Sezmi Continues Rollout

New pay-TV service now available in 36 markets 8/09/2010 12:01:00 AM Eastern

Sezmi, which aims to compete with cable and satellite
operators with a new pay-TV service based on a
mixture of broadcast and broadband delivery, is continuing
its commercial rollout after successfully testing the service
in Los Angeles last winter.

The Belmont, Calif.-based startup delivers some of its programming
over the air by leasing part of broadcasters’ digital
spectrum, and has been cited by the NAB as an innovative
application for DTV. Sezmi announced last week that its entrylevel
product, Sezmi Select, is now available in 36 markets nationwide.
That represents an additional 25 markets beyond the
10 cities where the company launched
Sezmi Select in June: Boston; Detroit;
Houston; San Francisco; Kansas City,
Mo.; Phoenix; Portland, Ore.; and Miami,
Orlando and Fort Lauderdale, Fla.

New Sezmi cities include top 10 DMAs
Philadelphia (No. 4), Dallas-Fort Worth
(No. 5), Atlanta (No. 8) and Washington,
D.C. (No. 9), as well as No. 13 DMA Seattle,
where Sezmi had previously tested
its system with stations owned by Fisher,
Tribune and Daystar. Sezmi generally partners
with two to four stations in a market,
netting 15 to 20-plus megabits of usable bandwidth, according
to Sezmi co-founder and president Phil Wiser. But the company
isn’t disclosing what stations it is currently working with.

Sezmi, which was founded in 2006, delivers its service to a
specialized set-top and indoor antenna through a hybrid transmission
scheme it calls Flexcast. The Sezmi box has standard
DTV reception capability for watching free, local over-the-air
MPEG-2 broadcasts and can also receive MPEG-4 program
streams that Sezmi inserts in a portion of the DTV spectrum.
It also has a broadband connection for accessing online video
and receiving guide data. The box, which is manufactured by
Taiwanese conglomerate Tatung and is being sold online for
$149.99, also has a terabyte of storage for DVR capability.

The mix of broadcast and broadband delivery is how Sezmi hopes to offer a costeffective
alternative to
existing pay-TV options.
It plans to use
the broadcast spectrum
to deliver popular
cable channels for a monthly fee, and the broadband pipe
to give on-demand, pay-per-view access to thousands of TV
shows and movies as well as the ability to watch free online
content from YouTube and other Web sites. Sezmi also provides
a personalized user interface that allows consumers to easily select
their preferred mix of broadcast, cable and online content,
and manage their time-shifted programming.

But the current Sezmi Select service doesn’t include linear
cable programming, and as such is competing more with overthe-
top devices than cable providers. For a monthly fee of
$4.99, consumers who buy the Sezmi box can use the DVR and
the program guide service and buy on-demand content from
partners such as Discovery and Warner Bros. The only market
where the full-fledged Sezmi experience, including cable
channels, is currently available is Los Angeles. Sezmi customers
in that market pay $19.99 a month for
Sezmi Select Plus, which offers 23 cable
channels from Turner, Discovery, NBC
Universal, MTV Networks and others,
but none of the offerings of cable sports
giant ESPN.

Wiser says that Sezmi has been finetuning
Sezmi Select Plus in Los Angeles
and plans to roll it out to other markets
later this year; Sezmi Select customers
will be able to upgrade to the expanded
service. Sezmi already has deals in place
with programmers and local stations to
offer linear cable networks in its current markets, he adds, but
still needs to deploy headend equipment to most of its partner
stations to receive and retransmit the programming.

Many broadcasters are eying mobile DTV as a potentially
lucrative use of their spectrum, of course, and others are considering
the possibility that the government will compensate
them for voluntarily turning over part of their spectrum per
the FCC’s broadband plan. But according to Wiser, Sezmi’s station
partners haven’t shown any hesitation in moving ahead
with their spectrum deals, which he views as a reflection of the
financial uncertainty surrounding those alternative paths.

“We’ve been able to get spectrum in every market we’ve gone
after,” Wiser says. “We have a business that works right now,
and we’re writing checks today.”

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