IPTV: challenges and opportunities

IPTV: challenges and opportunities

Developing a successful value-added service business is essential for future revenue growth for wireline operators. Of such services IPTV is currently one of the biggest opportunities, as it not only opens up the broadcast TV market to telecoms operators but also a whole realm of possibilities around interactive video services and applications, as well as adjacent opportunities such as advertising. IPTV has consequently become one of the most discussed topics in the consumer telecoms space over the past 12 months. This report highlights the major tends, opportunities, issues and threats faced by operators moving into this industry.

Table of contents

Executive Summary

IPTV content
IPTV driving next-generation access
IPTV and the connected home

2007: the move away from ‘me too’ content

IPTV services start to mature

Revenue opportunities

Continuing development of the IPTV supply chain

Is it all about advertising?

The coming of ‘over the top’

Case study: Verizon FiOS TV

FiOS network architecture
The FiOS transport network
The FiOS access network
FiOS TV service description and market entry positioning

Case study: France Telecom launches movie-making unit

Just a tourist, or a real co-production player?
Is this a true foray into content?

Case study: Joost
What the service offers
Strategy and business model analysis
Content deals: who is on board
Financial backing
Competitive environment

Content driving next-generation access

Higher and higher speeds
A step change: TV and video
Next-generation access: an expensive remedy
Branding has to shift as well

A long way to go in the connected home

No simple solution to ‘no new wires’
The rise of the games consoles
Cost of delivering broadband-enabled video to the home
Web service partnership

Adding the managed part

Remote access is the way forward
Where to draw the line?
Introducing advanced broadband support

Table of figures

Figure 1 IPTV subscribers by region
Figure 2 Average European incumbent wireline retail revenues
Figure 3 IPTV revenue by region
Figure 4 VoD revenue by region
Figure 5 IPTV services supply chain and functions
Figure 6 IPTV services supply chain activities
Figure 7 IPTV revenue share examples
Figure 8 Verizon FTTP network architecture
Figure 9 FiOS TV programming line-up
Figure 10 FiOS TV: key market-entry differentiators
Figure 11 Components and functionalities of Verizon FiOS Home Media DVR
Figure 12 Interface of Verizon’s Media Manager
Figure 13 FiOS: key competitive areas
Figure 14 Joost's advertising launch partners
Figure 15 Joost: major content agreements
Figure 15 Major content agreements (continued)
Figure 16 Overview of emerging Internet TV providers
Figure 17 Broadband subscribers by technology, 2006–2011
Figure 18 Worldwide consumer DSL subscriptions by speed
Figure 19 Western European consumer DSL subscriptions by speed
Figure 20 China-India region consumer DSL subscriptions by speed
Figure 21 Bandwidth requirements per application
Figure 22 Service bundles and bandwidth requirements
Figure 23 DSL coverage by region
Figure 24 IPTV via standard ADSL architecture
Figure 25 IPTV costs per customer based on Ovum’s independent cost modelling
Figure 26 Decreasing loop length, increasing bandwidth
Figure 27 Annual IPTV and VoD ARPU
Figure 28 UK telecoms market revenues 2005–2010
Figure 29 UK broadband market branding quadrant
Figure 30 The connected home and digital content
Figure 31 Connected home cost summary ($)
Figure 32 Call reduction due to Belgacom’s ‘Easy Install’ (BEI)