Sunday, August 31, 2008

Deutsche Telekom Starts IPTV Promotion

Deutsche Telekom is offering its Entertain IPTV services is now available free for a two month test and can continue the service for 10 euros per month.

The company plans to add a radio service as part of the basic package and will broadcast Bundesliga soccer games with an interactive component. It will also offer Warner Studios films on demand as soon as they are released on DVD.

Deutsche Telekom has been taking an incremental approach to making its IPTV service more attractive. It would do better to bite the bullet and make a single dramatic move that will catch the market's attention. I think its best approach will be to bundle a basic set of IPTV channels into the broadband service rather than requiring an additional fee.

Comcast to Limit Internet TV

Light Reading published and article describing that Comcast will impose a limit of 250 gigabytes per month starting October 1. This threshold will apply to less than 1 percent of its high speed Internet subscribers, since the median residential usage is 2 to 3 Gbytes per month.

This limit seems reasonable for the web browser, even the person who uses a lot of Youtube. However, this limit will permit only about 2 hours a day of HD TV viewing. This means that Comcast is limiting the ability of its high speed data to access over the top TV services that compete with its cable service. This seems to me to be anti competitive. It will be interesting to see how the FCC reacts to this, especially as Internet TV becomes more popular.

Thursday, August 28, 2008

Chunghwa Telecom Adds 73K IPTV Subscribers in 2Q08

Chunghwa Telecom, the incumbent carrier in Taiwan, added 73 thousand IPTV subscribers to its MOD service ending the quarter with 508 thousand.

Chunghwa stated that its coverage of the Olympics significantly increased the viewing of its IPTV service:
  • The maximum number of households viewing its IPTV service increased by a factor of 1.6 compared to before the Games.
  • IPTV video on demand views were 3.3 times higher and Internet page views were 11.3 times higher compared to before the Games.
  • The number of video clips viewed, page views and traffic over its mobile portal “emome
    were 15.8, 10, and 10 times times higher, respectively, compared to before the
Chunghwa also added 148 thousand FTTB subscribers in the quarter, giving it a total about 800 thousand. It stated that 32.1 percent of its ADSL and FTTx subscribers have speeds greater than 8 Mbps.

Chunghwa continues to grow its IPTV service at a rate of at least 20o thousand new subscribers per year. Its Olympics experience shows the power of a big event in bringing viewers to the service.

Free's Has 2.9 million VOD Views in 1H08

Free released detailed information on its 1H08 results. There was no change to the information in my previous post. It did announce that it had 2.883 million video on demand and subscription video on demand views during the half compared to 1.874 million in the same period in 2007.

There were a few additional facts of interest:

  • Its ARPU remained flat at 36.3 euros per month during the half.
  • The percentage of its customers using Free as their only telecom provider increased to 71 percent at the end of June 2008 from 64 percent at the end of 2007.
Free's analysis is that Free, Alice, and France Telecom increased their broadband market share in 1H08 while Neuf Cegetel's share reduced. Free's broadband market share after its acquisition of Alice will be 25.5 percent. France Telecom had 49.6 percent and Neuf Cegetel had 23.8 percent.

Free is one of the most interesting broadband and IPTV companies around. It is worth taking a look at its presentation and report for the half.

Tuesday, August 26, 2008

Free Acquires Alice France

Iliad, the parent of the French broadband provider Free, has completed its acquisition of Alice France for 775 million euros. This price reflects:
  • A portfolio of about 850 thousand active subscribers
  • Loss carry forwards which will generate a tax savings of 350 million euros for Iliad
  • Cash and equivalents of 15 million euros
Free stated that this acquisition would return it to the position of the leading competitive broadband provider in France with about 4 million subscribers and a 25.5 percent market share.

This acquisition puts Free ahead of Neuf Cegetel, which achieved the leading position through a series of acquisitions. Free has set the standard offering for broadband in France with a complete triple play offering of 29.99 euros per month.

Frees next challenge is how to enter the mobile market. Both France Telecom's Orange and Neuf Cegetel's parent company SFR are major mobile operators in France.

