The Node Nadir

{ON} 22 July, Altech (Allied Technologies Limited) announced that the NODE, its Video Streaming decoder, has unfortunately failed to take off with the South African consumers in the Pay Television sector and that it was planning to sell it. Here is a machine, which besides its Video On Demand (VoD) function, offered to smarten up your home with security system through motion detection. It sought to enable you to surf the internet through its embedded 3G or use it as a wifi hotspot around your house as well as a host of cool capabilities such as the ability to buy air time, pre-paid electricity as well as pay your Telkom and Eskom bills all from the comfort of your home. After nodding several times as I list these features you might be compelled to raise your index finger and enquire about the machine’s data gobbling appetite. Well the NODE uses satellite technology to push video content into its 1 Terabyte hard drive without data costs the same way DStv’s catch up Service functions. However the traditional use of internet comes with data costs which is fair enough; we’re so used to spending for data connection anyway ¶⌋

Altech's Node. image source: http://www.techcentral.co.za/wp-content/uploads/2014/09/Altech-Node-640.jpg
Altech’s Node. image source: http://www.techcentral.co.za/wp-content/uploads/2014/09/Altech-Node-640.jpg

Ψhen the NODE was launched the climate was very conducive to its arrival. Top TV’s pretty hyped up launch four years ago had flopped dismally and its ship had sunk into bankruptcy. Its business rescue dust scuffle contest between Multichoice and Dynamic TV had all but settled except for the dust film vivid to those who care about television. It morphed into StarSat after an acquisition by the Chinese. This by no way would change its fortunes and its stint of being seen as an alternative to DStv came to an abrupt end. On the other side of the contested field Platco’s OpenViewHD had made inroads into the low income earning households who could afford an installation of a standard decoder but could not afford the hefty monthly installment that pay television demands. OpenViewHD siphoned disgruntled viewers who wished to make a jump to DTT (Digital Terrestrial Television) both from the native source, SABC (South African Broadcasting Corporation), as well as from the rebranded StarSat


>>>what exactly was the entry of NODE in the Pay Television Sector (PTS) addressing?


ïn the middle of these developments a new player in a form of video streaming service, VIDI, owned by Times Media Group (TMG) had launched, taking advantage of the growing trend of video streaming that had seen services such as NETFLIX and Hulu established in America. We can speculate how at one point TMG’s strategists might have whipped out their crystal ball and looked into the future, studied global media content consumption trends of recent and bet that viewership would eventually migrate towards internet-based services officially. Whether this was a sound business decision we’re yet to find out. In any case those savvy with technology, craving for such a service have been video streaming for quite a while. A legitimate service was needed and fast. As the lights dimmed on the contested field mid January this year, MTN’s FrontRow went live in the video streaming avenue scraping off whatever that was left unto the mobile platform before the next scene went live

{S0} what exactly was the entry of NODE in the Pay Television Sector (PTS) addressing? Let us step away from the contested scene so that we can appreciate the scenery in its full panoramic splendor. The SABC addresses public needs in terms of Free To Air Television (FTA) content. It is a basic staple diet with e.tv complementing it as a desert. DStv is a step away from free to air television into pay television service. StarSat is a poor alternative to DStv. OpenViewHD, is the blueprint of what the SABC could look like once it has made a jump to DTT whenever that will be. Presently OpenViewHD is a safety net, if not an alternative, to those who are either disgruntled with StarSat or cannot afford to pay DStv but would still like to have some choice other than the four FTA channels in South Africa

Let me repeat the question that opened the last paragraph for the sake of consistency. What exactly is it that the NODE was addressing in the pay television sector when it launched? …it is 18 September 2014 and the NODE launches with a purchase fee R 3 499.00 (free installation inclusive) and a monthly subscription fee costing R 300.00. It is easy to conclude that the NODE, should we use DStv as a barometer, was aligned with that service provider’s Compact bouquet’s subscription fee at the time of launch. Let us stay here for a while. The difference was that while the NODE functioned like DStv’s Video On Demand service it lacked linear viewing, meaning it was digital television minus real time viewing channels such as SABC 1 slash Mzansi Fo Sho or even e.tv, there was no FTA in the offing. As I said just now that SABC channels are the staple diet of South African television, can you really imagine life without them? This is exactly where Altech’s strategy went wrong with the NODE. Altech disregarded this simple fact, unless perhaps they thought people could keep their DStv decoder, downgrade their current bouquet and complement it with the unknown NODE’s V0D service. What would be the costs of home entertainment then to households barely surviving in current economic climatic condition?

Ψith a simple sidekick Multichoice strategically responded on the 24 September 2014 by making its premium service BOXOFFICE available to the Compact Bouquet. Thanks to the NODE now subscribers of that money-spinner bouquet for Multichoice could rent movies. There will be no need to make drastic changes to another device or service. Talk about customer retention, Multichoice turned slightly on to the other side of the onslaught wherein video streaming was concerned and there it saw there were no threats as it has already fired its plasma missiles to open BOXOFFICE online subscription to anyone regardless of whether they were its customers or not. With the contested field rancid with bellows of smoke the behemoth withdrew to its R&D headquarters. It would step out again if there was any threat to deal with

∩ow that Altech has announced that it would sell the NODE in the not so distant future whoever is thinking of buying should think very deeply before tinkering with its functions. South Africa needs the NODE but it just does not know it yet. Part of the problem is how the machine was positioned in the market. The fact of the matter is that it is pretty expensive for new entry level Pay Television Subscribers or to fundis. Even its advertisements, billboards or television, were not compelling to the ordinary South African. You just didn’t feel that you could own a NODE. The buyer needs to only crank up NODE with FTA channels while retaining the R 300.00 monthly subscription fee in order to retain the NODE’s loyal customers to experience this slight refurbishment. They must be ready to lose some money before they can stimulate returns. Only in the new financial year 2016/17 subscription fees can go up in order that the NODE can match its rival’s and gain traction on the set market price which to date is around R 319.00. That way the new owner will throw candy to those seeking an alternative pay television service. Oh, by the way the new owner should steer away from being complacent and concentrate on innovation and evolution in order to guarantee the survival of this remarkable machine – the NODE ⌊¶⌉

Late winter

2 August

© Mmutle Arthur Kgokong 2015

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