27/04/06

1. Video franchising wins, Net neutrality loses

The federal video franchising bill received a thumbs-up yesterday when the House Energy and Commerce Committee approved the measure by a 42-13 vote. The proposal would allow telcos to offer IPTV services by bypassing local authorities, unlike the cablecos. This is one step closer to realizing faster deployment of IPTV services, however, the measure may go to the House floor for a vote. Some Judiciary Committee members would like to review it, too. The Senate hasn't acted on the issue yet, but it plans to this summer.

On the other hand, the Net neutrality bill was defeated 34-22 and is expected to be a source of conflict in the Senate. Rivals Google, Yahoo, eBay, Microsoft and Amazon.com have forged a united front to oppose the two-tiered Internet bill, which they say will give some Web sites an unfair advantage over others and alter the Web's landscape. It will be interesting to see how the video-franchising bill and the Net neutrality bill affect the uptake of IPTV and Internet TV in the upcoming years.

To learn more about the video franchising and net-neutrality issues:
- read this article from The Wall Street Journal (sub. req.)
- check out this San Francisco Chronicle article

2. NBC exec: IPTV is no big deal

IPTV is on everyone's radar at the National Broadcasters Association (NAB) conference in Las Vegas this week, but broadcasters don't seem to understand how much of a game changer IPTV could be. "Traditionally we had cable, then we had satellite come in as a competitive platform, and now we're seeing this third kind of platform [IPTV] for multi-channel and on-demand kind of content," said NBC's VP of technology standards, policy and strategy, Glenn Reitmeier. Reitmeier's statement seems to echo that many of the broadcasters at NAB who think IPTV is more relevant for on-demand content players.

But what the broadcast crowd needs to grasp is IPTV's effect on ad revenue. The streams of information between viewer and service provider are much bigger for IPTV, meaning the service provider can accumulate data on end users' habits--even the number of times they change the volume. Tracking the effectiveness of ads is a crucial offering that cable and satellite can't match at this point. That could change in the future, but for now the specter of IPTV looms large on the advertising front. This serves as a wake-up call for the IPTV industry to educate the content providers first before educating the subscribers about what is IPTV.

For more on NAB and broadcasters' take on IPTV:
- see this article from Light Reading

3. AT&T plans 21-market IPTV roll out

Building on its experience in San Antonio, AT&T has announced plans to offer IPTV in 21 markets by the end of 2006. AT&T's U-verse package, which will be delivered over the company's Lightspeed infrastructure, will offer a broad range of services including TV, broadband and VoIP. AT&T executives won't say which additional markets it plans to target in coming months, but it's likely the telecom giant will stick to smaller cities for a while. AT&T's San Antonio customers already get 200 channels of content, picture-in-picture browsing, digital video recording and video on demand. New services will include interactive games and programs, plus a feature offering alternative content based on a customer's viewing history. Offering new interactive content is a good move for AT&T--while lower prices may convince customers to try IPTV, interactive services should help the telco retain them for the longer term.

For more background on AT&T's plans:
- Read this TechWeb.com article

ALSO:  AT&T struggles to line up cable programmers, who worry that unencrypted IPTV content could be stolen in transit. Article

4. IPTV competition comes to TX, lowers prices

Prompted by a new Texas law allowing telcos and other broadband providers to seek video franchise licenses, carriers are beginning to roll out new IPTV services across the state. With AT&T already a player there (see story, above), and Verizon rolling out its FiOS service, the state is emerging as a national leader in IPTV implementations. But Texas should soon have company. With federal video franchise legislation pending--and states enacting similar laws--it seems that video franchising competition is here to stay.

As IPTV has hit Texas markets, cable companies have been forced to respond decisively. Since the roll outs, competing cable providers have dropped their prices significantly and upgraded their service offerings. For example, with Verizon offering FiOS TV for $43.95 per month, Charter Communications lowered its video price from $68.99 per month to $50 per month and threw in fast Internet service to boot. Experts say such competition is likely to lower cable prices in virtually any market where IPTV becomes available.

For more information on Texas IPTV roll outs:
- see this article in IT&T News

ALSO: Aides say President Bush is unlikely to sign video franchise law this year. Article

5. Metric: IPTV, new media to top $27B in US by 2011

According to a recent report conducted by Insight Research, IPTV, mobile TV and Internet streaming media will be worth $27 billion in the U.S. by 2011. The figure includes money derived from network-related equipment sales and content-generated revenue from the end user. The report focuses solely on "streaming media," which the research firm defines as digital audio and video files over an IP network or wireless network in real-time or on demand that cannot be stored locally. At first glance, lumping IPTV in with mobile TV and Internet TV seems like an odd idea. However, with the rise of IMS between now and 2011, this approach seems to make sense as IMS will provide a common IP architecture for VoIP, IPTV, Internet data services and wireless services. While the figure seems somewhat bullish since it considers the U.S. only, the firm qualifies the estimate as "conservative."

For more on Insight's latest report:
- see this press release

ALSO NOTED

TODAY'S SPOTLIGHT... President Bush re-nominates Martin
President Bush has renominated FCC Chairman Kevin Martin for an additional five-year term starting July 1, 2006. Release (White House)| Statement (FCC Chairman Kevin Martin, pdf)
 

> After selling off Swiss ComHem to Carlyle Group for €1 billion, EQT quickly returns to the cable-TV industry by buying German Kabel Baden-Wurttemberg from Blackstone Group for €1.3 billion. Article (The Wall Street Journal sub. req.)

