Without dwelling on the negative impression given by statistics, Mark underscored the promise of a more comprehensive transition to digital distribution where operators across the region can recapture a significant revenue base. The potential is even more dramatic when the new opportunity for Internet distribution makes content available to those subscribers who live away from their home country.

This hits a trend that we’ve been observing– Internet video is completely changing the way expats consume pay TV. Operators see an opportunity to broadcast local programming to expats all over the world. As you can imagine, this is both a huge revenue opportunity and potentially a devastating piracy challenge.

While some of these operators are rebroadcasting signals illegally, legitimate operators have the opportunity to enhance the subscriber experience with better quality and better selections of content. Asian operators have a special opportunity to service migrant populations and communities of temporary workers.

To reinforce another point in the article, Asia represents a lucrative market for content security providers. Cost is clearly an issue in this often low ARPU region; however technology and rising awareness of service theft are changing security dynamics. Operators upgrading to digital have a more compelling desire to protect their programming assets, and more advanced layered security approaches are making revenue protection way more cost effective.

Software-based content security is catching the attention of operators that are weary of the millions of cloned smart cards in the region. Software provides the flexibility to stay ahead of the hackers with renewable security and layered techniques like watermarking or fingerprinting. Even legacy smart card vendors are getting serious about software-based security.

We are certainly excited about the opportunities in Asia as hybrid networks, enabled by IP technologies, are on the agenda of most major operators.

Read Mark’s article where he breaks out some figures on piracy type and estimated costs per country.

Compare that with IPTV operators. In the early days, theft of service was never a forefront requirement when building their networks – for two main reasons. They felt they had more control with fixed networks where the end device was a set-top box, so the threat of theft of service was potentially lower. In addition, content owners saw the emerging Internet Protocol Television (IPTV) as a potential threat and imposed much higher security requirements in order to gain rights to premium programming. Despite claims to the contrary from smart card vendors, software-based security was deemed acceptable in a two-way network and content protection was key to a full channel lineup to attract subscribers.

With the appeal of hybrid networks and novel OTT (over-the-top) services, all types of pay-TV operators find themselves in new revenue security territory. Cable and satellite providers are making strategic decisions to add more interactive services, many of which are delivered over IP-based networks. They are finding that software-only security solutions offer a more economical alternative, which are far easier to deploy, compared with smart cards that simply do not translate in the two-way environment, in particular in the case of mobile devices. 

IPTV providers are now looking into OTT services that deliver content outside their controlled, managed network. They need layered security solutions to take advantage of different delivery mechanisms outside of the living room. Plus IPTV operators with rights to exclusive content have become an attractive target for hackers, so theft of service prevention is a higher priority.

You can now put revenue security on the list of how these pay-TV services are converging. Operators require a flexible protection solution that can handle different networks, delivery formats, multiple end devices and the addition of new services – the ultimate goal is help monetize content, increase ARPU and reduce churn.

Come see me at Digital Hollywood Fall where we will tackle the latest DRM standards and actual technology implementations – today at 12:30!