PCCW adds 45K IPTV Subscribers in 1H08

PCCW, the incumbent Telco in Hong Kong, added 45 thousand IPTV subscribers in 1H08, ending the half with 927 thousand nowTV subscribers. It hat 932 thousand subscribers at the end of July 2008.

This includes 40 thousand new premium viewers giving it 668 thousand subscribers that are paying for premium services. This has increased its nowTV ARPU to $US27 per month.

PCCW provides 160 channels with 85 exclusive channels. It also offers an HD set-t0p box that provides access to the digital terrestrial HD channels. It also supports a second set-top box to its premium service subscribers.

PCCW's fixed line business has actually been flat or has increased since 2H05.

PCCW continues strong IPTV growth. Larger companies such as Verizon and France Telecom have surpassed it in terms of the number of subscribers, but it is the clear leader in terms of market penetration. It is also the leader in terms of business and content strategy. It has demonstrated how to turn a free service into a significant revenue generator.

Telekom Austria adds 10.5K IPTV Subscribers 2Q08

Telekom Austria added 10.5 thousand IPTV subscribers to its Aon TV IPTV service in 2Q08, ending with 49.1 thousand subscribers. Its broadband market share was 33.5 percent at the end of the quarter.

Telekom Austria is now fully into a commercial phase with its IPTV service. It has substantial competition and its TV service should help it.

FCC Orders Comcast to End Discriminatory Traffic Management

The U.S. FCC required Comcast to end its traffic management practices that discriminated against peer-to-peer traffic and BitTorrent in particular. The company has 30 days to:
  • Disclose the details of its discriminatory traffic management practices to the Commission
  • Submit a compliance plan describing how it intends to stop these discriminatory management practices by the end of the year
  • Disclose to customers and the Commission the traffic management practices that will replace current practices
This is an important aspect of the Net Neutrality argument. I believe that the crux of this issue is that broadband operators must take an even handed approach to how they manage traffic. They should not use these techniques to play favorites or to improve their own market position.

Hansenet to offer Free IPTV in Germany

Hansenet will bundle its offering of 70 IPTV broadcast channels into its broadband service. Up to now it offered IPTV for 9.99 euros per month on top of its broadband service. It currently has 20 thousand IPTV subscribers.

TV services in Germany are generally provide for free or at very low prices. This approach makes sense for Hansenet. It has been adopted with success in France, Sweden, and the UK.

China Telecom Selects Vendores

China Telecom announced the companies that its provincial operators should use for their IPTV services. For systems contracts, ZTE , UTStarcom, and Alcatel-Lucent were chosen.

For standard-definition set-top boxes ZTE, UTStarcom, Coship, Motorola, Huawei, Postcom, Sunniwell, Alcatel-Lucent, Yuxing, 30 Kaitian and Changhong. The provincial operators should give preference to these companies in the order that they are listed.

For high-definition set-top boxes ZTE, UTStarcom, Alcatel-Lucent, Postcom and Changhong.

The prices for terminal equipment have been set and the provincial operators are not allowed to renegotiate prices.

This should clear the way for China Telecom's provincial operators to ramp up their IPTV efforts. This is likely to significantly accelerate the IPTV services in China, which has basically been limited to the Shanghai area until now.

500 IPTV Blog Posts

This is the 500th posting to this Telco IPTV blog since January 2007. I started this blog to provide news and analysis on the Telco IPTV services globally. My intent has been to provide the most significant news items and add comments that put each item into perspective.

I thank everybody who has supported this effort by reading this blog. The audience is wide. There were readers from more than 90 countries in July.

I would like to hear your thoughts on how I can improve this blog. Please submit a comment and let me know.

Bob Larribeau
San Francisco, California
August 26, 2008

India Approves IPTV Rules

The Indian government has approved rules recommended by TRAI that allow broadcasters to provide content to IPTV services. This gives the IPTV providers access to broadcast content that is currently available to cable and satellite companies in India.

This approval creates a level playing field for IPTV, cable, and satellite in India relative to content. It sets the stage for a significant expansion of the IPTV services in 2009. The challenge is to put the broadband infrastructure in place that will be needed to support it.

