Another big differentiator is that there are a lot of software. We’ve got the media processor and very powerful electronics inside but the whole integration is done through software. There are broadcast solutions, on-demand content, a slick UI, support the variety of formats and codecs. In the last two years we have seen H.264 video compression standard. But when we started we had Windows Media, Real Format, MPEG-2, MPEG-4, H.264. So another challenge was to be able to tell the content providers that you bring the media in any format. So integrating all these formats is in itself a great challenge.

Q.What are the latest trends in this field? Can smart TVs integrate your whole product into them and how has competition like Apple TV and Google TV affected you?
A. Technically Smart TVs can integrate our device into them. But when we do that we have to balance out the benefits in order to make successful business out of it.

Fact is that TV margins are already very thin. So if we add another component in it, you have to balance the economics of it based on how much value it gives. On one hand, the value addition might attract more buyers to the device. On the other hand there is the risk that consumers may return the product because one component may not work. This risk increases with TV complexity. So if you bought a 35000 rupee TV and if one component worth a few thousand rupees is not working the consumer will definitely return the product. In an industry that survives on such low margins, the product returns might break the company.

However, you could see this function coming in premier TVs where the cost also includes a premium for the advanced technology that the device integrated within it.

Apple TV has not affected us because it is a closed product. To get content you have to sign into the iTunes Store. In our case you have the choice to gain content from us or from any of the other content providers or you could even open a content store yourself. In some ways, Apple TV did a lot of good and bad to the industry. For a non-techy consumer, they sold the concept that you could take a device and you could attach it to the Internet and it just works. That was the good part. The bad part was that it didn’t seem like a mainstream product for Apple, Steve Jobs even called it a hobby right. So people didn’t attach a sense of failure to that product. But the net of it was positive as it created a lot consumer awareness about it.

Google TV is also very similar. A lot of people from the outside look at Google TV as a failure. Technically, they did a very good job. In the TV industry, what we have learnt is that it is all about user experience. Microsoft has been trying this from 1998, after they bought a company called webTV. If you have designed in your mind to look at the TV as a browsing device, then it’s not going to work in this generation. TV users do not like a lot of interactivity, this whole concept of witting in front of your TV with a keyboard is very alien to most people. TV watching is by far still a passive experience. When GoogleTV came out they focused on the integrated search experience – you could search for content from the Internet or the cable operators- it was technically impressive but there was a huge change in the user experience. I personally don’t believe that any change of that magnitude will happen very quickly.

Q. What is VuNow?
A. VuNow is the name of our complete platform. You have got to understand that we are not just a box company. Even though there is a significant amount of IP in the box, it also talks to a head end on the Internet. So this whole cloud service that manages the content completely comes from us. The whole system is called the VuNow Internet TV platform, which is what our customers take from us. They go to end users with different brand names for the box.

Q. Is everything done in-house?
A. All the hardware development is done in-house. Manufacturing is not done in-house, we outsource it to China and Taiwan. All the software development is also done in-house. Of course, there are bits and pieces of technology that we may have to license from other companies. For example, Windows Media is from Microsoft. So we have to license it from Microsoft to use it.

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