> Chutes & Ladders: U.K. set-top box manufacturer Pace Micro Technology has appointed Mike McTighe as its new non-executive chairman. Release

> Cisco to provide Swiss broadband communication provider Bredbandsbolaget with FTTH gear for triple-play services. Release

> Envivio collaborates to integrate its mobile series of MPEG-4 encoders with Medialive's content protection technology. Release

> IPTV set-top box supplier Amino launched AmiNET130, a new gen of CPE that supports High Definition, H.264 (MPEG4/AVC) video streams. Release

And Finally... Motorola ships more than 2 million digital set-top boxes in the first quarter of 2006. Release

20/04/06

1. Cisco, Telus invest $16M in Widevine encryption

Cisco, Telus and a group of VC firms are investing $16 million in Seattle-based Widevine, which provides encryption software for content protection to cable, telephone and satellite operators. The 75-person company also competes with News Corp. subsidiary NDS, which provides an encryption technology known as VideoGuard for DirectTV, and Swiss company Nagravision. The investment allows Widevine to maintain its independence, particularly from rival Microsoft. CEO Brian Baker had previously rejected several offers from Microsoft over the past one year.

Cisco's involvement in this deal should be particularly helpful to Widevine. Through a 2004 agreement, Widevine already supplies its digital encryption technology to Motorola set-top boxes (STBs). Now, with the investment from Cisco, Widevine's content protection technology can be added to Scientific-Atlanta STBs too. An agreement with Siemens, a third STB maker, is expected to be announced soon.

To learn more about the investment:
- go to this Seattle Post-Intelligencer article

2. AT&T, Akimbo offer VOD over DSL

AT&T has announced a content deal with start-up Akimbo Systems, in which the content provider will offer 10,000 television on-demand programs and movies to AT&T's Homezone customers. San Mateo, CA-based Akimbo assembles on-demand content from 165 different programming owners, varying from the BBC to the History Channel. This agreement comes on the heels of another significant AT&T content deal, in which online movie service Movielink agreed to offer Homezone users more than 1,000 on-demand films.

Homezone is AT&T's interim video offering for DSL users, in place until the company is able to offer IPTV service over its "Lightspeed" fiber-optic network. AT&T has been selling EchoStar's satellite service since 2004, but Homezone, expected to be launched this summer in 13 states, will offer consumers a new set-top box that gets satellite TV programming from Dish Network. The new service will also connect to a DSL line to offer Internet-based services from providers like Akimbo.

For more on the AT&T-Akimbo:
- read this News.com article
- check out this Wall Street Journal article (sub. req.)

3. Lucent takes over Telefonica middleware

In what may be its most significant IPTV deal to date, Lucent is taking over development of Telefonica Group's Imagenio middleware. When development is complete, Imagenio's features will include interactive applications such as Web browsing, video conferencing and portable TV services. In addition to taking over Imagenio development, Lucent is establishing several IPTV R&D centers in Brazil, Chile, the Czech Republic and Spain, to serve as interoperability labs for testing and integration.

For more on the Lucent-Telefonica deal:
- check out this xChange magazine article

4. JDSU unveils video test systems

JDSU has introduced a digital and IP video monitoring system allowing operators to detect irregularities from the core to the network edge remotely. The system provides 24/7, simultaneous monitoring of more than 250 video streams and tests QoS at all access coverage points in a video network. The company has also provided new capabilities which eliminate manual testing and facilitate effective ad programming. SimulTrak, a gigabit Ethernet interface module, enables a single technician to simultaneously analyze and monitor hundreds of signals, eliminating the need to manually check each of the hundreds of MPEG-2 transport streams in a gigabit Ethernet link. Its Digital Program Insertion capability gives network operators added visibility into the digital ad insertion process.

For more information on JDSU's products:
- read the company's press releases

PLUS: Last week, JDSU expanded into home-networking by acquiring Test-Um, a provider of home networking test instruments for the FTTx and digital cable markets. Release

5. Harris makes $32M content delivery buy

Harris has acquired Optimal Solutions (OSi), a privately held provider of air-time sales, traffic and billing software systems to more than 350 broadcast stations in North America, for $32 million. Kansas City, MO-based OSi made $5 million in revenue last year and has approximately $27 million in revenue under contract. This acquisition will assist in Harris' goal of providing Total Content Delivery solutions.

For more on the acquisition:
- go to Harris' press release

PLUS: Timothy Thorsteinson is Harris' new president of the company's Broadcast Communications Division. Thorsteinson was president of Leitch Technology, acquired by Harris in October 2005 to expand into video infrastructure. He succeeds Jeremy Wensinger, who is being promoted to a senior leadership position within the Harris Government Communications Systems Division. Release

TODAY'S SPOTLIGHT... Microsoft TV chief steps down
Moshe Lichtman, who is responsible for Microsoft's TV division, has stepped down and will be replaced by Enrique Rodriguez, who comes from the company's Xbox division. Lichtman is returning to Israel for family reasons but will remain with the company. Prior to taking over Microsoft TV, Rodriguez worked with Xbox Partnerships, helping strike technology partnerships for the company's video game console. Article

