Wednesday, January 30, 2008
It looks like Deutsche Telekom now has its IPTV service on track. It should be able to achieve its goal of half a million IPTV subscribers in 2008. To be successful it must be sure that the price of its IPTV service is within the willingness to pay level in Germany.
Tuesday, January 29, 2008
Verizon now has 1.5 million FiOS FTTH subscribers, up 245 thousand in 4Q07. This compares to an increase of 226 thousand FiOS TV IPTV subscribers over the same period. Its FiOS Internet penetration is 21 percent of homes passed and its FiOS TV IPTV penetration is 16 percent.
Verizon clearly had a good year for its IPTV service. It would not surprise me to see it add another million IPTV subscribers in 2008.
ATT stated that it expects its weekly install rate to ramp to 40 thousand by the end of 2008 and to have more than 1 million IPTV subscribers by that time.
ATT should be congratulated for its progress in 2007. I for one was skeptical about whether or not it would achieve its stated goals for the year.
ATT's goal of 1 million IPTV subscribers by the end of 2008 would be a repeat of what Verizon achieved in 2007. It they let me know that it is available to me, I will be happy to make it 1,000,001 subscribers in 2008.
What was most apparent was that NSN appears to have done a good job of integrating its two parts over the last year and has developed a strategic framework that makes sense and is quite consistent with that of Nokia itself. The key tenet of this strategy is that 5 billion people globally will be accessing the Internet by 2015 and that they will generate a 100 fold increase in traffic by that time.
NSN made a couple of interesting points about this:
- While wireless speeds will increase significantly over that time, so will wireline speeds. Wireline systems will maintain its 100 times performance margin over wireless and will continue to generate 99 percent of the traffic.
- 70 percent of revenues come from voice. While total customer spending may double based on the use of new data based services, the cost/performance of network elements will have to improve significantly in order that the telecom companies can maintain profitability.
- Networks will have to become more energy efficient over this time as well. Most network energy consumption is in the access network.
I have gotten behind in posting a number of interesting year end results announcements over the last week. Blogspot would not let me make posts yesterday afternoon. Everything is working now, so I will get back on track.
Wednesday, January 23, 2008
This is a strategy that is used by many IPTV service providers in Europe. Its next step will be to offer HD IPTV services. Its FTTB network should be able to support that.
Monday, January 21, 2008
NPVR is a big issue between the broadcasters and the Telco IPTV services. NPVR is making progress in Europe but has been stalled by the broadcasters in the U.S. This is the first per view charging scheme that I have seen. This is a onerous approach that is likely to generate consumer resistance. A reasonable monthly subscription fee for unlimited access is likely to be a better approach if it is necessary to charge for the service.
Friday, January 18, 2008
The trial apparently will put some new customers on a metered billing plan. It could become a national offering if successful. It appears that customers who are part of the trial will be able to track consumption using a web tool and, if needed, upgrade to a higher tier.
There have been comments by executives of other cable companies stating that the industry will move to usage based offerings in general. Rogers in Canada already has a cap of about 90 gigabytes on its 18 mbps tier.
I expect that telcos want to use similar usage based techniques on their broadband services as well. Both the telcos and the cable companies are facing significant network expansions to support the increasing demand for broadband Internet bandwidth.
These caps are one technique that both telcos and cable companies can use to limit the use of these broadband services to deliver video content, especially to systems like Apple TV that connect TVs to the Internet. Rogers 90 gigabyte limit amounts to only about one hour of HD viewing per day. Clearly, both the telcos and the cable companies want viewers to watch their TV offerings rather than over the top Internet offerings.
Thursday, January 17, 2008
The MTS IPTV system was based originally based on Motorola VDSL access systems that it stopped actively marketing two years ago. MTS is also using Seachange video on demand systems and Widevine content security systems.
MTS plans to deploy the Alcatel-Lucent/Microsoft system on a limited basis in 2008.
It has been clear that MTS would change its strategy since Motorola ceased actively marketing its original VDSL systems two years ago. Its selection of Microsoft is a vote of confidence for Microsoft. MTS clearly understands the issues involved in offering IPTV systems and has decided that Microsoft can meet its needs.
