“We've always positioned ourselves as an independent player in the connected TV space. We always believed there is a need for an independent player for all these TV brands—and there are around 500 unique brands worldwide—who are looking for an operating system,” says Ronny Lutzi, President EMEA at independent operating system creator ZEASN.

TVREV sat down with Ronny to discuss the current state of the TV operating system and where he sees independents like ZEASN fitting in. It’s included in our brand new Special Report, TV’s OS Wars:The Battle For Interface Dominance Part 1, available now as a free download.

ALAN WOLK (AW): Your company, Foxxum, is now part of ZEASN. Tell me about the new company and what the market should be aware of.

RONNY LUTZI (RL):  Over the last 10 years, we had a competitor, ZEASN, playing in the same field. We just thought it would be great to align our interests. So rather than competing for market share, we decided to team up with ZEASN and jointly conquer the operating system market. We are in a very good position because, if you look at operating systems, you have either huge digital media companies, or operating systems that are connected to the device. For TV makers, there are companies like Roku, Google, and Amazon, that are just so big, and they have their own agenda for the living rooms. That's where our advantage comes in – our long relationship with manufacturers, cost leadership on materials, and the fact that there is no threat of us competing on the hardware. We're free of government interests, and we've implemented a long-term revenue sharing model for TV brands.

AW:  From a consumer standpoint, what sets your products apart?

RL: From a consumer point of view, the UI/UX design of our WhaleOS is great. We work with all of the major content providers. Especially for an independent operating system, we have a very advanced new search functionality programmed on an LLM, a large language model. It's fascinating how it lets you casually talk to your TV. For example, ask your TV about a movie with jet fighter pilots and 'Danger Zone' as the theme song, and it'll suggest 'Top Gun' or 'Maverick'. This brings ease of use and discoverability for what you want to find in the masses of content available.

AW:  What is your pitch to companies considering Google or Amazon?

RL:  For TV makers, it's quite obvious. Google and Amazon repeat the same strategy: offer something for free, bring a huge number of users, then start coming up with new rules. They make the playground smaller, so to speak. Then, once the brand has massive reach, they start deploying their own devices. This raises questions for local TV manufacturers. These big companies make significant revenue once they're in the living room, while the TV manufacturer has to live with smaller margins. That's why we have a smart revenue sharing model with TV brands. Over the device's lifetime in the living room, the TV maker will participate in whatever money we can generate on the device. This can be from data or from ads, but we share that revenue with them.

AW: What region do you see most of your success coming from?

RL: Our focus is mainly outside the US and China. China is difficult to reach, and the US market is saturated with devices and operating systems. Our primary regions are Europe and Latin America. Europe is a good example of our success because it's a fragmented market. The US companies don't really grasp the local nuances in Europe. There are 27 countries, each with different languages, premium apps, and retailers. Understanding this fragmentation and local markets is where we excel. So, we're targeting around 500 TV brands that are strong in these local markets.

AW: What are some of the ways ZEASN is using generative AI?

RL: There are different levels to this. The initial use case is around discovery and understanding what the user wants to watch. Every query provides a lot of data. For example, if someone asks about 'jet fighter movies with Danger Zone,' it reveals a lot about their preferences and interests, possibly even their age. Every question helps build a virtual user persona. This aids in content discovery, personalizing the home screen, and even in ad targeting. It also opens up opportunities in areas like in-stream shopping. The remote control hasn't evolved much, but AI can significantly enhance the TV experience beyond traditional controls.

AW: Why is everyone suddenly so focused on the operating system? 

RL: Because the device itself doesn't really matter. It's like owning the only bridge to a city; whoever owns the bridge controls access. The operating system is that bridge in the living room. All revenue in the living room flows through it. There's a growing demand for an open, cooperative provider sharing the benefits. That's the position we're known for. Long-term, I see potential for OS consolidation. Big names like Google and Roku won't let go, but others might join forces or adopt platforms like our WhaleOS, enhancing strength and reach. We're also backing the WhaleOS Foundation, focusing on sustainability and environmental issues. We aim to be the 'good guy' in the industry. Additionally, operators are realizing the limitations of set top boxes. In the US, we're seeing a shift towards operators providing TVs with their own OS, a huge opportunity for us as an independent company. We can customize the experience, unlike our larger competitors. We're also planning to enter the US market, which has the highest monetization per living room.

AW: What is ZEASN’s role in what are being called the “OS Wars”

RL: Following our merger last year, ZEASN has become the largest independent player in the OS market by installed base. The industry increasingly needs an independent operating system. Several trends are driving this. Firstly, the TV sales market is under pressure. Average prices dropped by about 16% last year. Although sales volume remained stable, this was due to people upgrading to larger screens, rather than seeking new features. However, there's a natural limit to screen size determined by living room space. This means we'll likely see a decrease in sales volume soon.

Another trend is the response of cable operators to cord-cutting. They're trying to reclaim the 'glass' in the living room. Sky in the UK, for example, started providing TVs instead of just set-top boxes to customers. This strategy could become more widespread, which would impact TV sales in retail. Each TV supplied by an operator means one less sold in the retail market.

This puts TV brands under pressure to find new revenue streams. Monetizing viewing time in the living room is key, especially in the US. However, the current US operating systems keep most of the generated revenue. Our approach is different. We offer a long-term monetization partnership to TV brands, enabling them to sustain a business model beyond just basic hardware margins.

Download TVREV’s newest Special Report: TV’s OS Wars: The Battle For Interface Dominance, Part 1

This report, designed as a primer on the TV operating system and why it’s assumed such major importance, looks at how control of the OS means control over programming, advertising, data and more. In part 1 of the three-part series, we’ll look at how the “OS Wars” got started, what they look like from region to region and who the players are, with a look at independent operating systems like ZEASN, and where they fit into the ecosystem. Download your copy for free.