T-Mobile Agrees to Buy Layer3 TV in Preparation for TV Service

T-Mobile Agrees to Buy Layer3 TV in Preparation for TV Service(bloomberg.com)

85 points by anarchimedes 8 years ago | 36 comments

> While most of the industry is trying to lure cost-conscious consumers by offering cheaper packages with fewer channels, Denver-based Layer3 has gone in the opposite direction. It sells an online-TV subscription with hundreds of channels that starts at $75 a month. Layer3 is betting there’s a market for consumers who are willing to pay a premium for TV that is delivered in high definition and is easier to navigate.

I don’t see how T-Mo succeeds at that price point when streaming w/sports + Netflix or Hulu is about half that cost.

cptskippy 8 years ago | |

Ar's article gives some additional information that sheds some light on why T-Mobile probably acquired them but still asks the same question you have in the end.

https://arstechnica.com/gaming/2017/12/t-mobile-promises-to-...

> Layer3 TV brands itself as "The New Cable." ... offering access to a wide range of HD and 4K channels (more than 275 in total), streamed using the highly efficient H.265 (also known as HEVC) video codec and a custom set-top box. It's a pure IP service—there's no tuner in the box, and it will connect over Wi-Fi—and to support it, Layer3 has built out a fiber distribution network and data center in Denver that handles transcoding shows into HEVC. It also has partnerships with Internet providers to provide the last mile connectivity. This private backbone network should mean that Layer3 doesn't suffer the kinds of issues that Netflix dealt with a few years ago when its links bought from Cogent became congested.

I suspect that T-Mobile is buying them for their technology and plans to scrap the current service offerings and try to offer an À la carte service. If they're able to do that it could be revolutionary but that's a big if. Most cable packages exist today because networks force their channels to be sold in bundles, you can't offer ESPN without ESPN2 or the Disney Channel.

Sling TV is allegedly À la carte but it's really just a basic cable bundle with the really crap channels excluded.

amyjess 8 years ago | | |

This sounds a lot like AT&T U-verse, which is technologically impressive.

jandrese 8 years ago | |

I cut the cord because my old FiOS TV service was just too damn expensive. Several months ago Layer 3 started sending me mail about their new service so I looked into it and found the same bloated bullshit expensive bundles that my old provider offered, and for about the same price. Maybe $10/month cheaper depending on what the rental fees and service fees and government fees and carrier fees and tax and so on work out to.

Needless to say their mailers have been going straight to recycle ever since.

If T-Mo can figure out this alacarte thing I might give them a second look. I'm not paying $90/month after fees for two channels that show maybe a couple of shows that I'm actually interested in. That's madness.

jbigelow76 8 years ago | |

I don’t see how T-Mo succeeds at that price point when streaming w/sports + Netflix or Hulu is about half that cost.

I pay a little over 50 bucks a month for Hulu's Live TV service but the interface and UX is absolute garbage. If I could get everything I get from Hulu Live with a real honest channel guide + easily managed cloud DVR I would pay an extra $25 a month and drop Hulu in a flash.

I'll definitely be giving the T-Mobile service a look as the only thing keeping me on Hulu is lack of good alternatives (I'm looking at you DirectTV).

deadmutex 8 years ago | | |

Have you tried out YouTube TV? https://tv.youtube.com

Disclaimer: I work at YouTube, but am not on YouTube TV team.

axaxs 8 years ago | | |

Curious...why don't you like DirectTV? It's the first service I signed up for...so I don't have much to compare. But the quality is excellent.

peterlk 8 years ago |

This seems like a big bet that the net-neutrality fight is over. Buying a TV service makes it much easier to prioritize your own content...

fjabre 8 years ago | |

It's become clear that the Internet as we know it was too vulnerable in its current configuration. We need the Internet 2.0 that is designed to be neutral from the ground up.

No one has solved the last mile problem because everyone was content to pay the ISPs and now look what's happened.

