Canby Telcom Launches HD With IP Prime

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Oregon-based Canby Telcom has launched a high-definition video offering of 36 channels with MPEG-4 compression, using SES Americom’s IP Prime HD-4 service.

Although Canby is a small rural cooperative serving Oregon’s northern Willamette Valley, in 2005 it became that state’s first Internet-protocol TV provider. With the HD launch, Canby is the first operator in the state to offer high-definition content over copper.

The HD launch puts Canby in a better position to compete against satellite and gives it a leg up on its cable competitor, Wave Communications, which offers fewer high-definition channels than the telco, said president and general manager Keith Galitz.

Although Wave has yet to launch a phone product, Galitz believes it is only a matter of time before Canby’s triple-play bundle will be competing with cable.

Besides launching the HD services last month, Canby is also in the midst of what Galitz called “a fiber overbuild” in the most populous areas of its footprint, which will give it more bandwidth for additional services and strengthen its competitive position.

“We want to have 50 Megabytes into the home,” said Galitz.

Currently the 104-year-old co-op serves about 8,000 customers with phone, high-speed Internet, and video service. It operates about 10,000 phone access lines and has a 65% high-speed Internet penetration rate, said Galitz. He would not release video subscriber numbers.

When Canby began offering IPTV using MPEG-2 compression in 2005, the company believed they would have a window of three to four years before it would need to upgrade to MPEG-4 and launch HD content.

“By 2007, we found that with everyone buying HDTVs, our window had shrunk and the demand for HD was significantly accelerating,” said Galitz. “We made a decision to go with MPEG-4 in the fall of last year and began exploring how we could best deliver high definition television.”

Initially the co-op had planned to launch only 11 HD channels because of the high cost of encoders, adds Merry Shepard, manager of the company’s marketing department. Earlier this year, however, SES Americom’s IP Prime service began expanding its HD offering and Canby eventually inked a contract with IP Prime, a move that allowed it to launch a much larger array of HD channels than originally planned.

“It was an economical opportunity that allowed us to get much more bang for the buck,” Galitz said. “It is a very efficient and high quality solution that has allowed us to meet the consumer demand for HD.”

SES Americom’s IP Prime service offers a turnkey service targeted to smaller telco and cable providers that includes both technology and programming, with more than 200 standard-definition and 50 HDTV channels.

Canby, however, has negotiated all of its own programming deals and is also handling the encoding for about a quarter of the 36-channel HD lineup, with the rest coming from IP Prime.

Looking forward, the telco is exploring a digital video recorder product and talking to programmers about additional HD channels.

While the launch of the HD services has gone smoothly, Galitz and Shepard both noted that dealing with multiple vendors is a major challenge for smaller telcos sich as Canby.

“We have been using Siemens Myrio middleware, but we are exploring who we want to have as a long-term vendor,” said Galitz. They are also re-examining their potential set-top vendors, he said.

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