By J. Curt Hockemeier, National Cable Television Association
From the outset one-way addressable equipment manufacturers misunderstood the principal importance of their product to cable operators. The assumption they made -- that one-way pay-per-view would be wildly successful among cable viewers -- and that revenues from pay-per-view would easily offset the product's higher cost -- turned out to be a not insignificant leap of faith from early STV experience. This of course, has not yet been shown to be true.
The future of this new source of revenue is still unclear; however, there do appear to be economically attractive reasons to implement addressability if approached properly, whether or not the pay-per-view promise ever materializes.
The results of Cox Cable's studies of the technology, as applied to its own cable systems, suggest a formula for both making the addressable decision, and guidelines for getting the greatest economic benefit from addressability.