Monday, August 18, 2008

Widevine to Protect CinemaNow Internet TV Content

CinemaNow selected Wdevine to protect the delivery of its Hollywood movies, TV shows, and music videos to consumer electronics devices and PCs. These consumer electronics devices will be sold in retail with CinemaNow's CE Store application and Widevine's content security software. These consumer devices include game consoles and Blu-ray disc players from major consumer electronics companies.

This move by CinemaNow will bring over the top IPTV content to the TV. This will create significant competition to the Telco IPTV services. The Telcos need to incorporate services like this with their IPTV service or be left behind.

I plan to test this service when I can get an attractive device to bring it to my TV. I will be deploying an 802.11n network in my home to get ready. I will let you know how it goes.

Saturday, August 16, 2008

Ericsson's IPTV Strategy

I spent a day this week at Ericsson's Analyst Relations meeting in Boston. Ericsson clearly intends to leverage Tandberg's strong position in the IPTV headend and content management markets. It also positions its Redback, Entrisphere, and Marconi acquisitions as giving it strength in IPTV networking and access.

Ericsson is also embracing the work of the Open IPTV Forum in developing an open approach to IPTV. The Open IPTV Forum is incorporating IPTV into IMS. Ericsson told me that it will be possible for existing IPTV middleware and other software component providers to adapt their products to theis Open IPTV architecture.

Ericsson characterized the existing IPTV systems as First Generation and stated that its conversations with IPTV operators indicate that they have strong concerns about the ability of these systems to scale. Ericsson told me that it thinks that many of these systems will top out at 500 thousand IPTV subscribers. It expects that moving to a second genreation of IPTV systems will create major opportunities for it.

There is no question that Ericsson is late to the IPTV party. Its acquisition of Tandberg clearly gives it a strong presence in the market but not as a full service provider.

It will be interesting to see if its view of the market will pan out. Personally, I think it will be much more difficult for Ericsson, or any other large full service system supplier, to break into the market at this time.

Friday, August 15, 2008

Telefonica to cut IPTV Prices in Spain

Articles in Variety and Expansió said that Telefonica will drop its IPTV pricing to 3 euros per month next Monday. It will offer a triple play bundle at 43.90 euros. Currently a triple play package costs 6.50 euros for the set-top box and 52.90 euros for a triple play package.

Telefonica's recent lackluster IPTV results have indicated that some action was required. 3 euros per month is not the same as bundling IPTV into a basic broadband subscription as is available in France and Sweden, but it is quite close. Telefonica is in a very competitive market. This move will help it and increase its IPTV sales.

Thursday, August 14, 2008

Portugal Telecom Jumps 70K TV Subscribers in 2Q08

Portugal added 70 thousand TV subscribers in 2Q08, giving it a total of 116 thousand subscribers. It states that it now has 6 percent of the 2.1 million pay TV subscribers in Portugal.

Portugal Telecom's TV offering includes both IPTV and satellite DTH services. It introduced IPTV in 4Q07 and its satellite DTH service in April 2007. The company did not provide the split of IPTV vs. satellite customers.

Portugal Telecom's TV strategy produced strong results in 2Q08. It is facing strong competition, especially in the urban areas where it only has 26 percent market share. Its TV strategy should help it regain momentum in these markets.

Wednesday, August 13, 2008

Swisscom Adds 16K IPTV Subscribers in 2Q08

Swisscom added 16 thousand IPTV subscribers in 2Q08 giving it a total of 80 thousand at the end of the quarter.

Swisscom's IPTV subscribers adds picked up in 2Q08. It appears that its new marketing effort has had some effect.

Tuesday, August 12, 2008

Singtel Adds 2K IP Subscribers in 2Q08

Singtel added about 2,000 new IPTV subscribers to its mio TV IPTV service which brought the total to more than 45 thousand at the end of 2Q08. The number of new subscribers was offset by the loss of subscribers that did not renew after the original promotion period expired.

Singtel has a deal with Disney-ABC International Television, Twentieth Century Fox and Warner Bros. International Television Distribution, that makes it possible for its mio TV service to screen over 50 top US series as early as 24 hours after their US premiere.

Singtel is experiencing the same problems that other service providers have had converting introductory promotions to long term subscriptions.

