Limited Cable Carriage for ESPN 3D Start as Operators Consider 3D Strategies
ESPN 3D’s initial start on cable has been limited by some operators’ reluctance to carry the network as they weigh the costs associated with it against the limited number of 3D TV sets in the market and the technical challenges related to acquiring the programming, industry executives said. Comcast will carry the network, but others are still making up their minds.
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"It’s a complicated decision for cable operators and a lot of factors enter into it,” said Frank Hawkins, a founding partner of the media consultancy Scalar Media. Among the issues are plant capacity, set-top-box considerations, price and the number of 3D TV sets in the market, he said. “It’s no surprise they're approaching it cautiously, but eventually a lot of them will see value.” Time Warner Cable doesn’t currently have a distribution agreement for ESPN 3D, but does plan to add some 3D programming to its systems later this year, a spokeswoman said.
Some smaller cable operators don’t see the value in adding ESPN 3D to their lineups today, said Peter Smith, Wide Open West’s programming vice president. “While it’s exciting news and it probably represents a real opportunity for the future, it seems a little early,” he said. “It’s a matter of priority,” Smith said. “First we want to get the HD simulcast fully distributed, and then at that point it would make a sense to take a look at what the installed base of the 3D TV sets is” before deciding whether to allocate the bandwidth to 3D services, he said.
Other small operators are interested, said Vice President Dan Mulvenon of the National Cable Television Cooperative, which negotiates programming agreements between networks and small systems. “Even some of those that are sitting back a little bit are interested,” he said. “If the consumers are going to bite and upgrade to 3D TV, they want to be in front of it. The interest is truly there.” NCTC is in talks with ESPN for carriage of ESPN 3D but hasn’t reached an agreement yet, he said.
One hurdle is the technical difficulty in acquiring the programming, Mulvenon said. At least initially, ESPN 3D will only be available over fiber links to each cable operator, he said. “Fiber access in some of the rural areas is somewhat of a challenge."
Other technical issues in the living room have also given some operators pause, said Alan Tschirner, NCTC vice president of technology. One of the main issues is automatic compatibility between the set-top box and TV set, he said. If a viewer switches between cable-supplied 3D and a 3D Blu-ray player, the sets need to know how to distinguish between the two, he said. Early HD sets weren’t smart enough to automatically learn the aspect ratio from cable devices, Tschirner said.
Because so few 3D TV sets are in homes today, carriage talks for all 3D programming services will be challenging, said Smith. “If a network wants a license fee on every subscriber just so those who have a 3D TV set can view it, your cost per 3D subscriber can be significant,” he said. “Every provider needs to be focused on programming costs and making sure the cost doesn’t get out ahead of the value.”