> Yahoo acquired technology from Meedio to enter the digital video recorder (DVR) market. Meedio makes software that turns PCs into DVRs and digital media organizers, then links them with TV sets. Article

> Veoh Networks, an Internet TV broadcasting system, received $12.5 million in round two funding from Time Warner, Michael Eisner, Spark Capital and Shelter Capital. Release

> ITV and emuse launch a "One-Stop-Shop" platform for advertisers to run interactive campaigns simultaneously across satellite, digital terrestrial TV, mobile and online through one supplier. Release

> Digital Rapids will provide media content processing technology to Starwin Media, a U.S.-based satellite and IPTV service for the ethnic media market worldwide. Release

> Shenick addresses QoS through its diversifEye Version 3.0 software, used to test IPTV, triple play and broadband services performance as well as track quality issues within a single system. Release

> Modulus Video's high definition MPEG-4 AVC video encoder, ME6000, has been certified for the Microsoft TV IPTV Edition software platform and also supports Microsoft's TV Picture-in-Picture functionality. Release

> 16,000 science students scale IPTV to discuss global warming. Article

> Growth of online video content may inspire need for new gear. Article (Wall Street Journal sub. req.)

And Finally… "They really haven't started to do IPTV. Once the wireline companies start to offer TV over their connections, that's really going to soak up capacity," says TeleGeography Senior Research Analyst Alan Mauldin. Article

13/04/06

1. Verizon goes local to sell TV service

In Fairfax County, VA, Verizon is trying out something new: grassroots sales and marketing. Verizon executives have recognized the need to adopt a local approach to invade the cable companies' turf, in this case an area served by Cox and Comcast. To further this strategy, Verizon salesmen are walking door-to-door offering the service to residents. The company has also put its logo on pizza boxes and Chinese food takeout containers and given away discounted fuel at a gas station and free coffee to commuters. I even saw an ad for Verizon's FiOS service on a napkin at a bar here in D.C. Turns out Verizon will supply the bar with free napkins if they don't mind the pitch on them.

The battle in Fairfax County foreshadows what's in store for the rest of the country. Even if the video national franchising bill passes (see story below), the war is only half-won. Telcos will have to roll out aggressive local marketing campaigns to steal away cable subscribers.

For more on Verizon's local marketing:
- check out this article from The Wall Street Journal (sub. req.)

2. Google seeks software engineers for IPTV

Last Friday Google posted an ad seeking software engineers with experience in content management systems, user interface development for content-rich applications, cable and IPTV headend systems and digital video technology in embedded systems. Google currently broadcasts video on the Web and on select cable networks, but IPTV would give the company an interactive platform. Ovum VP of wireless telecoms Roger Entner suggests that Google could become a distribution channel similar to AT&T and Verizon.

For more on Google's foray into IPTV:
- read InformationWeek's article

3. House Subcommittee favors IPTV franchise bill

The video franchising debate moved forward last week when a House of Representatives subcommittee overhauled the Communications Opportunity, Promotion, and Enhancement Act of 2006. Unlike the cable companies, incumbent telcos have sought to bypass local franchise authorities to roll out their IPTV services. The new bill gives IPTV new-entrants (telcos) a 10-year, automatically renewable license on a national basis, without build-out requirements. The bill also includes provisions for cablecos to flexibly respond to the competition. It moves next to the full Committee on Energy and Commerce under chairman Rep. Joe Barton (R-TX). Barton has already given the bill a green light and expects it to pass through the House with GOP support from Speaker Dennis Hastert (R-IL). The controversial bill has received mixed reaction from industry groups--the National Cable Telecommunications Association is pleased, but CompTel is disappointed.

For more on the video franchising development:
- go to Telecom Web's article

PLUS: In an interview with BusinessWeek, FCC chief Kevin Martin talks about lifting barriers so telephone companies can bring video to consumers. Article

4. Gartner sees slow IPTV uptake in Western Europe

Gartner forecasts that IPTV in Western Europe will experience a strong subscriber growth, reaching 16.7 million in 2010 from 3.3 million this year. However, telcos will struggle to make IPTV a mainstream revenue opportunity over the next five years in the face of competition from pay TV services and free-to-air channels. Carriers in this region will resort to low-priced services and bundles to drive initial subscriber uptake. As a result their IPTV revenue will grow from €336 million in 2006 to only €3 billion by 2010.

Carrier strategies and subscriber levels will vary significantly between countries. An aggressive (low-entry price) push from competitive players such as Free, Neuf, France Telecom and the willingness of major pay TV services to support new distribution channels has made the French adopt IPTV in a big way. The U.K. will remain a weaker IPTV market due to the existing pay TV landscape and dominance of Sky TV. The price-sensitive German market is a challenge for pay TV due to the proliferation of fairly high quality free-to air-channels. It took 15 years to reach the current 10 percent penetration for pay TV, achieved only due to the football craze in the country. It looks like telcos need to add interesting interactive services to compete in this free-for-all.

