NBC Universal CEO: OTT Is Not a ‘Real Business’

11 Sep, 2013 By: Erik Gruenwedel

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Steve Burke’s comments seem at odds with media company’s content license deals with subscription video-on-demand services

It may appear to be a Netflix world, with its 37 million subscribers globally and stock price through the roof. But to Steve Burke, CEO of NBC Universal, the business of over-the-top video distribution is apparently a non-starter.

“Personally, I’m skeptical over-the-top is a good business,” Burke told attendees Sept. 11 at the Bank of America Merrill Lynch 2013 Media, Communications & Entertainment Conference in Beverly Hills, Calif. “I’ve looked at it many, many times, and with or without high-definition, 4K or new technologies, I’m not sure [OTT] is a real business.”

The executive’s comments seem strange since NBC Universal for a while now generates incremental revenue licensing content to OTT services such as Netflix. The media company also licenses content to Hulu Plus (which it co-owns) and Amazon Prime Instant Video, among others.

Then again, he could have been referring to Xfinity Streampix, Comcast’s proprietary subscription video-on-demand service that allows the cable operator’s users to access back seasons of TV shows and movies on connected devices for a $4.99 monthly charge. Comcast has revealed little data on Streampix, including subscriber retention.

A NBC Universal representative was not immediately available for comment.

Meanwhile, Burke remains impressed with 4K resolution and its potential in home entertainment.

“The picture quality takes your breath away,” he said. “I have no doubt 4K is going to occur. To me the question is: How quickly can things go?”

The cable executive tempered his enthusiasm for the new high-definition format by remembering the time it took HDTV to take off and the disappointment of 3DTV. In addition, Burke said 4KTV prices have to come down significantly — a reality he admitted won’t happen unless there is consumer adoption.

“I would be very surprised if at some point 4K doesn’t become a very important part of the TV landscape,” the CEO said.

 

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