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From innovation to disruption: avoiding death by a thousand cuts

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By David Price and Steve Hawley

Our previous article focused on Artificial Intelligence and its applications with video distribution, the user experience and video piracy; and we will extend on this in future articles.

Recently and with increasing frequency, our conversations have revisited a theme that many of you might remember from a decade ago as “the future with four anys.”  It was the shining future of TV: anywhere, anytime, over any access, to any device.  Now this future has become a reality and many of the technology opportunities our industry pursued over the past decade (and longer) have been fulfilled.

This time, we’ll look at how this evolution, combined with a major disruptive event that not everyone was prepared for, has had an impact on the all-important topic of video security.  All the while hoping that the next decade isn’t one where disruption itself doesn’t become the new normal.

An Evolution in Three Phases

The TV technology community has brought operators through three phases of service evolution, starting with an innovator phase of making it work, followed by an early adopter phase of making it work better and then by the rapid evolution that resulted in today’s multiscreen world.

Beginning in the early 1990s (and earlier if you recall such efforts as Microsoft Tiger, Oracle Video Server, StellarOne’s set-top box and Bell Atlantic’s 1993 VOD service) and extending through the early 2000s, the Pay TV industry began to pursue something that we called ‘interactive television’, which at the time was defined as interacting with a user interface and an augmented service.

A good example was the pioneering Canadian cable company, Maclean Hunter. Even in the analogue days they were using a return path from their STB for their customer to order pizza. From these initial efforts and the transition to digital, we got the interactive programme guide, VOD and Walled Gardens. Unlike old-fashioned straight analogue TV, these features required software infrastructures and protection using Conditional Access with smartcards.

More Efficient and More Interactive

The second phase was focused on making TV work more efficiently, with more interactive features. The mainstreaming of high-definition television was part of this phase, which was catalysed by the 2006 FIFA World Cup series. Satellite operators were the first to offer full HD, or 1080p as we know it today; with the help of MPEG-4, which promised to enable HD delivery by quickly reaching its target additional compression of 50% of the MPEG-2 equivalent.

MPEG-4 became universally adopted despite extreme competition from proprietary alternatives and a rocky road to an equitable licensing structure. IPTV, which began as a justification to use DSL to deliver video using Internet Protocol technologies for interactivity, also emerged at that time. PVR (the Personal Video Recorder) became ‘DVR’ and evolved into a whole-home service.

Also during this second phase, security became more sophisticated although it was still CA based. The introduction of downloadable software-based conditional access clients was a major innovation; the innovators being IPTV security suppliers like Verimatrix (currently in the process of a merger), Widevine Technologies (acquired by Google), Latens Systems (acquired by Pace then ARRIS), and SecureMedia (acquired by Motorola, then ARRIS, and soon by CommScope), followed by the ‘traditional’ CAS suppliers, including Nagra, NDS, Irdeto and Viaccess.

The Multiscreen Era

The third phase was the multiscreen era, which arguably was born in about 2003 with Pay TV delivery to web browsers.  But Apple’s 2007 launch of the iPhone was its inflection point, promising to extend video services to devices other than set-top boxes using streaming: mobile smartphones, tablets, PCs, streaming devices, smart TVs, game consoles and so on. Unlike set-top boxes, they used DRM, a type of protection that was familiar to enterprise computing and the music industry, but untried in Pay TV.

The Pay TV industry was slow to accept that multiscreen was meaningful to them, but that transition, too, is now complete.  Today, all of the major Pay TV security suppliers offer both CAS and multi-DRM service protection platforms, which manage both traditional and streaming delivery to broadcast, broadband and hybrid consumer devices, and generally cover all of the Pay TV use-cases.

This third phase also saw the emergence of network PVR, where real-time streams could be stored as file-based assets for later consumption on any device; eventually becoming known as Cloud DVR. This brings us to the dawn of the present day, and the complex world of TV and media has become a security nightmare.

But Where was the Disruption?