For more on Gartner's IPTV predictions:
- check out this press release

PLUS: IDC expects IPTV subscriber volume in the Asia-Pac region, excluding Japan, to grow at a compound annual growth rate of 89 percent from 1.2 million in 2005 to a monumental 29.7 million in 2010. Release

ALSO: Cisco CEO John Chambers says analysts projections may be conservative when they estimate the market will grow to at least $4.5 billion a year by 2010, from a "couple hundred million" now. Article

5. Cable TV's reasons to be calm

Looking in the eye of the IPTV threat, proponents of cable TV say they have reasons to remain calm--at least for now. A Cable World article evaluating AT&T's strategy and the position of the cable industry in the IPTV market claims that AT&T's IPTV is not moving at "lightspeed." For one thing, it will be limited to a few markets and not differ much from a traditional cable system: Cable network enhancements will make the service function like an IPTV system. Though AT&T's marketing will jolt the cable markets, the telecom giant still needs to win large numbers of converts. AT&T also needs to iron out QoS and scalability issues in the next two years as it rolls out IPTV across the country. Cable can't dismiss AT&T outright, but it has plenty of time to assess the marketplace and formulate a defensive strategy.

To hear the cable industry's thoughts:
- check out this Cable World article

ALSO NOTED

TODAY'S SPOTLIGHT... Indian telcos urge regulator to usher in IPTV
Last week Indian telcos urged telecom regulator TRAI to bring in laws to regulate content in the IPTV market. Global technology providers such as Alcatel, Microsoft and Ericsson are already in talks with operators to offer IPTV. Reliance Communications Ventures says that the company has already built the required IPTV infrastructure and wants to initiate talks with companies for content. Article | Report

> The FCC says there are "legitimate concerns" over the viability of family-friendly programming tiers cable operators have proposed. Article (Wall Street Journal sub. req.)

> Abbeynet raises $8.5 million to develop an IP set-top-box and content delivery platform integrated to its Web and mobile VoIP platform. Release

> "There is no intention to regulate IPTV in the Netherlands," says director general for energy and telecommunications Guus Broesterhuizen. Article 

> TVHead launches games-on-demand TV network for American cable and IPTV operators. Article

> Spain's Jazztel selects Orca Interactive, a middleware and applications developer for IPTV, as part of a multimillion-euro deal. Release

06/04/06

1. Alcatel, Lucent approve merger

Just nine days after announcing their advanced talks, Alcatel and Lucent board members approved the merger. This will form a truly humongous communications provider with a market cap of $36 billion, something that Alcatel Chairman and CEO Serge Tchuruk always wanted his company to be. Alcatel shareholders will own 60 percent and Lucent shareholders 40 percent of the combined company, which will have revenue of $25 billion. After a regulatory process, the deal is expected to close in the next six to 12 months. The combined company anticipates $1.7 billion in cost synergies within three years. With the current political situation in France, it will be interesting to see how the French take to Lucent CEO Patricia Russo, an American, leading the new enterprise. The new company will be incorporated in France with a new name to be determined at a later date. How does Lucatel or Alcacent sound?

To learn more about the Alcatel/Lucent merger:
- read Alcatel's press release
- see these slides for media and analysts
- read the transcript of the conference call

2. Chutes & Ladders: Burke's exit blurs BT Vision

BT Entertainment CEO Andrew Burke, who was overseeing the company's move into television later this year, has quit "to pursue other interests." Burke, who was named when BT's content division was established in 2004, is leaving at the end of April and will not be replaced. The lead responsibility for BT Vision will remain with former Universal executive Dan Marks, who is CEO of TV services at BT Retail, with the support of Lib Charlesworth, the former general manager of Freeview, who was poached to become BT Vision marketing director.

For more on Burke's departure:
- read this C21Media.net article 

3. Strong PON, Ethernet FTTH equipment sales

According to a new Infonetics Research report, worldwide OLT and ONT PON equipment revenue hit $619 million in 2005 and will grow to $2 billion in 2009. PON port shipments are projected to grow even faster, hitting 10.7 million in 2009. "Video, IPTV, and other high bandwidth applications are driving demand for PON and Ethernet FTTH equipment all over the world," said Infonetics analyst Jeff Heynen. "PON is very strong in the Asia Pacific region, particularly EPON, which is huge in Japan and will roll out in China soon as well. In North America, Verizon's BPON-based fiber to the home network, FiOS, is in full swing: at the end of 2005, Verizon had already passed over 3 million homes through FiOS. In EMEA, Ethernet FTTH is strongest, especially in Scandinavia where municipalities and utilities are working together to deploy Ethernet FTTH networks."

For more on the report:
- see the press release

4. Alcatel identifies trend toward user-centric services

Alcatel APAC President Christian Reinaudo identified three trends that are shifting the industry toward offering user-centric services:

• Increasing demand for multimedia services, especially video: Both consumers and businesses want more than just basic voice and data services, namely video. Alcatel estimates the number of IPTV users to increase from the current 2.6 million to up to 100 million by 2010. In APAC, IPTV users are expected to grow from 900,000 to 16.5 million.
• Demand to receive the same services on different devices: The increased mobility of users is driving demand for converged services.
• Awareness of price: Competition in communications has made users more price conscious. This requires providers to offer new services to differentiate them from their competitors.

For more on Alcatel's views on IPTV:
- read this National Multimedia article

5. China's IPTV market ramping up

Indications are that IPTV will become a big development in China: ZTE recently won an IPTV contract from the Beijing arm of China Netcom for 50,000 subscribers and another IPTV license will possibly be granted to CCTV, China's central TV station. There is a prerequisite for China Netcom to promote IPTV by procuring an IPTV license--either by itself, or joining hands with a content provider possessing an IPTV license. However, it appears that China's State Administration of Radio, Film, and Television will not issue IPTV licenses to telecom carriers. Nevertheless, China Business reports rumors that CCTV has obtained an IPTV license and is carrying out internal integration, and that China Netcom may cooperate with CCTV in promoting IPTV. China Netcom will debut IPTV on May 17, the World Telecommunication Day.

