Chances are high that your next TV set-top box will have features like a multi-room DVR, Internet access and home networking — even if you’re a cable TV customer, says Michael Inouye, a TV industry analyst with ABI Research.

In a new report, Inouye projects that there will be 15 million next-generation set-top boxes in the market by 2014. These 15 million boxes will have MoCA, a technology that uses existing coaxial cables to send video to devices throughout the home. While other home networking technologies like Powerline (uses electrical lines)  and HomePNA (uses phone lines), are gunning to be in the next set-top box, Inouye said that MoCA is attracting the TV companies that actually provide the hardware to consumers.

My first thought? Cable companies have long offered set-top boxes with advanced features. But they haven’t enabled them. The USB and eSATA ports on my cable TV box don’t work so I can’t add a hard drive to store more TV shows or view photos. I asked Inouye to tell us what really might happen with future set-top boxes.

“Indeed, you are spot on in regards to cable providers’ previous practices of limiting STB (set-top box) functions. But in many cases just because it’s not ‘active’ doesn’t mean it’s not there, so when we established the forecast we focused on estimating the number of boxes that could support MoCA (e.g. hardware in place) but not necessarily active,” Inouye said in an e-mailed response.

Ahh… so, no MoCA features for cable customers. No, not quite, Inouye said. He said that several cable companies — including Time Warner Cable and Cox Communications – are committed to MoCA.

While MoCA on the boxes may initially be inactive, he said, “This also doesn’t mean it will always be inactive, the cable operator can just ‘flip the switch’ as it were to turn it on when they are ready. … A very large number of the cable operators in the U.S. will embrace MoCA. MoCA in general will compete in areas with high coax/cable penetration, North America being such a region.”

Cable companies need to start offering more services, like the multi-room DVR, because the competition is already doing so. Verizon FiOS, AT&T U-verse and the satellite companies have long offered the feature to users. Cable? So far, Cox has announced it is coming while Time Warner says it is committed.

Inouye said that making the integration easier are companies like Irvine’s Broadcom Corp., which is responsible for several set-top box chips that already have MoCA. Because Broadcom chips are already heading to new set top boxes, the TV provider can simply activate MoCA  by pushing out a software upgrade. Another set-top box chipmaker, San Diego’s Entropic Communications, is also pushing the technology and recently added DirecTV as a customer.

“The general perception has historically been the cable providers have lagged in terms of things like home networking – which was true. Verizon is already using MoCA and AT&T is using HomePNA in their boxes – other Telcos are also using various networking solutions. DirecTV currently offers adapters for Wi-Fi and Powerline to connect their HD DVRs for VOD but in the end they decided to integrate MoCA,” he said.

Favoring MoCA could also lead to the next big evolution in TV service: Watching TV online. Inouye links MoCA with TV Everywhere, the Comcast Corp. and Time Warner-backed service to offer some cable TV shows online to paying customers.

“The cable operators however are starting to move in a similar direction and are expected to start pushing more advanced features – perhaps in some small part furthering their ‘TV Everywhere’ concept.”

Beyond the multi-room DVR, MoCA has other features consumers can look forward to, Inouye added. Read his complete unedited responses below:

QUESTION: Your projection is for 15 million boxes to have MoCA by 2014, but cable companies are known for limiting set-top box features. Do you believe cable providers really plan to turn on the feature?

	Michael Inouye

INOUYE: Indeed, you are spot on in regards to cable providers’ previous practices of limiting STB functions. But in many cases just because it’s not “active” doesn’t mean it’s not there, so when we established the forecast we focused on estimating the number of boxes that could support MoCA (e.g. hardware in place) but not necessarily active – this also doesn’t mean it will always be inactive, the cable operator can just “flip the switch” as it were to turn it on when they are ready. With a multi-room DVR set-up you also need more than one MoCA ready box – e.g. the DVR and a “thin client” or another STB.

Broadcom offers integrated SoCs (system on a chip) with MoCA for cable set-top boxes (BCM7420, BCM7408, and BCM7410) which will likely spur adoption and Entropic Communications, the main incumbent, already has traction with Verizon (which is often classified as a cable operator) and recently announced DirecTV (as a note we put Verizon with the Telcos).

I’ll discuss which cable operators in the next question but suffice it to say a very large number of the cable operators in the US will embrace MoCA. MoCA in general will compete in areas with high coax/cable penetration, North America being such a region. While other regions like Europe have yet to gain traction, many of the operators are still in the early stages (e.g. still trying to decide which technology to embrace) or just starting to gain interest in home networking, although interest is reportedly starting to pick up – so for those countries with higher coax penetration there are opportunities for MoCA.

In the next question you mentioned satellite and IPTV providers in place of cable, I imagine because the general perception has historically been the cable providers have lagged in terms of things like home networking – which was true. Verizon is already using MoCA and AT&T is using HomePNA in their boxes – other Telcos are also using various networking solutions. DirecTV currently offers adapters for Wi-Fi and Powerline to connect their HD DVRs for VOD but in the end they decided to integrate MoCA – although it is worth noting that MoCA and the HomePlug Powerline Alliance entered a “formal liaison agreement” to combine their efforts by sharing information and working to further educate and inform outside parties about home networking – so in cases where coax is not available there might be a good chance Powerline might fill these gaps.

The cable operators however are starting to move in a similar direction and are expected to start pushing more advanced features – perhaps in some small part furthering their “TV Everywhere” concept). The process will likely focus on multi-room DVRs at first, before extending to other areas, but there is opportunity beyond muti-room alone (more on this in the last question).

Q: Which cable providers have committed to this? Or are you talking more about satellite and IP TV providers?

INOUYE: Currently Bright House, Comcast, Cox, and Time Warner have committed to use MoCA but in time I would be surprised to see a US based cable operator using a different technology for home networking. There is traction in the satellite market as I mentioned earlier (Echostar is also on the Board of Directors and they still supply Dish with most of their boxes) and Telco if you include Verizon as an IPTV provider.

Q: What other useful consumer features does Moca offer? Or what can consumers look forward to?

INOUYE: One of the companies I spoke with perhaps best summed up the progression – the first wave is creating ties to the pay-TV operators and enabling things like multi-room DVR. The next wave deals with IP distribution. Since networking technologies lend themselves to transferring data over IP this creates new opportunities to link other networked devices.

Before we get to this point however there are a couple of key milestones, if you will, that need to be met first. Content protection is paramount and one potential solution is DTCP-IP which is now included with DLNA - although the limited number of DTCP-IP supported devices in the field is creating some hesitation amongst the service providers of extending their in home networks to third party devices.

Although the PS3 through firmware update now includes DTCP-IP and if we consider the sheer growth in the number of TV models that are DLNA certified we can expect a far more amenable environment for moving IP content throughout the home in the not too distant future; in addition as more operators move towards gateway like devices this will further integrate the operator CPE into the home network.

It is important to note that MoCA has been incorporated into DLNA’s Interoperability Guidelines. Once the home is “IP ready” then we can expect more devices to start embracing networking technologies outside of Ethernet and Wi-Fi like MoCA. Connected TVs for instance could add MoCA and interface with the DVR or STB for additional content. MoCA could also extend into things like Home Automation. This could tie into the “TV Everywhere” concept – that is so long as a consumer subscribers to a particular pay-TV service then he/she would be able to watch related content throughout their home network, not just through the service provider STB.

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