BCE puts ComboBox on hold as executives re-think convergence strategy

The much-publicized Bell ExpressVu ComboBox has been quietly put on hold for the foreseeable future putting the long-term plans of a key BCE Inc. convergence initiative in limbo. BCE officials won’t comment beyond a brief response to Canadian NEW MEDIA’s inquiries, but the move to delay the introduction of the ComboBox into the Canadian marketplace is in line with other recent cost-cutting moves by the telecom giant under new president and CEO Michael Sabia. Keith Kocho, president of Extend Media – which had been tapped to deliver new applications for the convergence box – confirms, however, that a Canadian launch has been delayed for at least several quarters. A similar initiative by Rogers Cable Inc., Canada’s largest cable operator and a key BCE rival, was recently shut down, although its converged set-top box project was always labeled as a trial. The ComboBox project was unveiled to great fanfare in February 2001 when BCE announced plans to introduce a new set-top box that would integrate satellite TV and DSL Internet access with a high-memory/storage personal video recorder (PVR). The new technology was to have facilitated the delivery of advanced interactive services for TV and other applications, as well as allow the hook-up of multiple devices on a home network. The project was being developed in conjunction with EchoStar Communications Corp., the hardware provider, along with Extend. EchoStar also provides Bell ExpressVu’s satellite TV equipment. Over a year ago, BCE announced that it had successfully entered the final stage of development on the ComboBox, and a commercial launch was planned for the third quarter of 2002. But Kocho says a launch won’t likely happen now for at least the "next few quarters" as the project has been quietly been put on hold. "Things have changed a bit at Bell, as I’m sure you’re aware, in the last several months. They’ve slowed some things down," Kocho tells CNM. "At the moment, the project’s on hold and what we’re doing with them is just assisting them to market the product in other markets. Because it’s both a local offering that’s planned for the future, but also a product that could be re-sold or launched in partnership with other players, we’re off helping them do that, principally in the U.S. market in conjunction with EchoStar." BCE spokesperson Norm Berberich would only say in an email note: "We are currently reviewing how to best launch this type of product in the context of today’s marketplace and our larger examination of how to best bring broadband services into customers’ homes." He cites competitive and planning considerations for declining to make further comment. Kocho says, however, that he expects the project will proceed at some point in the future. "I think it’s just part of a broader corporate strategy to pull back on some of the expenses had. They’ve been questioning things right across the board and this was one of them. On hold is different from cancelled, right? There’s no question that they will move into this area. My belief is that they weren’t prepared to invest the funds into it that would be required to launch and manage a product like this in the current market, and I don’t blame them." To date, Kocho says, Extend has been working on applications one might expect of an advanced set-top and convergence platform. Email, calendar, enhanced interactive program guide (IPG) and instant messaging are a few of the examples he cites. The move by BCE to temporarily shutter the ComboBox project doesn’t cripple Extend, he says, though the move is frustrating. "Like anyone else, we’d prefer that the work that we’ve been doing gets into market in a timely fashion," he says. "Sure, it had an impact on us. There’s no question. But, we continue to work with them and with ExpressVu and our other clients in this space even though the market is a little more turbulent than it was a couple of years ago. We’re still doing just fine." In recent months, BCE has made several moves to solidify its bottom line, including selling its Teleglobe division and shuttering its Bell Canada International operation. Observers have predicted further shakeups to come, questioning Sabia’s commitment to predecessor Jean Monty’s convergence strategy. Many have predicted the sale of Bell Globemedia companies The Globe and Mail and CTV Inc. as Sabia focuses on BCE’s core telephony business. Rogers trial a "useful exercise" Rogers recently concluded a 12-month trial of its own converged set-top box designed to integrate various communication and entertainment devices in the home into one. Dubbed Triple Play, the service combined video (television set), data and voice (high-speed Internet access and phone service), and audio (radios and stereo systems). Announced in June 2001, the 50-customer trial of the home networking service took place in Ajax and Pickering in Ontario. A Rogers spokesperson tells CNM that the cableco learned what it wanted from the trial, calling it a "useful exercise." There are no plans at this point to proceed with commercial deployment of the service. The Rogers trial used technology from Ucentric Systems of Maynard, Massachusetts, whose Ucentric Home Networking Platform connects computers, TVs, telephones, stereos, and other appliances throughout a consumer’s home to each other and to the Internet, without the need for additional wiring. The system also enables future applications, such as centralized personal video recording on all TVs, video-on-demand on all TVs, and voice-over-IP to all telephones. In late 2001, Ucentric Systems phased in a test of its PVR solution into the Rogers trial.

BCE puts ComboBox on hold as executives re-think convergence strategy

News | 11/28/2002 5:00 am EST

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