Jimmy Schaeffler

Cable: Get Ready For IPTV
May 2, 2007

Coming off the Internet Protocol TV issue discussed and debated at length during NAB, and now heading into the National Cable & Telecommunications Association’s 56th show next week in Las Vegas (May 7-9), broadcasters have weighed in, along with small telco and small cable operators. But a dearth of larger cable operators have yet to clearly stake their claim in the IPTV dialogue and marketplace.

Together with DBS providers DirecTV and EchoStar, many on the IPTV side also see the larger cable operators as “enemies” when considering the new IPTV world. These views picture IPTV as an infrastructure that delivers channels of linear long-form content to traditional television screens by way of the Internet. (Which is not to be confused with Internet video, which represents individual content packages chosen on demand by individual viewers and typically delivered via the Internet to computer monitors).

As an infrastructure, the natural implication is that this new IPTV infrastructure must necessarily conflict with the existing ones. Yet the truer measure of success will likely be seen among the Comcasts and Time Warners of the nation, which not only recognize the value of IPTV, but also embrace its virtues and values. The acceptances would include yet another infrastructure and yet another way to deliver a swath of bandwidth used to answer what will probably always be a multichannel operator dilemma: finding enough bandwidth to satisfy consumers.

Nonetheless, some important challenges remain. Every IPTV player must remain cautious of creating technology for technology’s sake, rather than a focus on the end experience for the end user. Users and subscribers simply want to push a handful of buttons on a remote control and see the content displayed. Yet, on a related plane, the complexity of the IPTV technology cannot be underestimated. Many a new player in recent years has misjudged the numbers (and costs) of these IPTV layers, causing business models to quickly go awry. A related issue is the importance of delivering expected video and audio quality from these new IPTV devices.

A second perennial concern of major importance is the proper mixture of subscription- and ad-based models. Because of its Internet-based origins, too many users, especially those born after 1983 (and thus hailing from Generation Y), do not either understand and/or accept the realities of making a business work, which often includes … oh my gosh, here it comes… charging a fee and making a profit!

Yet another scourge of dealing with the Generation X (i.e., those born a before 1983), is getting them to step away from traditional broadcast, cable and satellite TV programming practices and learn about and, again, accept new use habits, which IPTV offers and encourages. This will hold true for both vendors and viewers.

Finally, cable operators will have to be particularly careful so as to properly study and select the great number of offerings true IPTV can offer. Choosing the right ones creates a solid base upon which to grow others, yet choosing the wrong ones can dash the hopes of viewers (and their business purveyors) before they can even dream of great viewing, profit and/or maturity.

Looking at the schedule for the forthcoming NCTA Show, it is worth noting that the only IPTV session at focuses on IPTV in other lands than the U.S.A. Why? Is it because IPTV is still perceived as the enemy? Maybe this alone should have been a reason why it would not be included among cable constituents at a cable show, but perhaps the better view would be that IPTV is a new found friend to cable. Moreover, for a forthcoming show called ISCe, June 5-7 in San Diego, focused on Telco-Cable-Satellites, even though the number of panels and topics is few, one of a mere four total panels is focused only on IPTV, and mostly then, IPTV in the U.S.A. This IPTV panel in early June drills down into IPTV, domestically, and how it affects all providers in the multichannel marketplace, be they cable, telco, or satellite – small, medium or big.

Jimmy Schaeffler is chief service officer and senior analyst at The Carmel Group, a Carmel-by-the-Sea, Calif.-based conference organizer, publisher and consultancy. His company focuses on the digital multichannel industry.He can be reached at (831) 643 2222 or at jimmy@carmelgroup.com.

Posted by Jimmy Schaeffler on May 2, 2007 | Comments (0)