For more on the Chinese IPTV developments:
- check out this China Business article

ALSO NOTED

TODAY'S SPOTLIGHT... TANDBERG TV CEO to lead Americas Integration
TANDBERG President and CEO Eric Cooney will lead the America's organization after having acquired N2 Broadband, GoldPocket and SkyStream Networks. This comes at the same time as TANDBERG President Reggie Bradford leaves. The company recently completed the U.S.-based SkyStream acquisition and anticipates to extend its position in the video compression market. Release

> Research firm GfK NOP says that IPTV in the U.K. could become a £1 billion industry if providers get it right. Article

> AT&T ties its California investment of $1 billion to IPTV franchising. Article

> India's Mahanagar Telephone Nigam will deploy Optibase's digital video head-end to provide triple play services in Delhi and Mumbai. Release

> DSP Systems' Director of Service Provider Strategy Michael Stich and TI's Business Development Manager, Streaming Media Group Charlie Gonsalves explain how IPTV roll outs put a premium on codec flexibility. Article

> ECI Telecom's broadband solution is being deployed in a commercial VDSL2 network in Europe for IPTV services, including multi-channel High Definition TV. Release

28/03/06

How will cable and satellite respond to IPTV?

"Cable and DTH players will seek to pre-empt the IPTV value proposition. They will emphasize and drive up the cost of content, move to IP, and ultimately, consolidate. DTH players in particular will also look at IPTV as an alternative distribution platform for their high-priced content."

This exclusive white paper excerpted from a top selling Pyramid Research report "Transforming Telcos with IPTV," examines the competitive reaction by Comcast and DirecTV through case study analysis.

Download the full 15-page whitepaper now.

23/03/06

1. Disney sees opportunity in telecom networks

The Washington Post reports that this week's TelecomNEXT show had an unusual guest--Walt Disney CEO Robert A. Iger, speaking volumes about the transformation of an industry. For Iger, these networks offer Disney a new way to deliver to consumers its vast array of content. However, like the advent of television in the 1940s, home video recorders in the 1970s and DVDs in the 1990s, the new technology reopens the question of how the people who create content and those who deliver it will split the pie of entertainment revenues.

Andrew Jay Schwartzman, president of public interest law firm Media Access Project, comments that Iger is rooting for the phone companies, but with some trepidation. Whether Disney makes money in the future is going to be profoundly affected by whether, when and how the telcos get into distribution. Yankee Group analyst Adi Kishore is of the opinion that a content owner can benefit from creating a fragmented distribution universe. This proliferation of delivery systems will give media companies more opportunity to play them off each other and to extract higher prices. Working with AT&T and Verizon could give Disney new, unconventional ways to deliver its shows.

But the phone and cable companies want to charge more to media companies, Web sites and other content providers to deliver the high quality of service to watch video. So, if Disney wants to rent movies to its customers from its own Web site rather than selling them to the cable or phone company, it may have to pay network owners more for the privilege. Some analysts believe that big entertainment companies like Disney have the money to pay for priority delivery, and can always refuse to sell content to the phone companies. Stifel Nicolaus telecom regulatory analyst Blair Levin comments that it's about optimizing revenues today so that another distribution pipeline gets built out to maximize revenues tomorrow. University of Colorado law professor Philip J. Weiser points to the iPod deal as a fascinating glimpse into the sorts of arrangements that may become prevalent, but whether content is king remains to be seen.

To learn more about Disney's look at telecom:
- read this Washington Post article

PLUS: News Corp. Chairman Rupert Murdoch argued last week that content was "king" in this digital age, but newspapers need to embrace the iPod generation or risk losing out in the digital world. Article

2. DT, Microsoft to launch IPTV in Germany

Following close on the heels of Telecom Italia commercially launching its IPTV service using Microsoft, Deutsche Telekom (DT) has also announced that it will use Microsoft TV IPTV Edition software platform to deliver IPTV services across Germany and France over its VDSL broadband networks. Microsoft will support Deutsche Telekom with joint marketing. The VDSL network, which is currently being extended by T-Com, will permit bandwidth of up to 50 Mbps and is planned for launch starting mid-2006 in 10 major German cities including Berlin, Hamburg, Cologne and Munich.

Customers will receive regular TV programs and advanced television services, including standard- and high-definition programs, interactive TV, DVR and VoD. AT&T (even excluding BellSouth) is Microsoft's largest IPTV customer worldwide, and now Deutsche Telekom is its largest customer in Europe. This brings Microsoft's IPTV trials and commercial customers to a total of 13.

For more on the DT launch:
- read DT's press release

PLUS: Microsoft reportedly is ready to launch Windows Live Video. Article

3. Verizon to pay CBS for shows run on IPTV

Verizon will pay CBS about 50 cents per subscriber for the right to carry its TV stations on Verizon's FiOS TV and is also in talks with AT&T. Securing payment for the right to carry CBS programs has been a priority for CBS CEO Leslie Moonves since his company split from Viacom in January and he hopes that this will put pressure on cable operators to pony up for its programming. As marketers shift more ad dollars from TV to the Internet, CBS sees subscriber fees as important to revenue growth. Moonves says that subscriber fees could pump hundreds of millions of dollars into the company. CBS' strategy is to capitalize on the increasing competition between cablecos and telcos to deliver TV to people's homes.

