Bill DoddPresident & COO
HEAnet, Kilkenny, IrelandNovember 10, 2006
IPTV and the Triple Play: Challenges and Opportunities
What is Internet Protocol TV (IPTV)?
• Video delivered to a device using IP data packets
as the transport stream
• It is not TV delivered over the Internet in a
manner similar to cable or satellite because it is
a switched network
• Point to point connection to the multicast
source, whether it is using the public Internet or
private fiber transport
• Can be viewed on most any device capable of
displaying a video signal
• Can be a highly secure, operator controlled
network – end to end
Why is IPTV Relevant?
IPTV market emerging at very rapid pace
– 72 million IPTV subscribers worldwide in
2010 - nearly 25 times the 2005 figure
– Representing over $200B in market value at
today’s cable multiples
– Most all major worldwide telcos to deploy
IPTV over next 12-36 months
– Telcos must deliver on their promises to the
investment community, which translates to a
very big need for innovationSource: 2005, IDC
YouTube sells to Google for $1.6 Billion
Many Approaches to Delivering IPTV
• Public Internet or private fiber networks
• TVs, Computers, PDAs, Cell Phones
• Linear or VOD or both• Fiber or Satellite• MPEG-2 or MPEG-4• STB choices• Many middleware choices• DRM/Encryption options
Service Provider Model
The
Network
Student Housing Platform
The Promise of IPTV• More programming
– Hundreds of channels from major content providers
• More applications unrelated to entertainment
– Healthcare– Education– Productivity enhancements
• Switched network– Theoretically infinite channel capacity –
both for linear and VOD offerings– A la carte in the near future– Get ready to Google your TV
• Better picture quality– Digital from the head-end to the STB
• Significantly lower costs for bundled IP services
• Content encryption – DRM to the satisfaction of the studios
The Reality• Today - equal programming
– Same as cable or satellite • Switched network
– Promise not yet realized– Not enough content available . . . yet
• Better picture quality– True for standard def– BUT, no HD available
• Significantly lower costs for bundled IP services
– BUT, RBOCs can (and will) subsidize pricing of traditional offerings
• Content encryption – Still not much content available for
IP-based transmission
Legal Overview
• Types of Service Contracts– Bulk Agreements
• Residents can opt to subscribe independently to other services and premium programming
• Student Housing and Hotels typically Bulk Triple Play– Installation and equipment covered by owner
• Hotels: exclusive voice/video/data for rooms and common areas
– Right of Entry (“ROE”) Agreements
• Typically includes exclusive marketing for life of contract
• IPTV Programming Agreements– Need for Large Cooperative to be Competitive (i.e. NCTC)
– VOD content agreement aggregation required as well
Business Overview - I
• What you need to operate an IP based TV service– Network (long haul, last mile, in building)– Head-end– STBs– Middleware– DRM– Content– Buildings/Service Agreements– Customer Care
And make it all work!!!!!!!!!!
Business Overview - II
• What you need to be relevant and cost effective– Scale– Concentration of subscribers– Bundled offerings– Appropriately priced service agreements– Efficient hardware/software purchases– Effective and efficient network architecture– The right price for content– The right price for labor
Lessons Learned
• It’s all about the bundle• Bandwidth, bandwidth, bandwidth• Computer illiteracy rates• Low demand for phone service• HD and multi-stream PVR quickly becoming must
haves
Beyond the Triple Play:The Edge of the Future
IP-based Controls
Product
The FutureInnovation: Key to Extending the “Reach” of IPTV
• A glimpse offered from the past
• IPTV will ultimately use the public Internet for VOD and private IP
networks for live and real time streaming of high quality video in an
open architecture
• PVRs more disruptive than you might imagine
• IPTV’s future is far beyond that of just entertainment…healthcare,
distance learning, logistics, security…
• The applications that will drive IPTV usage is anyone’s guess and
everyone’s opportunity
IPTV Cable
Internet AOL
IPTV Cable
Internet AOL
Thoughts/Questions
• Meaningful deployment of real bandwidth is still a ways off– Will broadband-over-powerline (BPL) ever be relevant
• Wireless multicasting very, very costly
• IP applications will drive value – can’t just be a 3rd wire
• Content is king – Hollywood quickly embracing IP delivery, but still far to go
• When will TV quality video be available via the Internet in a usable fashion?
• Keep your eye on WiFi/Cellular dual mode phones—The 3rd Screen
• VOD business models will transform the economics of entertainment
• Microsoft is coming – but when? And with what?
A Closing Thought
“Technology is only one of many forces driving human history, and seldom the most important. . . . Technology only gives us tools. Human desires and institutions decide how we use them.”
- Freeman Dyson, The Sun, The Genome and The Internet
The real opportunity before Ireland is to discover, not determine, how humans and institutions desire for IPTV to be used.
