Home Analysis IPTV is dead; long live OTT-IPTV!

IPTV is dead; long live OTT-IPTV!

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IPTV services are generally those delivered by Telco’s (e.g. Orange TV, ATT Uverse) over managed networks with guaranteed quality of service. OTT services on the other hand are usually offered by content owners (BBC, Hulu) or dedicated start-ups (Netflix, Roku) over networks not managed by the service provider.

I gave my first IPTV presentation back in 2004. The first thing I did then was to define the term IPTV because no one agreed on what it actually meant. At the time it was opposed to WebTV not OTT. But as far as buzzwords go, IPTV had a pretty good run for its money, staying trendy for almost a decade.

Prior to this year’s IPTV show, I predicted on my blog that OTT would be the only common theme for the second year running. This year’s IPTV world forum was the biggest yet, yet it was the last. Next year the show is being rebranded. (Incidentally as the IP&TV rebranding never took, I wonder if the new TV Connect rebranding will fare any better; IPTV is still a strong brand name even if its old hat). The debranding of IPTV must be saying something. Has the great IPTV really gone for good, or has it just gone out of fashion?

Some say IPTV has failed because big Telcos that ploughed hundreds of millions of Euros into the technology have not recouped their investment. We’ve tried for years to convince ourselves (and investors) that IPTV was a sound defensive strategy. All the clever multi-play bundling was keeping customers from churning. Actually it was, it’s just that it only put a plaster on the wound without healing it first. IPTV is just a tool and teaching someone how to use a tool from another trade, doesn’t teach her how to actually make a living out of that trade. Belgacom is a very rare counter-example amongst Telcos – having put a real TV exec at the steering wheel; perhaps with PCCW, they are now the only Telco who can actually claim genuine IPTV success. Ironically much of their technology has recently gone obsolete as NSN, their main provider, has decided to drop IPTV products.

It’s probably significant that at the same time Siemens (not Nokia Siemens Networks, i.e. NSN) is making a big push back into the TV space, but with an exclusively OTT model.

So what has actually failed with IPTV is the Telco’s attempt to use TV to climb up the value chain. The technology itself needed a few years to have the wrinkles ironed out, but works very well now.

The market cap of any major Telco with a big IPTV offering, when compared with that of Apple or even Google, tells the same story. It will be interesting to see what happens to the TV adventures of Telcos like Telstra that have kipped the IPTV route, moving straight to OTT delivery.

Last year I wrote a successful blog entry on why France, having been the birthplace of IPTV, would probably also be its first grave. The article generated a thread of over a 100 comments on LinkedIn and I was quite pleased when offered an analyst spot at last year’s IP&TV forum.

My “the death of TV” analyst briefing was a learning experience. There were five other analyst tables and as doors opened, delegates came in and chose their table. The other tables were about fine things in the future (namely OTT) and most had about six people – one even had a dozen. Mine had none! So I’ve learnt from that marketing mistake: this article isn’t about IPTV’s woes but about OTTTV’s great potential ;o)

I believe it is simply a question of fashion. The current fuss over OTT is still about delivering TV through the Internet Protocol. If we didn’t suffer from a need for novelty all the time we’d be calling it IPTV because it still is.

Delivering video services OTT won’t kill IPTV. On the contrary it’s going to complement IPTV delivery and even help it by extending its reach. It’s an ideal technology for IPTV operators to delivery multiscreen or TV-anywhere experiences.

After a White Paper on Adaptive Bit Rate(ABR) in 2010, we’ve just finishing a White Paper on how OTT fits in with IPTV with Harmonic, Viaccess-Orca and Broadpeak. The white paper is now  available on Videonet and you can download the paper here: Key challenges & rewards to deploying OTT to complement IPTV and broadcast TV

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