Sunday, August 10, 2008

NDS Vision of the Future

Broadband TV News published and article describing a conversation with NDS about its vision of the future of TV delivery. It discusses approaches to pushing content out to DVRs using content security software to insure that digital rights are enforced. The article also discusses approaches to personalized advertising based on push technology. It states that people will be shown different ads on different TVs in their home.

It has been clear for a long time that content security software is key to the delivery to a number of new services, especially push services. It seems to me that Netflix will move to this kind of model replacing postal delivery with push technology.

Saturday, August 9, 2008

Tele2 Netherlands adds 10K IPTV Subscribers

Tele2 Netherlands added 10 thousand IPTV subscribers in 2Q08, giving it a total of 247 thousand. This is less than the 12 thousand that it added in 1Q08.

It appears that Tele2's IPTV service is flattening. The Netherlands has a very strong cable provider and IPTV has been struggling there.

Friday, August 8, 2008

Telecom Italia adds 44K IPTV Subscribers in 2Q08

Telecom Italia had 180 thousand IPTV subscribers at the end of 2Q08, and increase of 44 thousand in the quarter and in increase of 100 thousand in 1H08. It is maintaining its target of 300 thousand IPTV subscribers by the end of 2008.

The company added 337 thousand broadband subscribers in 1H08 giving a total of 1.653 million at the end of the half. It did not announce any IPTV numbers for its Hansenet subsidiary in Germany.

Telecom Italia is continuing to add IPTV subscribers. Its rate of increase is low considering the number of its broadband subscribers and the lack of cable in Italy. I believe that it is still number two in IPTV in Italy to FastWeb.

Its goal of 300 thousand IPTV subscribers in 2008 appears possible but will require it to accelerate its sales rate.

FastWeb Adds 60K Broadband Subscribers in 2Q08

FastWeb, the competitive carrier in Italy, added 60 thousand broadband subscribers in 2Q08 (135 thousand in 1H08) giving it a total of 1.398 million subscribers. It had no comments on the number of IPTV subscribers that it serves.

The company plans to offer a 100 Mbps fiber offer to small and medium enterprises in 4Q08 at a premium price, and will extend this to the SOHO and residential market after the end of this year. This is an upgrade from its current 10 Mbps service. It expects this higher speed service to lower churn and stabilize ARPUs.

FastWeb stated that its fiber service passes 2 million homes in Milan, Turin, Genoa, Bologna, Roma, Naples, and Bari. It stated that this is higher coverage than any other European country. Fastweb's 243 thousand fiber subscribers is nearly 25 percent of all of the fiber subscribers in Europe.

FastWeb will introduce mobile services in Italy in September 2008. It will focus selling the service to its current customers in October and launch it to the business market in 4Q08. It is currently evaluating a mobile offering to its executive customer base.

As usual I interpret the lack of an announcement of IPTV subscribers to indicate that there was no significant increase during the quarter.

ATT Introduces Interactive Fantasy Football on IPTV

ATT announced the launch of Yahoo! Sports Fantasy Football on AT&T U-verse TV. Viewers can use the interactive AT&T U-bar to track their fantasy football team and receive customized information on their favorite NFL teams on their U-verse IPTV service.

AT&T U-bar is an interactive feature available to U-verse TV customers that allows viewers to receive customized sports, weather, stock and traffic information on their TV. Yahoo! Sports Fantasy Football is one of several U-bar enhancements now available to U-verse TV customers at no extra charge.

Fantasy football enthusiasts can also purchase StatTracker®, a real-time application that tracks player, team and league statistics, for $9.99. StatTracker delivers snap-by-snap updates to users via AT&T U-bar, personal computers and mobile devices.

AT&T is taking advantage of its IP network to differentiate its IPTV service from its cable competitors. Sports is important to many viewers and is a good place to start these services.

Thursday, August 7, 2008

Deutsche Telekom Has 200K IPTV Subscribers

Deutsche Telekom announced that it has 200 thousand subsubscribers using its IPTV service with 250 thousand signed up at the end of 2Q08. This is an increase of 46 thousand in the quarter.

Deutsche Telekom growth in the first half has been rather modest. It will have to significantly pick up the pace if it is going to meet its goal of having 500 thousand subscribers at the end of 2008.

