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  • 02-Sep-2009 by Alan Delaney
  • Reducing the cost of Pay TV leadership
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Reducing the cost of Pay TV leadership

The key to IPTV success is delivering a better Pay TV service than cable and satellite rivals while minimizing the total cost of ownership for television. Operators need great HDTV, VOD and time-shift services and they should enable content on every screen as part of an increasingly personalized TV experience.
 
The challenge is to introduce services and applications that are not just exciting, but which improve the bottom line. IPTV operators need to bring services to market quickly and customize them according to local market needs. They need to maximize Average Revenue Per User by making it easy for people to access new features and offers. Operators must also be able to meet consumer expectations for services that exploit the convergence of TV, broadband, voice and mobile.

For these reasons there is a growing interest in the impact that open standards are having in the IPTV market, and the benefits that more flexible applications and software development bring to operators. It is increasingly clear that to encourage innovation and drive prices downwards, IPTV ecosystems need to encourage vendor competition and champion operator choice.

In the television environment, IMS enables people to remotely control their TV services via personal mobile devices and enables the integration of entertainment and communications. It enables open Internet and managed network services to be delivered on the same devices. IMS also enables people to access content that is stored inside their home from any device and from any network outside the home, or transfer TV sessions between devices.

The use of Open IPTV Forum (OIF), IMS and other standards, together with increased operator choice, is enabling a paradigm shift in the way IP television is delivered. The arrival of IPTV middleware that is integrated with IMS is driving down the cost of deploying innovative applications for all IPTV environments.

Connected Home Gateway devices that embrace IMS, OIF and DLNA will help subscribers enjoy multimedia content on more home devices in a cost-effective way. Operators should look for gateways that enable the seamless sharing of content and services between DLNA-enabled devices including set-top boxes, games consoles, etc. Such gateways are increasingly relevant to cable operators too – enabling them to introduce IP in the customer premise and deliver cable video services to every screen.

Consolidation in the triple-play market and the increasing willingness of operators to use multiple networks including satellite, terrestrial and the broadband Internet puts the emphasis an openness and flexibility.

IPTV solutions need to deliver a step-change in the speed and cost of software and application development for all services, on non-IMS and IMS networks. A customizable TV Portal will put operators in charge of their own destiny, allowing them to use the real-estate of the user interface to offer promotions (like VOD) and possibly introduce advertising. Advertising, including addressable advertising with on-demand and mobile services, can provide a new revenue source for IPTV. HDTV and multi-stream HD will also provide a return on network investments.

IPTV providers can also expect higher subscriptions if they offer more catch-up TV. A next-generation Content Management System will support bigger on-demand libraries and make it much easier to change pricing and update promotions to maximize consumer interest. It will also allow operators to maximise the return on investment in their content by being able to repurpose it for multi-platforms. Open VOD platforms enable operators to choose their server vendors, exploit the latest technology and minimize cost per stream. They give operators the flexibility to grow their requirements as VOD consumption increases – future-proofing their network investment.

Operators can look to minimize CAPEX by leveraging standards and a multi-vendor strategy for their home gateways and other key components. They can also reduce costs thanks to unified and remote management of service provisioning and maintenance. The end result is that IPTV providers can boost revenues with advanced services without prompting a dramatic increase in costs.


About the author

Alan Delaney Alan Delaney, IPTV Business Development Director, EMEA & APAC, TANDBERG Television, part of the Ericsson Group

In his role as TANDBERG Television’s IPTV Business Development Director, Alan Delaney is responsible for building and maintaining the company’s relationship with telcos, operators and content owners in order to further the deployment and adoption of IPTV. Using TANDBERG Television’s award winning IPTV video head-end, on-demand and interactive TV solutions, Alan is able to provide IPTV operators with access to an extensive range of tools that allow them to introduce and drive new video business models.

Alan joined TANDBERG Television from Pace Micro Technology where he spent five years as IPTV Product Manager. During this period he developed and implemented a strategic business plan for the company’s IPTV services and maintained ownership of Pace’s IPTV product portfolio.

He holds an M.Sc. in Computer Science and Applications from Queen’s University, Belfast and a BA in European Business Studies from the University of Ulster.


Comments

Alan Delaney (09-Sep-2009, 15:2)

David, I agree that a la carte has worked in many markets, but I don’t believe it’s an option for everyone because of the need to give content providers minimum eyeballs and show critical mass on a channel for pricing and advertising. Whether this can work for an operator depends where you are in the business cycle and if you can deliver critical mass without bundling. Cable can offer a la carte too, so we think you need something more upon which to base long-term differentiation. Moving forwards, a-la-carte could be more about providing channels on different platforms, as well as giving people access to only the channels they want.

David H Deans (05-Sep-2009, 16:32)

Alan, given the success of PCCW in Hong Kong, the IPTV provider with the highest market penetration globally, isn't a-la-carte channel selection the proven way to differentiate IPTV offerings?

It would seem that continuing the practice of forced channel tiers is contrary to the fundamental notion of offering meaningful consumer choice and basic personalization capabilities.

David Deans
IBC Updates http://bit.ly/mfVp3

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