Earlier we mentioned that the security category has experienced a disruption and this disruption was precipitated by a “one-two-three-four punch” from Google.  First was Google’s decision to make its Widevine DRM platform free of charge. Second was Google’s 2015 discontinuation of the old Netscape plug-in architecture in Chrome – which had about 50% market share at the time – to HTML5’s Media Source Extensions and Encrypted Media Extensions. Motivated by the potential sudden loss of half their online subscribers, the Pay TV industry (and all the competing web browsers) moved to fully support this architecture. Third was Google’s quiet re-introduction of its Widevine CAS system, again free of charge.  Fourth was the emergence of the Android TV middleware platform.

All of this left the Pay TV CAS and DRM vendors in a very reactive position, not to mention having to compete against “Free.”

Impact on the Security Category

In January this year, Videonet invited both of the authors to make predictions about 2019, which you can read here. One prediction was to recognise that this disruption by Google is accelerating the Pay TV supplier community into new opportunities. Let’s take a closer look.

Verimatrix has expanded its video security focus to add distribution-chain security for content owners, both for traditional Pay TV service models and for direct-to-consumer streaming services from content providers and online aggregators.

In addition to video security, competitors that include Nagra, Viaccess-Orca and Synamedia (formerly Cisco’s service provider video unit, which was previously NDS) offer mature full-service delivery platforms, middleware, and secure video player software. Irdeto recently revived its middleware offering by introducing Irdeto Armor for Android TV.  All of these companies are pursuing video anti-piracy through technology solutions, professional services, or both.

Then there are initiatives that are completely outside of Pay TV, including Connected Car, secure venue access, and of course IoT.  In the face of all this, it will be interesting to see what comes of the pending acquisition of Verimatrix by Inside Secure, assuming that it plays out. The two companies have complementary product-sets, little product overlap and together could have a great opportunity.

The Evolution from Macro to Micro

Security used to be simple and all you had to do was make sure there was no significant leakage in your major channels of video distribution. But the next disruption is underway as social media and emerging 5G wireless services change TV distribution models beyond all recognition. We now live in a world of a media infrastructure being driven by distributed cloud based micro-services architectures with delivery over increasingly content aware intelligent networks.

Before this transformation, the focus was on the major ‘arteries’ to ensure their integrity. Now, in this new world, we have to examine and secure every ‘capillary’ on a continuous basis because, while each of them can be used to make TV better yet, each one can lead to piracy. Damage to an artery can be fatal, but ‘death by a thousand cuts’ is sure to be more painful.

The Next Phase

We’re now entering a new phase, to add more value and to better protect what we’ve built. Given the dramatic transformation of the TV and media technology industry (which mirrors equally dramatic changes in consumer behaviour), security has evolved and is at yet another crossroads. One path forward for security suppliers is to reorient themselves toward new opportunities where they have unique advantages – such as Nagra with Civolution and Skidata, Irdeto’s focus on software security via Cloaked CA and Denuvo, and Synamedia with its ties to Cisco for video data center security.

On another note, the evolution of video delivery has also seen changes to two widely used terms in our industry. IPTV was once the delivery of multicast Pay TV to set-top boxes over IP access.  We’re taken aback hearing the term used increasingly to refer to pirate video services distributed to web browsers, Kodi, and black boxes. Interactive TV still refers to interactivity, but now the interaction is beginning to take place directly with the content, rather than with the UI of an end-user device or with the infrastructure behind it. 

Stay tuned…next time we will examine the emerging impact of Android TV Operator Tier.

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David Price & Steve Hawley
Steve Hawley is Principal Analyst & Consultant for tvstrategies, helping service and technology providers understand and build the infrastructure to securely deliver advanced media services and user experiences to consumers, any time, to any device. ------------------------------------------------------------------------------------------ David Price is a seasoned executive in the TV & Media Industry and heads up Scala Advisors in a number of board and advisory positions with tech companies bringing transformational change to the way content is consumed, delivered and monetized