Sramana Mitra: That’s what they do.
Mark Hyland: This year, they’ll say that’s what they do. We’re different from 90% plus of those vendors because we’re doing it all from the cloud. There are many vendors that are selling encoding gear, sending network optimization, and selling application experience or different components. But there are very few that are knitting it all together to create an end-to-end service that’s delivered from the cloud. To have that capability globally puts QuickPlay in the company of five or ten other companies tops.
SM: What are those five companies?
MH: Well, Moby TV has that capability. There are a handful of others, some Swedish companies. There are some challengers. Avail TVN has been a traditional pay TV provider that has the capability to move into this IP delivery. There are lots of people close to this space who could come into it. But when we’re in contests and competitions, we’re generally able to tell a good story about being an experienced, reliable cloud-based provider.
SM: Talk to me about that experience of working with the cable providers and pay TV providers. Let’s take a couple of case studies. What are you learning? What’s happening inside them?
MH: Well, think about it from their perspective. You’ve got ongoing accelerating technological change. There are new video formats, new devices, and they’ve gone from having a fairly infrastructure-centric view of things. They had pretty big irons in their ad ends, and they would feed signals to set-top boxes. The set-top boxes were relatively homogeneous in the sense that there might be a handful of vendors selling them. And there were different versions of set-top boxes, but fundamentally, there was a fairly consistent terminal at the other end.
Now, you’ve got literally anything. We’ve got a service in Hong Kong with a big Hong Kong broadcaster called TVB. There are more than 2000 devices hitting that service. It’s now virtually impossible to anticipate everything. So, it’s any IP connected device.
We have a great study with a cable operator in Canada where essentially, we have an ongoing case to make with our customers that we can do it as reliably, more quickly, more cheaply, more effectively than they could do it in house. There’s a whole array of cultural factors as well as vendors saying, “Just do it in house. Buy this encoding and our stuff will deliver to iPads, no problem.” Probably our biggest sale to make is that first of all, you should consider outsourcing this. That’s the number one fork in the road that we have to cover. A lot of companies, especially the bigger ones, have the engineering wherewithal. They have the culture to do this themselves.
SM: And that’s their first instinct – let’s do it ourselves.
MH: Yes. We understand that. We also have learned and come to say that Riley, our best customers, are those who have gone down the road to do it themselves and either failed or just said, “Wow, we’re doing this but we can picture this scaling up for three years. We can picture our operating costs getting more and more sky high. Yeah, maybe it is time to look at outsourcing this. So, we have a good example with a Canadian cable company called Rogers. They’ve been a long-time customer. We worked on their wireless side ever since the beginning of the company in 2004.
What was interesting was that we wanted to try to do business on the cable side. Initially, it really was that they were going to do a lot in house. They still do a lot in house. They have a great road map and a lot of smart technological people and so on. But they’ve also identified aspects like encoding, like certain Web tier services, like certain aspects of the end-user applications that they’re having us do. In a sense, it gives them one focus. They can have product managers relating to us. We’re responsible for delivering. If we don’t, they know that they can hold us to the fire because we’ve signed service-level agreements promising to do X, Y and Z.
This is the shift that’s happening now. We’re seeing a great number of people who we call, even those major European operators known for building their own solutions, who are saying, “Well, actually, either we have a proof of concept,” or “There’s something we want to do and our internal systems just can’t get us there quickly enough. We need it in market in November, and for whatever reason, our road map is off in a different direction,” or “The resources aren’t there,” or “It’s too expensive,” or “It’s too inflexible,” but “Please, can you help us out?”
This is a new and exciting thing for us to hear. It’s the last frontier in a way. We’ve had to sell so hard to persuade outsourcing. Now, the tide is starting to turn where everyone’s like, OK, we know this makes sense, and we’ve seen that companies like QuickPlay can deliver time-to-market. Believe me, I’m the first to admit that we’re not perfect. We have a learning curve like any other company, but we are completely focused just on this area. So, we are learning and improving.