Ofcom UK Communications Report

Ofcom issued a 334 page Communications Report that discusses TV, Radio, Telecommunications, and convergence.

It has a lot of interesting information. Three points that stuck out were:

• More than a quarter of consumers (27%) claimed to use a DVR at the end of Q1
  2009, equivalent to 7 million homes, according to Ofcom research. This rose to
  nearly a third of consumers (31%) in multichannel television homes. These figures
  are a little lower than those from operator and sales data, which suggest that nearly 9
  million DVRs had been sold in the UK at the end of Q1 2009.
• High-definition television gained traction over the past 12 months, as new HD
  channels launched and more platforms developed their HD propositions. By the end
  of the first quarter of 2009, 2.3 million homes (9%) had reception equipment capable
  of accessing linear or on-demand HD content. Thirty-three per cent of UK homes
  claimed to have HD-ready television sets at the end of 2008, according to its
  research.
• Online catch-up TV began to enter the mainstream in 2008, largely thanks to the
  growing popularity of the BBC iPlayer. Twenty-three per cent of households claim to
  watch programmes online, rising to 33% among 15-24s. But 10% of people aged 65+
  reported that someone in their household watched catch-up TV online.

We should all thank Ofcom for continuing to publish these comprehensive reports that shed light on important trends.

Belgacom Adds 49K IPTV Subscribers in 1Q09

Belgacom added 49,000 IPTV subscribers in 1Q09 giving it a total of 555,000 at the end of the quarter. Of these it added 5,000 homes with more than one IPTV set-top box leaving a total of 70,000. The ARPU for its TV service increased from 19.4 to 20.4 euros during the quarter. Its IPTV revenues remained flat during the quarter at 13 million euros. Belgacom said that its IPTV service is now EBITDA positive. It spent 27 million euros of capital on its IPTV service for set-top boxes, content, and infrastructure.

Belgacom continues to be successful in a very competitive Pay TV market. The Belgian cable companies fell behind Belgacom in services and technology and are now paying the price.

BT Adds 45K IPTV Subscribers in 1Q09

BT added 45,000 IPTV subscribers to its BT Vision service leaving it with a total of 423,000 at the end of the quarter. It now has over 430,000 IPTV subscribers. It said that 90 percent of its new subscribers are taking a subscription and that its ARPU for the service has doubled.

BT is continuing to make progress in a competitive market. It appears that its strategy of riding on Freeview's coat tails is working well for it.

Telefonica Lost 7.7K IPTV Subscribers in 1Q09

Telefonica lost 7,700 IPTV subscribers in Spain in 1Q09 leaving it with a total of 604,800. It did ad 13,300 IPTV subscribers in its O2 operation in the Czech Republic, ending the quarter with 127,800.

Spain seems to be a difficult IPTV market. Telefonica has clearly lost its momentum in its home market.

Telecom Italia Added 36K IPTV Subscribers in 1Q09

Telecom Italia added 36,000 IPTV subscribers in 1Q09 giving it a total of 365,000 at the end of the quarter.

The pace of its IPTV subscriber additions slowed significantly from the rate that it achieved in 4Q08.

Swisscom adds 21K IPTV Subscribers in 1Q09

Swisscom added 21,000 Bluewin TV IPTV subscribers in 1Q09 giving 139,000 total subscribers.

Swisscom continues to make steady progress with its IPTV service.

France Telecom Adds 354K IPTV Subscribers in 1Q09

France Telecom added 354,000 IPTV subscribers across all of its operations leaving it with a total of 2.463 million at the end of the quarter. In France it added 257,000 IPTV subscribers, leaving it with a total of 2.166 million. Its Pay TV subscriptions in France grew by 240,000 in France ending the quarter with 1.138 million.

France Telecom added 12,000 subscribers in Spain, giving it a total of 99,000. It added 85,000 in Poland ending the quarter with 198,000 subscribers.

France Telecom is continuing to do well. Its operation in Spain has even started to increase again.

