Disruption TV: JumpTV Scores B-

JumpTV is an Internet-based subscription TV service far from the mainstream, unless you are an immigrant from Turkey, Iraq, Romania or any of the 60+ countries from which JumpTV carries original programming.

The service is aimed at people far from home, eager to see home-country TV, with more than 200 channels to choose from. Individual channels range from roughly $5.95 per month individually to packages of up to 17 channels for $25.

I ran a Disruption ScoreCard  (more tools for managing disruption) on JumpTV and assigned the following categories with high grades:

• New customers: A (The niche immigrant market they are pursuing is underserved by cable and satellite;)
• Product inferior relative to mainstream TV: A (Streaming foreign programming on a PC vs mainstream broadcasts on cable or satellite;)
• Product superior to early adopter needs: A (Most of the channels are not available anywhere else except in the originating country.)
• New business model: A (Low-cost infrastructure. No fiber to the home etc.)

Analyzing the financials, available on a recent prospectus and financials, I was tough in assigning  grades for the following categories:

• Impatient for profits: C  (Losing money at an accelerating rate in recent quarters.)
• Investor profile: D (Looks like it may attract a hot money crowd in the IPO.)
• Plan to learn: C (Management says it priority is to build the infrastructure and sign up new channels, then aim for subscribers.)

Net result was a summary grade of B- (Some work ahead to get disruptive.) This is higher than the C grade Vonage earned, chiefly because of all the A's JumpTV scored for its unique market and original business model.

Here is the full Disruption Scorecard. Download jtv_disruption_scorecard_v2.xls
These sorts of evaluations are subjective. Feel free to challenge my input assumptions to come up with your own ScoreCard.

As an aside, the JumpTV management team includes Kaleil Isaza Tuzman and Tom Herman, stars of the 2001 documentary movie Startup.com, the story of an internet company that went bust. Here's a three-minute preview of the film, which attracted  good reviews, but not for management.

 ** Other Views/ Late Addition **

Financial Post: JumpTV leaps into a costly niche (pdf)

Full archive of On Disruption columns published in the Financial Post.

Telecom Consultant Mark Goldberg warns that IPTV, as envisioned by telephone companies, looks unlikely to be successful.  Partly the problem is technical, due to the bandwidth requirements for multi-channel HDTV, he says. As a result, Verizon plans to spend $20B on new infrastructure. "That is a brute force way to fight off the converged communications portfolio of cable. It is certainly one approach: replace the entire access infrastructure. There is another way. Change the rules of the game...Telcos need to disrupt the broadcast model because the alternative means fighting the battle using the cable industry's rules."

Mediangler says JumpTV's approach to the market is not new, but "that the money this time round is not necessarily in the technology. It is after all a cultural revolution...Other niche services are growing around the home - for example builder and contractor channels and VegTV for veggies."

New York Times announced the birth of the slivercast earlier this year, referring to JumpTV as a prime example.

PaidContent.org was doubtful of JumpTV when it wrote it up in January: "While there is certainly some business sense in this, the plans sounds gimmicky, if you ask me... B-grade channels at best."

JumpTV publishes its own blogs to build market awareness and a sense of community for different regions, including Africa, Middle East, Europe, etc.