Verizon's FiOS TV reaches only about 1.3 million people in seven states and the company needs TV content to keep growing. The deal gives Verizon the right to carry CBS' 18 owned and operated stations to reach about 35 percent of the U.S. Forrester Research media analyst Josh Bernoff says that "Verizon is stuck. They need content, and they don't have much of a negotiating position." Analysts question how much leverage such deals will give CBS when agreements with cable companies start to expire next year. In any case, this may end up increasing the cost for the subscriber.

For more on this deal:
- check out this article from The Wall Street Journal (sub. req.)

PLUS: EU regulators approved a new Time Warner-CBS venture in which their respective WB and UPN networks will combine to form a new broadcast network called CW. Article

4. TV won't halt declining fixed telco services

Analysys finds that growth in TV and video services delivered over broadband will fail to halt the swift decline in the value of Western European fixed telecoms services in the coming years.

• Spend on core fixed telecoms services will fall to under 1 percent of GDP in Western Europe by 2011.
• Rate of decline in fixed service spend will vary by country, but spend will fall by more than 20 percent between now and 2011.
• Voice will fall to 50 percent of fixed-line spend by 2011, but Internet spend will also be in decline by that date.
• IPTV will create additional spend, but this will not be enough to stem decline in overall spend on wireline services.

For more on this report:
- check out Analysys' press release

PLUS: BT announced that its national next-gen TV service will be called BT Vision and will be launched in the Autumn. BT Vision will provide digital terrestrial TV with on-demand film, TV and music programming, as well as interactive services. Release

ALSO: Frost & Sullivan says BT will have to work hard to make its newly announced broadband TV service BT Vision a success. Although IPTV is likely to establish itself as a valid alternative to cable and satellite TV over time, despite the high expectations, IPTV may not be an immediate success throughout Europe. Article

5. Pioneer trialing Ruckus Wireless' 'smart Wi-Fi'

Pioneer Telephone Cooperative is trialing Ruckus Wireless' in-home "smart Wi-Fi" system to enable and distribute broadband digital services, such as IPTV, to any corner of the home using 802.11g WiFi. Pioneer launched its commercial IPTV service using ADSL2+ in June 2004 and has more than 20,000 broadband subscribers throughout 76 cities and towns. Pioneer is planning a phased roll out of the Ruckus WiFi system as part of its popular broadband services throughout this year. It is estimated that by using Ruckus System, Pioneer can reduce the time required for installing Cat5 cables from 3 hours to 45 minutes and cut in half the amount of labor and truck rolls needed. Ruckus is privately held and has raised about $14 million in two rounds of venture financing from Sequoia Capital, Sutter Hill Ventures and others.

For more information on this trial:
- read Ruckus Wireless press release

ALSO NOTED

TODAY'S SPOTLIGHT... Motorola in talks with Reliance for IPTV STBs
Motorola is talking with Indian Reliance Infocomm to sell it its IPTV set-top boxes (STBs). The requirement specified in the Reliance tender was that it should be compatible with Microsoft. The STB model has been developed in collaboration with Microsoft and AT&T, and the demand from Reliance Infocomm could be anything between 3 million and 5 million STBs. Others issuing RFPs for IPTV STBs are VSNL and BSNL. If the RFPs actually convert into large orders, Motorola may get Taiwanese Foxconn to manufacture the STBs boxes for it. Foxconn, meanwhile, proposes to set up a special economic zone jointly with Motorola and the Tamil Nadu Government near Chennai. Article

> Triple-play makes consumers think twice before subscribing to a bundled package. Blog

> Minerva and Nortel will jointly develop and release an open application interface (API) to enable the integration of real-time IPTV services using Minerva's iTVManager software and Nortel's IMS infrastructure. Release

> The government asks the BBC to win audiences with high quality, innovative programs. Article

> EchoStar is pursuing a new strategy that envisions investing more than $1.6 billion to dramatically increase its satellite fleet over the next few years, with plans to potentially lease some of the extra capacity to other companies. Article (Wall Street Journal sub. req.)

> mPhase launches an IPTV in a Box starter kit targeted at small operators to launch video services for up to 1,000 customers, or by large operators to set up a single or multiple central office IPTV pilot. Release

> Cambridge, MA-based Brightcove, an open Internet TV service, has acquired Seattle-based MetaStories, a provider of rich media publishing solutions. Release

> Sigma Designs adopts ANT's Galio Browser and IPTV Client software for integration with its media processors to ensure faster time-to-market and cost savings for IPTV operators using a consistent client approach. Release

> Yankee Group says there's not enough math in the TV business, but aQuantive, Atlas on Demand and others are figuring out how to give advertisers better feedback on who's watching. Article

> PacketFront claims that its BECS system lowers Monterrey, Mexico-based Interfibra's OPEX and CAPEX, and helps deliver triple-play services for low income residents for as low as $25 per month. Release

> Intel's Viiv technology helps system integrators tie multimedia components together to make a PC act like a DVR. Blog

And Finally... AT&T CEO Ed Whitacre defends the proposed merger with BellSouth and promises not to block anyone's access to the public Internet or degrade anyone's quality of service. Clip

16/03/06

1. House panel OKs national cable franchise to phone cos

In a setback for cable, House lawmakers last week agreed to award a national cable franchise--a bouquet--to phone companies and to subject cable operators to continued local franchising requirements--bricks and bats. The provisions, though not publicly debated at this point, are to withhold regulatory relief from cable until the phone company has secured 15 percent of the local video market, and to protect phone companies from predatory pricing tactics by cable incumbents. Under current law, cablecos are price-deregulated on the basic tier when pay TV competitors serve more than 15 percent of local households and are required to offer a uniform rate structure in a local market.

