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Intel's online pay-TV service won't have al la carte pricing or lower your monthly bill

Intel’s online pay-TV service won’t have al la carte pricing or lower your monthly bill

When Intel’s move into the TV service arena was first announced last year, there was a lot of speculation that it would be the first TV service to offer a la carte pricing, finally “unbundling” TV programming by letting viewers subscribe only to individual channels, or even individual shows, they actually watched. But if la carte programming was Intel’s original intent, that idea has apparently been pushed to the sidelines after the company’s discussions with many of the industry’s largest content providers.

Instead, rather than eliminating bundles, the company will offer smaller, more flexible, “curated” programming packages that allow a higher level of customization by viewers. According to a report this week by Bloomberg, Intel is nearing content deals with several major players, including Time Warner, NBCUniversal and Viacom, and has begun more preliminary discussions with CBS, Disney/ABC, and Fox.

It also looks like Intel’s TV service won’t be be significantly cheaper. As the newest pay-TV competitor, Intel is likely paying more for its content deals, analysts say, which will affect the pricing of its programming packages. Instead of lower pricing, Intel is hoping that other differences—targeted, customizable program bundles that offer more choices than cable, a different approach to the TV interface and program guide, plus better, more integrated search and content recommendations—will appeal to users frustrated with the traditional cable TV experience.

There still aren’t a lot of specifics about the new service, which will run on Intel-supplied set-top boxes using a subscriber’s home broadband connection. The yet-to-be-named service will offer both live programming and on-demand content, as well as some sort of cloud-based “virtual” DVR. The company’s eventual goal is to move beyond the TV to deliver video service to all types of screens, including tablets, mobile phones, and computers.

While the set-top boxes will obviously run on Intel processors, it’s unlikely they’ll carry the Intel brand. We expect the hardware to have a unique, stylized look very different from the hockey-puck-shaped media streamers we’ve reviewed, such as those from Roku and Apple. And instead of H.264, the service will be use a newer, more efficient video format, called HEVC, that can provide better picture quality using the same home-network bandwidth.

It’s also been reported that the box will have one feature that may prove controversial: a built-in camera with face-detection technology that can recognize users and offer personalized content. While the camera could be used to make recommendations and serve as a webcam for social-media interactions, it also raises some privacy concerns, since it could also be used to send targeted advertisements to viewers. Based on what Intel has said so far, though, users should be able to shut the camera off.

Even if the new Intel TV is appealing, one thing it won’t do is provide an answer to the hotly debated topic of whether a la carte TV will actually reduce the cost of TV service. Some believe TV service would be cheaper if you had to pay only for the shows you actually watch; others, however, say that bills could rise if programming costs had to be borne by only those who actually watched them. (This is especially true with sports channels, such as ESPN, which can account for the largest single chunk of a monthly cable bill.) There’s also fear a that unbundling will reduce programming diversity, since shows or even channels that target smaller audiences or niche interests may not have enough viewers to support production costs.

We’ll be paying close attention to Intel’s planned TV service, and hope to give it a look once it becomes available.

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