There are two questions to be asked about Ericsson’s acquisition of Microsoft Mediaroom: why did Microsoft take so long to get rid of it? And is Ericsson buying a pig in a poke?
To begin with the first: at IBC 2009, I interviewed Ted Malone, senior director of product management for TV, video, music and platform business at Microsoft, about the future of the Mediaroom platform, and was struck by the way it was co-opting Microsoft’s OTT technologies.
For instance, said Malone, the Mediaroom security platform would migrate from using Windows Media Player DRM to PlayReady, which was already part of the its OTT Silverlight platform, to facilitate streaming to other devices in the home.
Indeed, Mediaroom itself would be extended to support Silverlight, and would also adopt its Smooth Streaming technology in due course, he indicated.
Malone expressed this as making Mediaroom more ‘open’, but it seemed to me the moves were more of a precursor to Microsoft phasing out Mediaroom altogether.
As I subsequently wrote, “the need for Microsoft to support two entirely distinct product lines is disappearing.”
And so it has come to pass – if rather later than I had anticipated. The gloss being put on the move is that Microsoft can now “commit 100 percent of its focus on consumer TV strategy with Xbox”, but that does feel a bit like just another way of admitting that, in an OTT world, Mediaroom had simply had its day.
But if it has, what’s the benefit to Ericsson?
The short-term attractions are clear: Ericsson can now provide an end-to-end managed IPTV platform to its customers, neatly encompassing the old Tandberg TV business at the encoding end and Mediaroom STBs at the other.
It can also strengthen its relationships with Tier 1 telco Mediaroom customers such as AT&T, Deutsche Telekom, Telefonica and Swisscom, from whom it will now derive new revenue streams.
But long-term, is Ericsson backing the right horse?
Mediaroom has certainly had its critics: it buys its superior performance in areas such as rapid channel-switching through the creation of an expensive server architecture at the network edge; and its middleware implementation complexities have been responsible for many a ‘launch delayed’ headline in the trade press.
But fundamentally, this is really about two competing visions of the future: one in which the multiscreen revolution is addressed by tightly-managed IP Multicast networks and complex in-home gateways which seek to replicate a traditional pay-TV-like, ‘guaranteed QoS’ approach; and another where connected devices are served directly from the cloud with agile, unicast, OTT IP video streams, and in which CDNs and adaptive bit-rate technologies are used to assure QoE.
The acquisition of the Mediaroom technology confirms that Ericsson, for good or ill, has positioned itself firmly in the first camp.