streaming than for U-verse video, as U-verse video used separate logical networks over the same access cable.
As was the case for cable TV operators migrating from analog video to digital video, one important advantage was that additional bandwidth was freed up for internet access purposes.
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