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Nonresponding
Digital Set Top Box (STB)
Realizing pay-per-view purchases before they become orphans
By: Bruce Bahlmann - Contributing Author (your
feedback
is important to us!)
Created: November 6, 2003
| Published by: |
NCTC NewsLetter |
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January 2004 |
This paper discusses the benefits of
managing nonresponders
this software is available from Birds-Eye Network Services.
A few months ago, a large US cable operator came to
Birds-Eye Network Services, LLC with a problem. They had just completed
a massive change to their existing digital STB platform that would allow
them more local control. However, in completing this migration it became
apparent that their rate of nonresponding STBs was going increase
significantly. Having always been conscious of their nonresponding rate,
the threat of this increase prompted this cable operator to seek outside
help. A nonresponding STB is a STB that has been placed into a
customer’s home but for some reason does not respond to purchase polls
performed regularly by the cable operator. This article describes the
problem caused by nonresponding digital STBs as well as introduces
Birds-Eye Network Services patent pending software that alleviates this
problem.
Although pay-per-view (PPV) in the US brought in nearly
$2.4 billion in revenue in 2002, the rate of nonresponding STBs among the
leading cable operators averaged between 7-15%. Based on calculations
performed by Birds-Eye.Net (see
our white paper on nonresponding STBs) each nonresponding STB cost cable
operators $9.65 per month. As a result, nonresponding STBs continue to limit
the maximum revenue potential of PPV - the second largest money maker for
after market movies (second in the US only to the $8 billion movie rental
business).
The problem of nonresponding STBs is not new and its
roots can be traced back to early advanced analog STBs that incorporated a
technology and service called impulse-pay-per-view (IPPV). Essentially, IPPV
enables cable operators to offer PPV content that can be purchased directly
from the STB. IPPV allows PPV content to be selected and purchased using the
STB remote control and then during the purchase, a message (impulse) is sent
by the STB up the cable plant to a special computer located within the cable
operator’s headend where each purchase can be authorized, configured, and
recorded. The major problem with the initial design for IPPV purchases on
the STB was scalability. If too many customers try to purchase video content
at the same time the system managing the authorization for this content can
easily become overwhelmed thus blocking, dropping, or otherwise preventing
other customers from successfully purchasing their desired content. The
“fix” for this scalability problem is to empower STBs to take control of
this situation by allowing them to independently authorize the viewing of
content. Although there are many different variations of this “fix”,
essentially they all centered around allowing customers to purchase and gain
authorization to view some number of restricted video content independently
of the STB needing to successfully communicate with the cable operator’s
computer in the headend prior to the authorizing the event. Each STBs is
therefore given the authority to carry out independent PPV purchases
(requested by their operators – cable customers) along with some number of
tokens which effectively permit some maximum number of PPV purchases on that
STB until such time as either these purchases were retrieved and cleared or
the number of tokens becomes exhausted.
The special computer located within the cable
operators’ headend is tasked with performing collections on these STBs.
Collections consist of conducting a type of polling where each STB is asked
for a listing of its purchased content. Upon successful receipt of all
purchased programs stored on the STB, the STB is instructed to clear these
stored purchases and reset its available tokens allowing more content to be
purchased. While this whole process works amazingly well a majority of the
time, an appreciable percentage of STBs regularly have a difficult time
responding to purchase polls. When these difficulties surface (the purchase
poll cannot successfully perform collections of PPV purchases on certain
STBs), the clock begins to tick on the cable operators’ ability to retrieve
and successfully collect these PPV purchases – the longer the clock ticks
the more likely the customer will not be charged for any PPV purchases
stored on their nonresponding STB.
These uncollected PPV purchases are what the cable
operators call orphan purchases. Orphan purchases represent purchases made
by the customer that the cable operator is unable to timely and properly
assemble and attach to the customers’ bill before information required to
easily do so has passed. It is at this point that the cable operator fails
to capitalize on PPV purchases made over their system.
Nonresponding STBs cost cable operators much more than
just lost revenue due to orphan purchases – this is only the beginning.
Actual costs involve personnel required to call customers with nonresponding
STBs in attempt to correct these issues, personnel required to receive calls
from customers who have exhausted their allotted tokens or are unable to use
PPV, and service calls to customer dwellings who have these issues – this is
just the beginning. There are also other costs depending on what other
interactive services are sold by the operator. For example if the operator
is offering Video on Demand (VoD), any customer with a nonresponding STB
will be unable to order a movie nor will they be able to take advantage of
any other interactive services. Essentially, nonresponding STBs prevent
operators from exploiting the full revenue potential of their systems while
chewing up valuable time from operations personnel.
To address this problem, Birds-Eye Network Services
developed an application suite to help cable operators finally get their
arms around the pesky problem of nonresponding STBs. The goal of this
application suite is help cable operators effectively reduce their average
nonresponding STB rate by providing tools and valuable information required
to troubleshoot, locate, manage, and streamline the process of resolving
nonresponding STBs. This patent pending application suite has proven results
in having reduced its first customer’s nonresponding rate from a high of
9.87% down to 4.54%. One of many benefits of having this application suite
is the luxury of finally knowing where to look. A series of reports provided
by the application suite help cable operators significantly narrow their
search for where nonresponding STBs exist and provide them with the
information they need to help find problems whether they represent
individual issues or plant related issues.
Another benefit of the Birds-Eye Network Service
application suite is the ability to track STB operational history. The
moment a STB goes nonresponsive it enters a database where various metrics
are tracked alongside manual operations performed by operator employees to
resolve this issue. Since resolving these issues can become excessively
manual, it is important for operators to understand how much time they are
spending on various issues, who from the operator is working these issues,
and what is their success rate. The application suite can also be used to
generate performance reports for those working nonresponding STB issues.
Supervisors and managers can use these performance reports to track the
performance and progress of their team as well as provide data for periodic
employee performance reviews.
In the
future, the handling of nonresponding STBs will increasingly be automated
and require fewer operator employees to produce an even higher degree of
success. Birds-Eye Network Services believes the lowest nonresponsive STB
rate attainable is between 1.5% and 2%. This remaining rate represents the
percentage of customers who have done something within their dwelling that
has adversely impacted their STB from responding properly. Beyond this range
however is believed to be operator self-inflicted issues, meaning these STBs
are nonresponding due to an incorrect installation, service call, drop
issue, plant issue, etc. As operators are provided more information specific
to helping them resolve nonresponding STB issues they increasingly achieve
reductions in their nonresponding rate – not overnight but gradually over
time. There is no magic pill for nonresponding STBs. Only through carefully
guided efforts will operators make headway in this area.
Check out these other Birds-Eye.Net papers/products regarding
nonresponding STBs:
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