The agreement was reached by House Energy and Commerce Committee Chairman Joe Barton (R-TX), Telecommunications and the Internet Subcommittee Chairman Fred Upton (R-MI) and Reps. Chip Pickering (R-MS), John Dingell (D-MI) and Edward Markey (D-MA). Senate Commerce Committee Chairman Ted Stevens (R-AK) is expected to unveil a bill soon to include cable-franchising relief for the large phone companies. AT&T and Verizon have been urging Congress to adopt a national-franchise policy. The House agreement came three days after AT&T announced its $67 billion takeover of BellSouth, a deal that some predicted would hurt AT&T's and Verizon's chances of obtaining a favorable cable-franchising law from Congress.

For more on the panel's move:
- read this article from Multichannel News

2. Cable operators refuse Verizon TV commercial

Having received unanimous approval for system-wide franchise process in New Jersey, Verizon NJ is now publicly complaining that Comcast and Time Warner are unwilling to accept its paid 30-second TV commercial titled "CPI," while Cablevision did not respond to its emails seeking placement. The ad states that since 2001 cable prices have increased four times as much as the CPI (Consumer Price Index); while prices in some industries have actually gone down, cable rates have risen 86 percent since 1995.

Verizon claims that the cable operators are restricting the choice for consumers and slowing competition in New Jersey. Recently, the carrier also conducted a poll and found that 77 percent of New Jersey respondents support updating the franchising law and want choice. Verizon has pointed out that when it brings FiOS TV to market, cable operators slash rates at an average of 15 percent or more. Verizon is now considering running the spot on broadcast TV stations in New York and Philadelphia. The operator serves 526 communities and has announced FTTP networks in 123 communities in New Jersey, its home base. It seems that the carrier will aggressively take the TV home in its important market and leave no stone unturned to stake its claim to consumers.

For more on the ad dispute:
- read Verizon's press release
- check out Verizon's commercial
- read this press release from Verizon regarding poll in NJ

PLUS: Councils in Bellefonte, Delaware City and Odessa in New Castle County, DE, with 3,000 potential new customers, unanimously voted to grant Verizon FiOS TV franchises. Release

ALSO: Verizon unveils FiOS TV in Maryland to about 11,000 Howard County residents and expands availability in New York. Release (MD) | Release (NY)

3. Indiana passes statewide video franchise law

Indiana Gov. Mitch Daniels signed a franchising-reform bill that enables new competitors to get statewide operating authority within 30 days of application. With this law, franchising is now passed from city officials' hands to the Utility Regulatory Commission. The bill differs from those in other states in that it will allow incumbent operators to decide, after July 1, whether they want to opt out of local agreements and seek state licensing. All providers will have to pay 5 percent franchise fees. Incumbents, whether or not they are state-licensed, will have to continue institutional-network support until the end of their franchises or 2008, whichever term is longer. Indiana has joined Texas as the only other state in the U.S. to allow statewide video franchising. Virginia last week passed a law that expedites the video franchise application process but still leaves the ultimate decision to local municipalities.

For more on Indiana's new law:
- read this Multichannel News article
- check out this article from TV Week

4. Metric: 18% of U.S. may switch to IPTV

A survey of 15,000 U.S. early adopters conducted by In-Stat and funded by Siemens found that 18 percent of America's early adopter respondents, who now subscribe to cable or satellite TV, will "probably" or "definitely" consider IPTV as a viable option. With 10 percent savings offered on IPTV, an additional 34 percent of the remaining respondents would "probably" or "definitely" switch. According to the survey, the most popular services are:

• Time-shifted TV: 90 percent are interested and 58 percent are willing to pay extra.
• Video Telephony/Chat: 53 percent are interested and of those, 48 percent are willing to pay extra.
• Video Home Surveillance: 58 percent interested and 43 percent are willing to pay extra.
• Gaming: 37 percent are interested (not a surprise as only adults were surveyed) and 46 percent of those are willing to pay extra.

Respondents were ready to shell out an additional $7.50 or less each month for each service. However, they would like some services at no extra fees--caller ID on TV (69 percent), interactive information (63 percent), call logging (58 percent) and remote programming (57 percent).

In-Stat principal analyst Michelle Abraham points out that interest in IPTV will grow with understanding of the service. Portable entertainment applications may attract more attention as fixed and mobile networks become more integrated. Siemens says that IPTV subscribers need assurance that telcos and other broadband operators can deliver services like pay-per-view and VoD that they expect. Then they'll be more open for IPTV. Last week, Accenture found that 46 percent of U.S. and European consumers do not understand IPTV.

