Sling Slides Into Echostar, Set-Top Box Field Narrows

Sling Media, Inc., makers of the SlingBox device that many consumers use to watch their home television shows or movies while on the road, has announced it's being acquired by one of its partners, EchoStar, which owns the Dish satellite TV network.

While the move, on surface, has generated disappointment that Sling's products may be subsumed into a walled-garden approach and only available for EchoStar customers, two factors seem to indicate otherwise.

First, Sling launched a content play last year, dubbed Sling Entertainment Group, which in turn generated several product ideas such as the Clip+Sling product that allows sharing of clips (and has been embraced, in the sports world, by the NHL but dissed by MLB). This content group is expected to become part of EchoStar, which would place clip sharing agreements as an additional service to the EchoStar network, but not mutually exclusive to satellite subscribers.

Second, and perhaps more importantly, the new Sling products are designed to work within a home, while the older products were limited to viewing outside the home. This provides EchoStar an opportunity to upsell its existing customers, but it would be foolhardy to assume that EchoStar would prohibit those who don't use its satellite service from purchasing these boxes—in much the same way that Cisco doesn't preclude its corporate partners from buying Linksys digital media products, although it doesn't overtly encourage the practice.

The second point seems to be borne on in the fact that EchoStar has petitioned the Internal Revenue Service to allow it to split its assets (including the new Sling products) into separate technology and infrastructure assets. To do this, the company proposes to spin off all technology assets as a company that would be separate from Dish, including set-top boxes dedicated to the Dish network, but also including the Sling products.

Like most acquisitions, however, this one has tongues wagging as to "Who's left that could also be acquired," despite the relatively low acquisition amount of $380 million.

While companies such as Focus Enhancements, who make both video delivery products and UltraWideBand chipsets that could compete with Sling's new products, might be a possibility, the name that pops up the most is Monsoon. Its Hava product is dubbed as a "wireless solution for high quality home viewing, multicasting and remote viewing." The product not only allows viewing of TV on a PC within the home (up to 300 feet) but also allows users to "transmit and watch video anywhere in the world via the internet".

Monsoon, though, has its own set of issues, somewhat unrelated to the market it's chasing. Apparently the company used open source software that had been released by a company called BusyBox, but didn't provide that information or follow the compliance guidelines until legal action was threatened. Monsoon announced recently that it has solved the compliance issue and would comply going forward, but the legal action has become a lightening rod in the open source community.

"I can confirm that we are discussing settlement," said Daniel B. Ravicher, legal director of the Software Freedom Law Center, the group leading the legal action against Monsoon, "but—contrary to what many in the press seem to believe—no agreement has been reached. Simply coming into compliance now is not sufficient to settle the matter, because that would mean anyone can violate the license until caught, because the only punishment would be to come into compliance."

One industry analyst noted that the publicity on this—apparently the first open source software case to go to court—may be a PR win for the open source community, as well as a marketing win for Monsoon, noting that they are gaining some significant publicity with this, and may use the publicity to leverage their way into marketing themselves as a credible place-shifting alternative.

More information will be available on this topic in an upcoming StreamingMedia.com podcast.

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