We need alternatives and we need them fast.

Dylan16807 8 years ago | | |

It's not hard to do at all. You can pass a law that forcibly unbundles the last mile, so dozens of ISPs can compete on even terms on the same wire.

And that's purely a political will issue, not a "we need to invent alternatives" issue.

jdavis703 8 years ago | | |

Internet 1.0 will be "good enough" for most people, so only geeks will be on Internet 2.0. That's not a bad thing, but the internet of today is a way nicer place to be than the internet of the 90s was. And the reason it's nicer is because basically everyone I know is on it.

f2n 8 years ago | |

Non-neutral wireless ISPs have always been legal in the US (IIRC). T-Mobile actively advertises their non-neutrality as a feature (eg "Binge On", where approved video streaming sites are zero-rated).

scarface74 8 years ago | | |

Binge on violated the letter of the law but not the spirit. No money changed hands and any legal video or audio content provider could be zero rated if they followed the guidelines. They didn't advertise it, but there was even a porn site that was zero rated.

If a new entrant came in, they would have been on a level playing field.

Feniks 8 years ago | |

Yep. And don't forget bundling.

Telecom operators do not want to be dumb pipes.

QAPereo 8 years ago | |

L. Bob Rife would be proud.

_cerv 8 years ago |

This is interesting as it presents T-Mobile with three new areas to make money in, existing license agreements, OTT video delivery, and the existing wireline infrastructure that Layer3 says they have. They saw Comcast get into their game, so they're going to get into theirs.

0xcde4c3db 8 years ago |

> a TV service that lets you watch "what you want, when you want, where you want"

I hope this means full on-demand and not the half-assed cable/satellite game of a broadcasting model with a DVR tacked on. I didn't become a cord cutter for the sake of a lower bill, but because I was spoiled by DVD box sets that I can (re)watch anytime at my own pace. Traditional channels are just grating to me now, and I have no idea why that model should be imposed on IP-based services.

paul7986 8 years ago |

Why didn’t they buy Dish which includes Sling TV. And a lot more spectrum?

I’m an ATT subscriber and with our data plan Direct TV Now is offered for a small added fee. GreAt svc and it allowed two family members to ditch their Comcast tv svc.

No Brainer other wireless carriers will follow.

maxsilver 8 years ago | |

> Why didn’t they buy Dish

They probably tried and couldn't work out an agreement. Dish is sort of infamous for being hard to work with, and has inflated the cost of their company by squatting on large amounts of spectrum they have zero intention of ever using. And that's all before getting into personality conflicts between both companies CEOs.

dawnerd 8 years ago |

I kinda wish they’d buy up frontier and get into the fiber market.

kevin_thibedeau 8 years ago | |

That would require taking on Frontier's dysfunctional management.

dawnerd 8 years ago | | |

Replace the lot of em.

smn1234 8 years ago |

I read this as T-Mobile agrees to buy Level3... imagine the shock that had

jpwgarrison 8 years ago | |

Same here, 2 seconds of "what does TV have to do with that" 10 seconds of "that's going to take 20 years to integrate those two networks..." and 4 seconds of "wait, would there be anti-trust issues" then I read more carefully.

geodel 8 years ago | |

Well CenturyLink already bought Level3 few months back.

http://news.centurylink.com/2017-11-01-CenturyLink-completes...

IceyEC 8 years ago | |

panic inducing!

gizmo385 8 years ago |

I think the title here should be updated to reflect that they're explicitly purchasing Layer3 TV, not the networking company that most people are probably assuming the headline is referring to.

bogomipz 8 years ago | |

The networking company is called Level 3.

gizmo385 8 years ago | | |

Yeah, total misread on my part there. They're pretty close in name and it threw me off.

Someone1234 8 years ago | | |

Indeed. Still an easier title to grep with the "TV."

anarchimedes 8 years ago | |

Agreed. It was the original BB title. Updated.