Bo Ferm, director of product management for Verimatrix, provider of software-based content security and revenue enhancement technologies for pay-TV network, discusses the issue of staying competitive in a crowded pay-TV market.

Without a doubt pay-TV is evolving: a rapidly-growing IPTV market, the ability to pause and rewind live TV, and the emergence of alternative viewing screens like PCs, PDAs and mobile phones. Whilst the new delivery models offer significantly improved choice, it is the core content (and content-related services) that remain the key drivers for consumer adoption. Those service providers that remain focused on delivering compelling content, along with flexible options for consumption, will dominate the market in the long term.
Gaining access to that content and delivering it to the end user, in an increasingly complex environment, is wholly reliant on an effective and efficient content security platform. Operators need to ensure content owners’ rights are robustly and seamlessly protected across all platforms - from the traditional television to alternative screen-based devices including PCs and handhelds. Without demonstrating adequate provision for content protection, operators are unlikely to secure distribution deals and ultimately, attract and retain customers.
Content security strategies need to take account of the basic network configuration, the access devices being used and the specific requirements of content owners. The solution must be both flexible and robust for each of these considerations. This continually evolving landscape is ideally suited to a software-based solution that incorporates encryption, conditional access (CA), digital rights management and forensic watermarking technologies. Effectively securing content enhances the end user experience by ensuring the widest variety of content can be accessed on the end user’s platform of choice.

Benefits of IP
Traditional pay-TV networks are inherently based on a one-way broadcast method, meaning content is broadcast without a return channel. If someone tampers with a set-top box intending to disable the content security, the operator cannot detect it. Professional piracy or theft of service can occur on a massive scale resulting in a decline in paying subscribers and hence a loss of revenue and profitability. This type of endemic behaviour creates doubt in the minds of content owners regarding the effectiveness of the operator’s content security system. Not only can this cause revenue loss, it can mean the loss of content licensing, the very foundation on which a pay-TV business is built. On the other hand, IP-based pay-TV networks benefit from new ways to protect content from unauthorised usage. In two-way networks, which feature a return channel, content security solutions authorise devices to receive content only if they are deemed legitimate to help keep the network piracy-free.
A software-based IP content security solution brings real cost and security advantages to operators, especially compared with legacy conditional access (CA) systems. When paired with two-way networks, software-based solutions can be layered to detect or prevent different piracy techniques. For example, clone detection technology can determine if perfectly cloned receivers are stealing services from the network. Forensic watermarking technology embeds a unique user ID in the digital content in order to trace back pirated copies to the user and not just the operator. A robust watermark will survive a wide range of video content manipulations.
Moreover with software-based, downloadable content security, the receiver code can be renewed without a card swap, preventing revenue loss already at even attempted piracy.

Enabling new business models
An example of an innovative content delivery model on a two-way network is the rich interactive programme guide that not only provides information on what is on now or later - but what was on earlier that subscribers may have not recorded. The ability to start a programme over on a network digital video recorder (nDVR) is highly desirable for both the consumer and operator. It creates a valuable ‘stickiness’ factor that reduces subscribers churn and paves the way for value-added services. Content security can be handled very efficiently for IP-based nDVR services because storage of content and decryption keys is kept separate. Not only does this provide a more secure environment, the service operator remains in full control of the business rules. Services like this delivered over IP-based networks have the potential to achieve much higher ARPU compared to one-way networks.

Looking ahead: Competitive advantages
The two-way network approach is now being adopted by satellite and terrestrial operators by combining broadcasting with broadband in hybrid DVB-IP receivers. Operators can thus deploy two-way content security since the IP-based network provides the return channel while enabling interactive services and video-on-demand. By adding the two-way capability, new services can be offered that increases ARPU while reducing both churn and piracy. This is the most promising way for traditional pay-TV operators to remain competitive.
Another beneficiary of the two-way network approach is mobile TV. In its infancy, the traditional one-way broadcast method was deployed. However, it soon became apparent that consumers wanted more. Interactivity is a way of life with mobile phones - witness the SMS/MMS and ringtone download phenomena. By marrying a telecommunications network with the forward-only broadcast network, a hybrid mobile network has been created. Apart from the consumer excitement, it also means that two-way content security can be applied with all its benefits.
In summary, IP-based pay-TV networks offer advanced services coupled with advanced content security, which secures the content and revenue for the rights owners and service operators. It enables seamless service delivery to the consumer, on any screen, any time. Adopting such a security system also allows exploitation of existing and new assets, thus enhancing the value of pay-TV networks.