Tuesday, August 5, 2008

Cablevision Wins NPVR Ruling

Lightreading published an article about Cablevision winning an appeals court ruling that supports its NPVR service. The ruling allows Cablevisiion to offer its NPVR service that was blocked by a law suit by major U.S. TV networks and film studios. Cablevision has not announced any plans to restart the service.

This ruling is subject to an appeal to the U.S. Supreme Court. NPVR is a key feature for the cable and Telco IPTV services in the U.S. NPVR is needed to bring the personalization that viewers get from the Internet to the TV. It will also have a profound effect on the networks that support IPTV services.

Monday, August 4, 2008

Olympic IPTV Boom in Shanghai

Due to its replay function that provides access to programs aired in the past 48 hours, subsciptions to IPTV, are booming in Shanghai ahead of the Beijing Olympic Games. China Telecom has received about 3,000 IPTV subscriptions every day, the most in its history.

The number of IPTV users in Shanghai has reached 510 thousand and is expected to hit 800 thousand by the end of 2008. BestTV, the IPTV unit of Shanghai Media Group, said it would promote a new service during the Olympics that enable viewers to watch different sporting events on different windows on one screen.

Shanghai Media Group provides two HDTV programs that are being viewed by more than 20,000 users. About 300 thousand Shanghai broadband users can receive this HD service,''

The company is facing the problem that the installation of wiring to support IPTV can sometimes damage the interior of people's.

This is another example of how sports content can significantly increase the subscription of IPTV services. It is interesting to see that HD has started to penetrate in Shanghai.

Free Adds 93K IPTV Subscribers in 2Q08 (Corrected)

Free, the competitive carrier in France, added 93 thousand new broadband subscribers in 2Q08, giving it 3.134 million at the end of 2Q08. It had 2.614 millionunbundled subscribers at the end of the quarter. Its penetration of unbundled subscribers increased to 83.4 percent at the end of 2Q08 compared to 81.5 percent at the end of 2007.

During the second quarter Free added the following to its service:

  • 802.11n support to its Feebox HD set-top box
  • Pre-release of Canal+'s catch up TV service
  • M6 HD and France 2 HD
  • Promotion that provided a one year subscription to the Canal+ Le Bouquet premium package for 1 euro per month
Free has closed its debt financing syndication that will enable it to acquire Telecom Italia's Alice France broadband operation. This acquisition should increase the number of its IPTV subscribers by another 80 thousand.

I estimated that virtually all of Free's unbundled subscribers are capable of receiving its IPTV service. This gives it a total of 2.6 million IPTV capable subscribers.

I found that I confunsed end of 2007 figures with 1Q08 figures in the original post.

Sunday, August 3, 2008

BSNL in India to Delay IPTV

BSNL, the state run telco in India, will delay its IPTV launch for a year in Kolkata, Ahmedabad and Bangalore. Recent rulings now enable it to establish agreements directly with the major content providers in the country. It has had poor response to the trial that it has been running with IOL in Bangalore. IOL aggregated content on its own. It is now acquiring its own IPTV infrastructure equipment.

The IPTV situation in India is still rather clouded. The fundamental problem there, though, is the lack of broadband infrastructure. IPTV will not do well there until broadband services are broadly available.

Saturday, August 2, 2008

Telekom Austria at 50K IPTV Subscribers

Telekom Austria now has 50 thousand IPTV subscribers, this is up 11.4 thousand from the end of 1Q08.

The company is running a summer promotion that provides the aonTV basic package free for the first six months. Subsequently, there will be a charge of 4.90 euros monthly in addition to the broadband line starting at 15.98 euros per month. During this promotion the first set-top box costs 29.90euros .

The basic package has 65 TV channels. For 7.90euros per month the Premium TV package offers an additional 21 entertaining channels such as National Geographic, Disney Channels, E!Entertainment and kabel eins classics. For The aonTV video on demand library has up to 300 films. Films in HD quality, time-delayed and ORF information programs that can also be viewed on demand.

Telekom saw a bit of a slow down in 2Q08, but its summer promotion should help it get through the summer doldrums.