Wednesday, January 16, 2008
- WiMAX and Broadband Wireless
- Mobile TV
- Telco IPTV
Apple's library will include 100 HD titles with 5.1 Dolby Digital surround sound. DVD-quality iTunes Movie Rentals are $2.99 for library titles and $3.99 for new releases, and HD versions are one dollar more.
With Apple TV, viewers can also view photos from their computers, Flickr and .Mac Web Galleries on their TV as slideshows or screen savers. As photos are updated on Flickr or .Mac, they are automatically updated on Apple TV. Apple TV viewers can now access the iTunes Store podcast directory of over 125,000 video and audio podcasts, view over 50 million videos from YouTube or choose from a selection of six million songs, over 600 TV shows and 10,000 music videos to purchase from their Apple TV. Purchases downloaded to Apple TV are automatically synced back to iTunes on the user’s computer for so that they can also be used on their computer, iPod or iPhone.
Apple is creating a service that may become a strong competitor to IPTV and cable video on demand services. Clearly, Apple will add more titles, but has a long way to go to compete with the 90 thousand titles that Netflix offers or the 6,000 titles that Comcast plans to offer.
Apple should catch up with Comcast's video on demand offering over the next months. Its real problem will be the delay caused by many broadband services, especially in the U.S. Even though Apple TV will support progressive download that allows the viewer to watch the movie while it is being downloaded, this may not work perfectly for SD content and may not work at all for HD content.
In any case, Apple is quite serious and is building what may become a popular method for watching on demand content on TVs.
Accenture's study shows that 49 percent of those surveyed believed that digital medial will become the primary form of programming and advertising content within five years. Accenture believes that new digital media are set to undermine the current TV based structure in the next few years by turning advertising into a two-way interactive experience for each consumer, and by ruthlessly highlighting the real performance and returns generated by campaigns
The study also shows that 75 percent of the respondents believe that the advertising agencies and the broadcasters have the most to lose in this transition. Accenture believes that those most at risk are the companies that do not embrace the new technologies and business models.
This is an interesting series of reports that highlight what the Telco IPTV industry must do in order to reach its full potential.
Tuesday, January 15, 2008
Telia Sonera passed 300,000 IPTV subscriber mark right at the beginning of 2008. There was also a big jump in movie rentals during the Christmas and New Year’s holiday period with viewers renting 68,000 films. The company plans to add additional TV channels, a wider range of films, and increased interactivity in the Spring of 2008.
This is an increase of 84 thousand IPTV subscribers in 4Q07 compared to 58 thousand in 3Q07. Telia Sonera is also seeing significant growth in video on demand. The company should see continued growth in 2008.
This is clearly a serious situation that needs to be addressed. ATT asked if they could put one of these systems in my front yard. I am glad now that my wife insisted that we turn them down.
This new service gives unlimited access to all of Free's thematic collections, including Cinema, Series, Music, and Children’s Entertainment. It will soon include access to a Manga theme.
Free Home Video Premium also offers a choice of HD content, including films, series and concerts. This HD content includes Pirates of the Caribbean, Die Hard: with a Vengeance, Con Air and others.
With Free Home Video Premium, Free users can also access a music video jukebox available on TV, which allows them to create personalised playlists.
Free is continuing to innovate with its IPTV service. This new subscription video on demand service with its emphasis on HD content raises the bar in France. I expect that Free's competitors will have to respond with similar offerings.
IPTV is now table stakes in the European broadband market. I do not think that KPN has any choice but to offer IPTV in order to compete in the Belgian IPTV market.
7. China Telecom
6. Chunghwa Telecom
4. Neuf Cegetel
2. France Telecom
1. Iliad (Free)
This list is consistent with our own rankings. Its criteria are a bit more strict than ours, which generates certain differences. We include Verizon even though it uses RF overlay to deliver broadcast content. Light Reading correctly points out that the smaller carriers such as TeliaSonera and Belgacom will not be able to maintain their position on this list for long.
We have published our own list in our report Opportunities in TelcoTV that goes into more detail about service provider and vendor rankings.
Monday, January 14, 2008
Qwest also stated that its resale of DirecTV satellite TV service has been quite successful and is quite satisfied with DirecTV as its video offering.
