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Lesson one: The opposite of detracting from total value is adding to the total value. Cable service providers can leverage next-generation interactivity, world-class content, deep personalization, and extraordinary self-service capabilities to build stronger and more profitable customer relationships. Bringing these factors together by aligning them with tru2way capabilities should produce a healthy ecosystem because it will layer on top of existing services in a way that adds to the total value of what is delivered to the customer.
Lesson two: CableLabs created the standards for hardware and software development that make tru2way a viable consumer technology. While CableLabs will offer inter-operability events for hardware and software developers, ultimately, the MSOs will need to specify their certification criteria for any tru2way application that will run over their network –whether developed in-house or by third parties. It is not a given that developers will come in droves to deliver tru2way applications. Cable service providers will need to make it attractive and not too painful for legitimate applications to make their way onto the network.
How to Make it Attractive
One of the keys to making the tru2way infrastructure attractive will be making it easy for third parties to monetize their services. Partner settlement capabilities and digital commerce certifications will be as important as the functional certifications of the set top middleware.
If tru2way is to give consumers a digital commerce experience, then the hygiene of digital commerce will need to be attended to. Service providers will need to have a unified product catalog and a unified view (a 360-degree view) of the customer. Consumers will want to be able to manage and view their account to do everything from review the status of their VOD spending to checking the status of their online gaming subscriptions and creating dynamic picture-in-picture layouts that will allow them to choose between online and linear content.
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The game-changer for cable companies could be personalization. |
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However, the game-changer for cable companies could be personalization. The value proposition of personalization is this: providing consumers with efficient access to relevant content, ads, and services will translate into tangible revenue growth for the service provider. The personal information that cable service providers have about their customers is significantly different than what their competitors know. Cable companies know how their customers like to be entertained and informed, how much time they will give to certain kinds of activity, and their preferred time slots for those activities. By tailoring the interactions between the customer and the enterprise, and addressing their unique needs by taking into consideration their intentions, habits, and preferences, the service providers will ensure relevance.
And relevance is perhaps the single most important criteria in attracting top advertising dollars. As cable company consortium Canoe Ventures folks have said, this “… is not only about making advertising more effective. Americans are watching more TV than ever, and we're accelerating its evolution by making it a more exciting, robust, and relevant platform for viewers, too.”
The benefits of personalization, whether derived from explicit choices the customer makes or the implicit recommendations and choices of the artificial intelligence engines running behind the scenes, will lead to increased ARPU, decreased churn, and improved ad revenues.
The cable industry sits amidst a competitive landscape unlike any it has ever known. The number of true competitors with formidable capabilities, capitalization, and ambition is growing. By maintaining a focus on the customer experience and the changing behavior that defines it, cable service providers can leverage this next generation of interactive technologies to change the game again.
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