Intel is yet to close a single content deal for its upcoming Intel TV service, sources claim, despite reportedly offering media companies as much as a 75-percent premium over what traditional cable firms pay. The combination live and on-demand TV service is expected to launch this year, according to Intel, but insiders familiar with the ongoing content owner negotiations tell Reuters that no programming has actually been settled upon at this stage.
That’s even though Intel is believed to be offering a considerable amount more for use of the shows than its established rivals. Although specific offers have not been made public, sources familiar with the talks claim that Intel is willing to pay between 50- and 75-percent more than the average fees calculated by research firm SNL Kagan, which tracks cable and satellite rates.
According to the insiders, Intel has been forced to become “substantially” more flexible in its willingness to pay for content, compared to its relatively hard-ball tactics at the start of talks. Digging deeper into the corporate wallet isn’t the only concession, either; it’s said that Intel has suggested other placatory measures, such as disabling the ability to fast-forward through commercials during the first run of any show.
So far, Intel is said to have reached some level of agreement over potential content delivery with CBS, News Corp, and Viacom, though not specific programming-level deals. NBC Universal is also in talks, though they’re described as “not as advanced” as the others.
The struggle to cement deals at competitive rates is something Intel isn’t believed to be alone in. Apple has long been rumored to be considering an on-demand TV service which would offer a pared-down array of channels rather than the massive bundles traditionally associated with cable and satellite, but is said to have been hamstrung by content owner reluctance to give up the lucrative bundle deals.
Those deals – in which a few more-coveted channels are padded out with other content, with no way to license them individually – are a relative cash-cow for the content owners, with little incentive to break them down as per Apple and Intel’s wishes. Added to Intel’s struggle, industry insiders claim, is its complete lack of subscribers at present: that means it will inevitably pay a premium until it can prove its market value.
Intel confirmed its TV plans back in February, though only gave a release window of sometime this year. Part of its value-proposition for content owners is the degree to which it can give demographic data for advertising purposes: a camera built into the set-top box, for instance, will be able to record the age group, gender, and other details about those watching.
The STB is also expected to use a motion-tracking remote control, as part of Intel’s Media Server Reference Design (MSRD) platform. Based on an Intel Atom CE5300 multimedia chipset, the MSRD could also be outfitted with the necessary camera for demographic analysis, as we saw demonstrated earlier this year.