Floppyhead – Digital Media and Streaming

SageTV has been adding all sorts of media center features to its product line, including clear QAM support and HD media extenders. They are completely out-innovating Microsoft. With all the features they are delivering, there is one lingering problem: SageTV does not support digital cable tuners and CableCards (i.e. cannot watch.record premium HD cable content).

Currently, Vista Media Center is the only viable option for digital cable tuners (DCTs). Why is that you might ask? DRM, also known as digital rights management. CableLabs has made life very frustrating for the HTPC enthusiast by requiring all HTPCs with DCTs to be certified.

In order to buy/use a digital cable tuner, I have to purchase a pre-built system from an OEM vendor like HP, Sony, or Velocity Micro PC. Definitely a pain in the butt, not to mention expensive. This layer of DRM essentially has locked you into the Vista Media Center ecosystem.

No OEM is going to sell you a Sage product or BeyondTV product that can use DCTs. It currently does not exist and I will be very surprised if it ever does. HTPCs are definitely a niche market for nerds only. There is no market incentive for HP to offer SageTV on their machines when Vista Media Center is readily available. In order for SageTV to offer suport for DCTs, they have to be approved by CableLabs AND then convince an OEM to include them on their systems.

So what does this mean for Microsoft? Basically, they have a monoply of the digital cable tuner market (not including Tivo since it is not a PC-based solution). How many companies have the ability to deliver DVR software and convince vendors to supply their software? No matter what Microsoft does or how far they lag behind the market, you have to use Vista to watch cable premium content on your computer in HD. No competitor can match them on that important feature. All thanks to DRM. Not innovation or feature-sets, but content protection.

I wonder how much Microsoft has actually fought with CableLabs about its DRM-scheme. Publicly, they appear to be butting heads but privately, Microsoft has a lot to gain by being the only option on the block. Could Microsoft be using the iTunes/iPod model of vendor lock-in?