Telia Adds 22K IPTV Subscribers in 1Q09

Telia Sonera added 22,000 IPTV subscribers across all of its operations in 1Q09, leaving with with a total of 509,000 at the end of the quarter. The country by country results were:

• Sweden added 9,000 new subscribers, giving it a total of 333,000 at the end of the quarter.
• Norway added no new IPTV subscribers and ended the quarter with 10,000.
• Denmark added 1,000 new IPTV subscribers, ending the quarter with 2,000.
• Lithuania added 14,000, giving it 81,000 and the end of 1Q09.
• Estonia added 9,000 new IPTV subscribers, ending the quarter with 83,000.

Telia Sonera continued to have modest growth in its IPTV service.

Belgacom Considering New IPTV Middleware

Light Reading published an article saying that Belgacom is considering replacing its Nokia Siemens middleware. Light Reading thinks that Microsoft is the leading contender. The other major vendors supporting Microsoft are Arris/C-Cor for video on demand, Amino for set-top boxes, and Verimatrix for content security.

The Nokia Siemens middleware came from its acquisition of Myrio. Myrio's middleware was originally designed for the small U.S. independent telcos.

This is an interesting situation. It does not appear that Nokia Siemens has made the investment in the Myrio middleware to allow it to scale to meet Belgacom's needs and to support the next generation of interactive applications.

Microsoft's Mediaroom is an obvious candidate. I expect that Alcatel-Lucent will use its strong relationship with Belgacom to push the MyView middleware that it acquired from Telefonica. Thomson's middleware that is used by France Telecom should be another strong candidate.

It will be bad news for Arris/C-Cor, Amino, and Verimatrix if Belgacom its replaces Nokia Siemens middleware.

Liberty Global Interview

Light Reading has published an interview with Liberty Global that discusses the advantages of cable over IPTV in the European context. It sees that DOCSIS 3.0 gives it a large advantage over ADSL technology along with its long experience delivering video content.

These are good points but IPTV is giving cable a real run for its money in countries such as France and Belgium. IPTV is in a much stronger position in Europe than it is in most parts of the U.S.

Alice Brings Free up to 3.3M IPTV-Capable Subscribers

Free released an analysis of its 2008 results that stated that it has 423,868 unbundled subscribers as part of the business that it acquired from Alice, France. All of these subscribers can get free IPTV channels as part of their broadband service, assuming that they have an appropriate set-top box. Adding these Alice unbundled subscribers to Free's 2.900,000 unbundled subscribers give the company a total of 3,323,868 unbundled subscribers.

All of the Free unbundled subscribers have a set-top box that can receive its IPTV service. Free recently made a similar set-top box available to its Alice subscribers.

It is always interesting counting IPTV subscribers for Free. I think it is fair to count all of Free's 2.9M unbundled subscribers. How to handle the Alice unbundled subscribers is less clear. Today, I would split the difference. In another couple of years, I would count all of them.

Swisscom Adds 23K IPTV Subscribers in 4Q08

Swisscom added 23,000 new IPTV subscribers in 4Q08, ending the year with 118,000. The company had $US 129M in IPTV revenue in 2008.

Swisscom had a good year with its IPTV service in a competitive IPTV market. Its new fiber deployment should enhance its position nicely.

Belgacom Adds 63K IPTV Subscribers in 4Q08

Belgacom added 63,000 IPTV subscribers in 4Q08, giving it a total of 506,000 at the end of 2008. It stated that it had a 30 percent share of the Pay TV market at the end of 2008. It now supports a second TV in the home using VDSL. There were 65,000 customers with a second TV at the end of the year. It IPTV ARPU grew to 17.2 euros during 2008 largely through the improved success of on demand services. Its total IPTV revenue grew to 86M euros in 2008.

Belgacom offers HD services using VDSL, which is available to 64 percent of the Belgian population. The ADSL-based IPTV service is available to 86 percent of the Belgian population.

Belgacom is making good progress and is showing how other operators in Europe can succeed in a cable-dominated market.

BBC Canvas to Compete with BT Vision IPTV

The BBC is considering its Canvas Project that will compete with BT's BT Vision IPTV service.

The BBC is seeking permission to form a new joint venture partnership with other broadcasters and Internet Service Providers to define and promote a set of standards for digital television delivered via broadband Internet connections (IPTV) as well as digital broadcasts via DSat and DTT.

Users would need to buy a new set top box or other device which takes its broadcast signal from an aerial, like Freeview, or from a satellite dish, like Freesat.