Qwest's strategy will give its VDSL subscribers significantly more Internet capacity than ATT's U-verse, which is limited to 6 Mbps today and 10 Mbps later in 2008. Verizon's FiOS can provide 15 Mbps today.
The questions with all of this is what the price will be. A FiOS 15 Mbps connection costs $65 per month today, which is pretty expensive. ATT has not announced its pricing for its 10 Mbps. I expect that Qwest will price its 20 Mbps service as a premium service that will put it beyond the budgets of many households. They can certainly sell it as a premium service and the additional revenue will defray the networking costs required to support HD streaming over its Internet service.
Friday, January 11, 2008
BT will offer wholesale access to this FTTH network with a service at 10 Mbps downstream and 2 Mbps upstream. 30 Mbps downstream and 100 Mbps downstream services will also be available.
BT is not planning a fiber overbuild at this time because it does not believe that this investment will produce adequate returns.
BT has been slow to upgrade its access network. The rest of Europe started moving to ADSL-2+ two years ago. The introduction of HDTV by satellite and digital terrestrial will put pressure for more bandwidth on the BT Vision IPTV service. ADSL-2+ will be an answer for those users close enough to get at least 15 Mbps, but fiber will be required in the long run.
Thursday, January 10, 2008
- The migration to digital technology will challenge the advertising industry in virtually all aspects of what it does — its business models, its culture, its customer relationships, and even how it is compensated.
- The advertising industry is not well prepared for the new technology.
- Advertising will move to three screen strategies that will encompass the TV, the PC, and the mobile handset.
- The new technology entrants such as the online search companies may have the most to gain from digital advertising.
This is an interesting set of reports that is well worth reading. All of this uncertainty is clearly creating opportunities for creative approaches and new entrants.
Monday, January 7, 2008
- DVR Anywhere that provides the ability to watch their recorded programs on any TV in the home. The viewer could begin watching a movie in the living room, resume viewing it on the kitchen TV during dinner, and finish watching the same movie in the bedroom. It will be possible to watch the same or different recorded programs from multiple TVs in the home simultaneously while recording other shows to be viewed later.
- NASCAR on TNT provides the ability to choose between several different live in-car driver cameras and driver audio, while simultaneously watching the main race.
- Showtime Interactive Boxing provides the ability to choose between several live audio feeds while watching the boxing match.
- CNN election coverage provides the ability to access the richness of CNN.com’s 2008 election coverage while watching CNN’s television broadcast and participate in interactive straw votes.
These are the kinds of capabilities that Telco IPTV needs in order to differentiate it from cable services, particularly in markets were cable services are particularly strong. The ability to provide advanced applications and capabilities is a primary reason why so many large service providers selected Mediaroom in the first place.
- ATT had 126 thousand IPTV subscribers as of October 2007
- BT Vision has 100 thousand IPTV subscribers
- Deutsche Telekcom announced its 100 thousandth IPTV subscriber in December 2007
This is a significant milestone for Microsoft. It does look like Microsoft has gotten over its technical hurdles with Mediaroom. Our report Opportunities in IPTV found that Microsoft is likely to become the leading Telco IPTV software supplier over the next few years. Microsoft appears to be following the track that we forecast for it.
In addition, Xbox users will also be able to download content through the Xbox Live Marketplace, which Microsoft began rolling out beyond the US last month, debuting in the UK via a deal with Warner Bros for movies.
I saw the Xbox 360 demonstrated with Microsoft's Mediaroom software at TelecomNext in June. It looked to me like a nice solution for the gamer with an Xbox who lives alone, but may be too complex for a family.
I asked about how easy it will be for other family members such as spouses or small children that want to watch TV but do not use the Xbox for gaming. My impression was that the gamer in the family could leave the system in a state (in the middle of a game, say) so that others in the home may not be easily to changed to watch a simple TV program.
I think that this is an irritation more than a fundamental flaw. I assume that the spouse will train the gamer on how to leave the Xbox after the first time that this happens.
This is another significant set-top box win for Motorola, which further cements the number one position that we stated that it enjoys in our Opportunities in TelcoTV report that we published a few months ago.