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Is Sezmi a "cable killer"?

Posted on May 1, 2008 by Jeremy Toeman

As I write this, Comcast is worth 67 billion dollars.  Their stock has split 4 times in 20 years, and has grown massively over that time.  They have over 24 million subscribers.  They are one of several US cable companies, who take on the 2 satellite service providers as the main players in the TV space for the US.  And startup Sezmi was labeled today as a cable killer, with TV 2.0, whose advanced set-top box apparently blows away the TV.  Wow.  That’s quite a strong billing, don’t you think. The last device I recall with this type of hype was supposed to transform the way we build cities.

This isn’t just David vs Goliath by the way, this is David the little tiny ant versus Goliath the elephant.  Not only does Sezmi have to compete against huge players, they are doing it in a massively entrenched industry that spends ridiculous amounts of money advertising their own services.  And let’s think about that advertising for a second – where exactly is Sezmi going to run their ads?  Are they going to pay the very networks they need to compete with?

Now I do need to make a very clear disclaimer here: I have not used their product, nor even seen a demo.  I will go on the leap of faith that they have built the very best darn box ever built (even better than the ones I’ve built!).  I’m going to assume it’s utterly amazing, and the content quality is stellar, it’s really usable, etc.  I’ve only seen one such demo in recent months, but that’s another story for another time.  Let’s assume that in the world of “terrible Internet set-top boxes” they’ve built the iPhone of the batch.   I still think they have a huge challenge ahead.

First, they need to market the heck out of this thing.  I’ve watched MovieBeam try and fail, ReplayTV is gone, Akimbo is a service now, and even everybody’s favorite TiVo isn’t exactly a commonly owned product (somewhere around 5ish million homes is the latest I’ve heard).  Each of these companies have spent millions of dollars trying.  And I can name a dozen others who’ve tried.  Even Apple can’t really move the AppleTV in massive quantities.  And massive quantities is the only way to be successful as a startup in this space.

Beyond just “extremely good” marketing,  it’s a big uphill battle for Sezmi.  Both PaidContent and Engadget refer to the company as confusing.  In the articles I’ve read the company’s advantages seem to lie in (1) price, and (2) Internet services.  I don’t believe these to be true competitive differentiators in the “taking on the cable industry” space.  The players that be have effectively infinite dollars to throw at the problem, and we know they are all working on introducing Internet-enabled devices themselves.

Having spent most of the past 10 years of my career attempting to introduce products just like these, with variations here and there, I do wish the founders the best of luck with the effort.  I would love to try the box out, see if it’s exceeding expectations and get a sense of how they plan to accomplish their arduous task.  I think the visions of wanting to “change television” are noble, but unrealistics.  Just because we have deregulation and things like OpenCable doesn’t mean the window of opportunity is open.

I do believe we’ll see additional interesting new media concepts for digital devices and platforms, but I don’t believe going after the big guys is the way to be successful.   It isn’t about a “better than your cablebox” or a “more channels than you have now” or even a “get the Internets on the teevees” kind of play.  It’s about counterprogramming against the TV itself.  It’s about innovating on other, existing platforms.  It’s about moving around the concept of the cablebox and cable company completely.  Is Sezmi here with that new Innovator’s solution?  We’ll find out soon enough.

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About

Jeremy Toeman is a seasoned Product leader with over 20 years experience in the convergence of digital media, mobile entertainment, social entertainment, smart TV and consumer technology. Prior ventures and projects include CNET, Viggle/Dijit/Nextguide, Sling Media, VUDU, Clicker, DivX, Rovi, Mediabolic, Boxee, and many other consumer technology companies. This blog represents his personal opinion and outlook on things.

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