Canvas users would also require a broadband connection to take advantage of on-demand features. They would need to:

• Subscribe to a broadband service which usually carries a monthly fee, or
• Utilise their existing broadband connection. It is possible they may need to
• upgrade their existing broadband packages to a faster connection, or
• upgrade their existing broadband packages to one which allows greater volumes of data downloads

The BBC said that Canvas would help protect the competitiveness of free-to-air platforms (like Freeview) and allow audiences who do not wish to pay for subscription television services to access a range of on-demand and linear services.

It wishes to develop Canvas in conjunction with the planned launch of HD services on the DTT platform (Freeview). Subject to approval, Canvas would launch at some point in 2010.

This is an interesting approach by a broadcaster to utilize broadband to reach its audience in addition to its over the air broadcasting. It looks very much like BT Vision to me. I wonder how BT will survive with this kind of competition from the broadcaster. This is a model that could be exported to other countries and create a new competitor to the existing Pay TV outlets.

Deutsche Telekom Adds 20K IPTV Subscribers in 4Q08

Deutsche Telekom reported that the number of Entertain IPTV lines activated climbed to around 353,000 by the end of 2008. The number of orders received up to this point in time were around 480,000. This was an increase in the number of IPTV subscribers of 20,000 in 4Q08.

It looks like Deutsche Telekom missed its goal of 500,000 IPTV subscribers by the end of 2008 by a large margin. The company seems to be struggling with creating a winning formula for the service.

Telecom Itallia Adds 111K IPTV Subscribers in 4Q08

Telecom Italia added 111,000 IPTV subscribers in 4Q08, giving a total of 329,000 at the end of 2008. It was able to achieve its objective of 300,000 IPTV subscribers at the end of 2008. Its IPTV service has now achieved a penetration of 4.9 percent of its broadband customers.

Telecom had a great fourth quarter. Let's see if it can keep up the pace.

Telefonica Spain Adds 23K IPTV Subscribers in 4Q08

Telefonica added 22,943 IPTV subscribers in Spain in 4Q08 ending the year with 612,494. The company stated that this gives it 14 percent of the pay TV market in Spain. Telefonica's O2 subsidiary in Czechoslovakia added 6,435 IPTV subscribers in 4Q08, ending the year with 114,496 subscribers.



Things have picked up a bit for Telefonica in 4Q08, which makes it one of the IPTV leaders in Europe.

Portugal Telecom Adds 101K TV Subscribers in 4Q08

Portugal Telecom added 101,000 Meo TV subscribers in 4Q08, ending the year with a total of 312,000. This includes both IPTV and satellite customers. Its Meo services offers 110 channels and 1,500 video on demand assets. The company stated that 45 percent of its IPTV customers have used video on demand are buying an average of 2.8 movies per month.

Portugal Telecom has included content from its Internet portal on the Meo TV platform, including news and geo-referenced information, such as traffic, weather and pharmacies onscreen The Meo set-top boxes are all HD ready, using MPEG4.

Portugal Telecom's TV success continues. It again added far more TV subscribers than broadband subscribers.

The company did not state how many IPTV subscribers it has. One of our readers said that IPTV accounts for about 2/3 of the total. This would give a bit more than 200,000 IPTV subscribers.

BT Adds 56K IPTV Subscribers in 4Q08

BT added 56,000 BT-Vision IPTV subscribers in 4Q08 giving it a total of 376,000 at the end of the year.

Subscriptions picked up a bit in the quarter. The market in the UK is quite competitive with a strong satellite service leading the pack. BT is facing a problem in delivering competitive HD services due to the relatively low speeds of its broadband services. It has not yet committed strongly to VDSL or FTTH architectures.

Free Up to 2.9 IPTV Capable Subscrbers

Free in France now had 2.9 million unbundled subscribers at the end of 2008, nearly all of who are capable of receiving IPTV programming on their Freebox gateway/set-top box. This is an increase of 534,000 from the end of 2007.

The company did not report on IPTV viewing. I believe that there are about another 150,000 IPTV subscribers that are part of its Alice France Telecom Italia acquisition. In my mind Free has more IPTV viewers than any other provider globally.