Xbox Live TV Won't Compete with Cable CompaniesXbox Live has become much more than an online gaming service, providing music, movies, videos, services like Netflix and Hulu, social networking through Facebook and more. Microsoft continues to grow its network, and for some time, the thinking was that Microsoft would attempt to challenge cable and satellite companies by offering a similar TV service. Back at E3, Microsoft unveiled Xbox Live TV and it's clear that, at least initially, Microsoft won't be fighting cable companies whatsoever.
IndustryGamers recently talked with Interactive Entertainment Business CFO Dennis Durkin, and asked him point blank if Microsoft had a desire to compete with cable, but if anything, Durkin said Microsoft would be more inclined to create more partnerships with them.
"You may be familiar with some of the work we’re doing in the U.K. with BSkyB and Canal+ in France and we also have a partnership with Foxtel in Austrailia. So these are all pay-TV operators. And basically, we’re partner friendly as it relates to their business model. We’re not trying to compete with them. We’re trying to enhance the services that they offer for their customers," he explained.
Durkin further elaborated on what Xbox Live provides by working with them: "If you think about it, a lot of Pay TV operators can’t do a lot of things in terms of social that we can do inside our Live network. They can’t do things with input as it relates to Kinect, whether that be with voice or with gestures. They can’t do things with facial recognitions to know who you are versus other people in your family. So there’s a lot of things that they can’t do and they look at what we’ve done inside the gaming community and how we built achievements, how we built connective tissue amongst users, whether they’re on the same couch or whether they’re halfway around the world. They look at those as unique things that they can now bring to their customers. And so, what we found is, by having reinforcing business models and working with them... so you’re a BSkyB customer in the U.K. and an Xbox Live customer, we’ll both support each other’s businesses in very positive ways. And we’ll continue to do that. So we’re very partner friendly as it relates to that."
"We also, in the U.S., with ESPN, we’ve partnered to bring ESPN3 within our ecosystem, which is an announcement we had last year. Again, very partner friendly. They have a business model where they go to market and they monetize that distribution via ISPs - so internet service providers pay them for that ESPN service and we authenticate inside of our business. So if you’re a customer of an ISP that is participating with ESPN, then you get all of that content inside our ecosystem. So we’re trying to be very partner friendly as it relates to bringing this content into our ecosystem."
What do you think? Is Microsoft going about this the right way, or would they be better off challenging these companies head on?
