Over the years I have been asked about support for legacy STBs. The high-level argument is simple; as an operator you have invested in and deployed 1, 10, 100 thousand STBs and as you evolve your TV solution you want to reuse this investment. The good news is that there is almost always a technical solution for this. The more important thinking is whether reuse of older STBs is a good thing to do for your TV service. Let’s look at the considerations that are important as you make your decisions.
Reusing deployed STBs has advantages:
- Reuse of sunk investment and avoiding the capital cost of replacement.
- Not disrupting customers who are happy with what they have – disruption like replacing STBs may trigger churn.
- Retention of STB rental revenue – customers may be paying $5 per month or more for these older units.
So do these points create a compelling reason to retain the older units as you upgrade your TV service? – well maybe not. Let’s think about some of the counter arguments.
Slow and incomplete user experience: I have worked with some operators who have had a field population of 8+ year old STBs. Now think of a phone or a laptop that is 8+ years old – would you use it to run the latest application? Would the latest applications even run on these platforms? The rate of change of hardware capabilities has continued over the years so that hardware which is older will have issues with performance and function. It will also start to have field failures. You may get the new software to run on the unit but the experience, but it will likely be slow and may not have all the features the user expects.
Customers churn anyhow: The pace of change in TV has accelerated over recent years and cord cutting/shaving has become significant for most payTV operators. Leaving consumers on older, slower, feature poor platforms is likely to trigger higher churn rates. Operators need to be proactive and offer consumers a compelling TV experience if they wish to attract and retain.
Breadth of content: Consumers access TV content from payTV and from apps (Amazon, Disney etc). Consumers want easy access to all content and modern software platforms like AndroidTV enable this easily. Getting application support on older platforms may not be technically possible at all or if it is possible, it would come at a high cost.
Availability of lower cost options: Operators now have options which can make the replacement costs significantly lower. New IP STBs have taken advantage of new hardware and offer a much better cost / performance profile than older STBs. In addition, consumers can now access TV via multiple consumer platforms like Roku, AppleTV and Amazon Fire. Taking an app-based approach can offer consumers a compelling service without any device Capex for the operator.
In the end operators need to assess their own context and business case but I feel that leveraging legacy STBs is not a good approach in the middle term – the cost of supporting and servicing outdated STBs is likely more than replacing STB hardware. The pace of change in TV is very fast; if operators do not offer consumers what they want then they will churn. For operators, the right decision is to drive forwards with rapid deployment of TV solutions that meet consumer needs.
Click here to learn more about our Enghouse EspialTV solution on Legacy STBs.
