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Because most service providers don ’t have the resources to create content in-house, they are partnering with content developers and aggregators to acquire it. The trend points to carriers’ understanding that good content is critical to growing broadband networks and to attracting customers who otherwise might be satisfied.

Despite the calamitous dotcom pileup that left damaged content strewn all over the telecom highway, network gatekeepers have not given up on the idea of offering broadband-specific content to help differentiate the high-speed services they offer.

Service provider momentum in the content realm also has prompted those on the development and aggregation end to discern the delivery methods most effective for them.

“A lot of content developers just thought there were going to be lots of big pipes around they could get their stuff onto, and through some miracle they would get there,” said Gerard Kunkel, president of WorldGate Communications, a cable TV-based content distribution provider that offers high-speed data via TV. “You have to have a relationship with a distribution partner.”

The best way to become part of a carrier's service package is to partner directly with carriers or their content aggregators to present a unified, focused approach to broadband. For example, content developers must work closely with WorldGate to ensure what they build fits the TV medium. They also must be sure that what they produce is attractive and useful to the network operators so that those carriers aren't enticed to create their own content.

“Content is a tricky business,” said David Allred, vice president of broadband services for DSL provider DirecTV Broadband. “Our role is to bring the best of broadband to the subscriber. If that content is readily available, then I don't have much interest in creating it.”

Content development and aggregation efforts prevent service providers from developing content in-house—an expensive and impractical option. Most major carriers prefer to lean on content aggregators....

DirecTV Broadband co-brands with Yahoo to highlight, organize and present broadband-specific content to service providers. The company also is forging relationships with individual content providers to develop fee-based services that DirecTV will co-brand and offer on its membership site.

Media Station is one such premium content developer with which DirecTV Broadband is looking to build a relationship. Media Station President and CEO Jim Maslyn maintains that the companies that aggregate the “best types” of broadband content will rule.

Carriers that offer Media Station generally share the revenues, but those arrangements are still in flux, Maslyn said. “Carriers have to be a little more forward-thinking,” he said. “There are new business models, new technologies that have to be recovered in some of this stuff.”

Content development and aggregation efforts prevent service providers from developing content in-house — an expensive and impractical option. Most major carriers prefer to lean on content aggregators such as InfoSpace, which recently signed a deal with Verizon Communications. InfoSpace pulls its material from Web sites such as CNN and MSNBC, packages it on Verizon's Web site and manages the content relationships for Verizon.

“It's a way to let end users touch and feel those applications that will drive further usage of Verizon services,” said Steve Oroszlan, vice president of broadband business development for InfoSpace. Verizon chose InfoSpace after an earlier relationship with NBCi soured when the Web portal went dark, leaving the carrier in need of a quick but reliable fix. But despite the pains of its NBCi relationship, Verizon did not consider pulling content development in-house.

“Lots of people in a far stronger position to create this kind of Web portal have gone out there and had a very rough time of it,” said Mark Dillon, director of Verizon online's applications development group. “Our job is to take advantage of the resources that are there.”

InfoSpace currently is building an aggressive dial-up-to-broadband content package for Verizon designed to lure customers to broadband by demonstrating how much more broadband can give them.

Like Verizon, BellSouth is not developing content in-house. But it is aggregating its own content, said Tim Hill, director of portal services. Because BellSouth's broadband content, including streaming video and audio content, is noticeably better at higher speeds, it also encourages dial-up users to move to its DSL service. “We actually drive a lot of people over to see if they can get the broadband experience,” Hill said.

BellSouth licenses a platform from a company called Zip2 that it uses as its portal and creates the display layer that customers see when they go to its Web page. The carrier then uses content partners that can swing between narrowband, text-heavy offerings and broadband-hungry services.

BellSouth pays for its content in a variety of ways. In some cases it builds a co-branded service based on a recurring monthly costs instead of up-front costs. Sometimes it splits ad revenues and e-commerce with its content partner.

In contrast to BellSouth, ZoomTown.com figures content it makes available through its Cincinnati metropolitan area service is valuable enough to wall off. Non-subscribers get a different experience — and a different opportunity — than those who ride on Broadwing's high-speed networks, said Rob Pickering, ZoomTown.com's director of network development. ZoomTown acquires its own differentiating content — from providers such as Media Station, which aims at the Web's retail space via partnerships with merchandisers — to make its $39.95-per-month broadband service stand out. And as Pickering points out, that sort of content differentiation is increasingly important for carriers seeking to move their customer base beyond the early adopter stage and into the mainstream.

“The next wave of customers is going to be much more specific, looking for things that broadband brings them that they can't do on normal dial-up,” he said.

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