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Over-the-Top Video Finds Unlikely Friends

Video delivered over the Internet is a truly disruptive force. As cable providers improve their PC video offerings, satellite and telco operators increasingly see over-the-top broadband video delivery as a viable option.

During the past year, both DirecTV and DISH Network have rolled out over-the-top Video on Demand (VoD) on Internet-connected set-top boxes, while telcos in Europe have been combining digital terrestrial linear TV broadcasts with broadband video for VoD.

ABI Research believes that as broadband video offerings increase in quality and become more seamless, carriers could be significant players in the over-the-top video delivery market.

"Carrier-packaged over-the-top video delivery is a reality today in most markets," says research director Michael Wolf of ABI Research.

The fact is, broadband video is a way for some carriers to fill holes relative to larger closed-network operators such as cable MSOs, and over time more satellite, telco and European terrestrial operators will utilize broadband video delivery as a component of their overall offering.

The 2Wire release of a carrier-targeted broadband video delivery set-top box is a sign that hardware manufacturers are also seeing a growth opportunity in this market.

At the same time, cable operators such as Comcast are looking for ways to package broadband video to the PC in an effort to combat potential growing interest in free ad-supported video delivery from portals.

"Comcast's early interest in being a Hulu syndication partner with its Fancast portal shows how MSOs are also interested in utilizing online video," notes Wolf.

While some U.S. cable MSOs will ultimately take a defensive stance using bandwidth caps or other measures, some also see a threat in offering nothing to their own customers in a world where free, ad-supported prime-time content is available to consumers via their PCs.

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