Fanhattan unveils radically different approach to cable boxes

San Mateo-based Fanhattan unveiled a pay-TV receiver Thursday that tries to solve three problems that have vexed the TV industry: fragmented programming sources, incomplete program guides and overly complex remote controls.

Unlike the squat, industrial set-top boxes that cable and satellite companies distribute, Fanhattan's "Fan TV" device is polished and rounded like a river stone or something out of a Zen garden. In short, it's a potential breakthrough in function and design.

Fanhattan won't have the chance to test Fan TV's appeal with consumers, however, unless it can sell its vision to the pay-TV companies that dominate the market. That's because Fan TV will be offered only in cooperation with pay-TV partners, although Fanhattan intends to sell the device through retailers.

Unlike a conventional cable or satellite receiver, Fan TV is a stripped-down computer that tunes in programming through a broadband Internet connection. It also will integrate online video-on-demand from companies such as Netflix, Amazon and Vudu seamlessly with the pay-TV operator's own video-on-demand services. And instead of a button-covered stick, its remote control is a touch-sensitive pad that sits in the palm of one's hand.

Fanhattan Chief Executive Gilles BianRosa is borrowing a page from Apple's iPhone playbook, hoping to persuade pay-TV companies to embrace a device that could change their business model. (The look of the device, which was designed with the help of Yves Béhar of fuseproject, also evokes Apple's sleek products.) To do so, he'll have to get them to do several things they've long been reluctant, or even unwilling, to do.

For starters, Fan TV changes the user interface of pay TV dramatically. Instead of the familiar grid of channels and time slots that defines the current generation of program guides, it presents a modified version of the Fanhattan website and iPad app.

Users start by picking a type of programming to explore -- movies or live TV -- then browsing by genre, scrolling through favorite channels or programs, seeing what's trending, or viewing what their Facebook friends have recommended. They can also search for a specific title.

Users will still be able to browse live TV offerings by scrolling through thumbnail pictures and descriptions of each channel's current offerings. But the idea behind the guide, as with Fanhattan's website, is to break out of the confines of the TV grid and make it easy for people to find something they'd like to watch, whatever channel or online service might offer it.

For example, if users looking at the TV offerings should click on a link to "The Walking Dead," Fan TV will display links not just to episodes that are airing at the moment or in the near future on pay-TV, but also to four different places online where they can find episodes from the first two seasons, and three sources of episodes from Season 3. Clicking on any of those links, in turn, launches a player from that site for the user to watch and, if necessary, pay for the episode.

For years, cable operators resisted efforts by consumer-electronics companies to replace the former's program guides with a guide built into a TV set or retail set-top box. They particularly disliked the idea of guides that would offer alternatives to their own video-on-demand services.

That resistance, BianRosa said, is giving way to the realization that consumers will go elsewhere for their entertainment if their cable operator makes it too hard for them to find something they want to watch.

They've also started to see online on-demand services as complements to their own programming, not competitors, BianRosa said, because there's a limited amount of overlap between what's on live TV and what's available online.

That may be true, but there's also a limited number of hours that people are willing to spend in front of a TV set. Every hour spent watching "Arrested Development" on Netflix is an hour not spent watching advertiser-supported channels, pay-per-view movies or other cable programming whose value depends on the size of its audience.

One other unusual feature of Fan TV is that when users record a program, it's stored in a virtual locker online. That approach, similar to Cablevision's network-based DVR, is legally controversial; Hollywood studios argued that Cablevision's approach violated copyright law, but the U.S. 2nd Circuit Court of Appeals disagreed.

The big advantage for consumers, though, is that they could watch recorded shows on any Internet-connected device running Fan TV software.

Fanhattan is relying on its pay-TV partners to set up the virtual DVRs, just as it's counting on them to cut deals with studios to allow them to transmit their shows through the Internet.

The shift to broadband delivery could reduce the picture quality of a pay-TV service if subscribers don't have ample bandwidth in their broadband connections. But it has at least one other important benefit for consumers: It makes it possible for a company such as Fanhattan to sell a receiver that could work on any pay-TV system offering Fan TV, without relying on plug-in cards to unlock the programming.

There are signs that the TV industry is moving in Fanhattan's direction. Time Warner Cable recently unveiled an application that enables subscribers to replace their cable boxes with Roku's set-top boxes, adding cable channels to Roku's lineup of online on-demand programming.

Roku has yet to develop a program guide like Fanhattan's that integrates TV shows with online offerings, however. And Microsoft's forthcoming XBox One is intended to deliver all aspects of home entertainment through one device.

Yet Microsoft and many others in the consumer-electronics business have been talking for years about consolidating the profusion of devices in the living room into one all-purpose box, only to trip over hurdles put in their way by pay-TV operators. That's one reason the typical home has more remote controls than occupants.

By the way, the Fan TV remote is one of those forehead-smacking leaps in simplification that makes you wonder why every other company isn't doing things this way.

By sliding a thumb left or right, up or down across the surface of the remote, users navigate through the menus Fan TV displays on the TV screen. Tapping the surface selects an item or operates the on-screen playback controls. Sliding two fingers up or down raises or lowers the volume.

The company has yet to announce any pay-TV partners for Fan TV, or indicate how much the device will sell for. BianRosa said he expects to announce both later this year, adding that Fan TV "will be a lot less expensive than what you're paying your cable company to rent that set-top box every month."

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Healey writes editorials for The Times.

Twitter/@jcahealey

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