For more on the survey:
- read the press release
- check out the survey slides

5. Opportunities, strategies for European IPTV operators

Analysys says that European telcos must develop IPTV strategies tailored to local markets if they want IPTV to be a revenue earner rather than simply a product differentiator. In the disparate and complex European market of broadcasting and telecom that is different from the U.S., Analysys' Dr. Windsor Holden suggests that markets with high broadband and low pay-TV penetration offer the greatest scope for early IPTV adoption. In saturated pay-TV markets, operators should focus on exploiting IPTV's unique selling points. Holden also recommends that in an environment in which both basic and premium multi-channel TV platforms are well established, partnership with an existing TV platform operator makes more sense.

For more on Europe's IPTV potential:
- read Analysys' press release

PLUS: Telecommunications Magazine Online's survey of IPTV service provider expectations found that 50 percent of respondents in North America and 45 percent internationally were concerned about how to make a realistic and profitable business case for deployment. With IMS as the supporting architecture, 28 percent of North American telcos gave IPTV a top priority while, outside North America, 20 percent ranked IPTV deployments a top priority. While operators indicated service availability as the top key to success in providing IP video, providers based outside the U.S. ranked understanding customers video consumption habits/interests higher (48 percent) than North American operators (24 percent) did. Article (reg. req.)

ALSO NOTED

TODAY'S SPOTLIGHT... Alcatel announces two IPTV customers: Telenor, DT
Alcatel will supply it's ISAM (Intelligent Services Access Manager) products to support Nordic Telenor's "All IP" network strategy to high bandwidth triple play services such as IPTV, VoD and HDTV. Meanwhile, DT's T-Com will deploy Alcatel's 7750 SR to provide triple-play services, such as IPTV and interactive consumer services, in 10 large cities in Germany, including Berlin, Frankfurt, Munich, Hamburg and Stuttgart. This deployment is in line with DT's announcement to invest up to €500 million. Release (Telenor) | Release (DT)

> VeriSign will acquire privately held, Mountain View, CA-based Kontiki for about $62 million to complement its Mobile Content Services and expand its Content Services portfolio. Release | Article 

> AT&T, BellSouth, Verizon and CEA pledge interoperability of their various set-top boxes (STBs) or other IPTV interface devices. Article 

> Ovum finds that the intersection of content providers/studios and telcos is an opportunity to a new market where VoD becomes TV. Article 

> After trialling, Telecom Italia has commercially launched Microsoft's IPTV Edition software for its "Alice Home TV." The operator has also selected Verimatrix's Content Authority System (VCAS) for its AliceBox triple play service. Release (Microsoft) | Release (Verimatrix)

> PacketFront and Siemens provide open access triple play solutions to upgrade SEAS-NVE's, Denmark's utility company's broadband network. Release

> Madrid-based SIDSA (Semiconductores Investigación y Diseño) is launching Ether TV, an IP gateway for digital TV, to enter the IPTV market. Release (.pdf)

> Japanese Tranzas has licensed SecureMedia's Encryptonite System CA/DRM software to provide end-to-end IPTV content security. Release 

> Georgia-based Ringgold Telephone has selected Latens FCAS Conditional Access to encrypt Pay-TV and VoD content. Release (.pdf)

> AOL and Warner Brothers launch In2TV on AOL.com. Release 

> Tut Systems is upgrading IPTV headends from MPEG-2 AVC to MPEG-4 AVC for Allendale Communications, Consolidated Communications, MBO, and Iowa Network Services. Release

> Italian FASTWEB has deployed SkyStream Networks' Mediaplex-20 headend system. Release

And Finally...  New restrictions would ensure there were at least five commercial media groups in major cities and four in regional centers in Australia. Article

09/03/06

1. AT&T to acquire BellSouth, execs discuss IPTV

Soon after closing the SBC-AT&T merger, AT&T is now acquiring BellSouth for $67 billion. Their joint ownership of Cingular (60 percent AT&T, 40 percent BellSouth) has been cited as an enabler for a long time now. However, in the face of the increasing threat posed by cablecos and Internet companies, the trio concluded that by converging on a single IP platform (IMS) and providing IPTV services, they could experience some savings. AT&T and BellSouth executives gave some insight on how BellSouth's IPTV plans would be integrated in Project LightSpeed in response to analyst questions.

• AT&T COO Randall Stephenson: "What BellSouth is doing today is very complementary to what we're trying to accomplish with our LightSpeed initiative... They are on a path within the next couple of years to have 12 to 24 megabits through a substantial portion of their footprint [giving AT&T flexibility] as we ramp LightSpeed... we just continue with the BellSouth initiatives to get the bandwidth pushed down into the customer base and keep going on our territory with the LightSpeed... BellSouth has a relationship with DIRECTV [and AT&T has one with EchoStar]... Once we close the transaction we will have to evaluate how we synchronize those."
• AT&T CFO and SVP Rick Lindner: "In terms of LightSpeed we don't have any incremental CapEx built into the merger plans right now... The plan that BellSouth is on to get the bandwidth into their network represents 90 percent of what it takes to get project LightSpeed type infrastructure deployed."
• BellSouth Chairman and CEO Duane Ackerman: "...BellSouth is doing some trials in the IPTV area, and the more experience we have the more learnings we have in bringing it to market, the more effective and successful we will be with our video offering. So it is just a positive what they are doing."

Though BellSouth's 12 Mbps to 14 Mbps is not enough to support the IPTV requirements of 20 Mbps to 25 Mbps, it should help AT&T kickstart the service before they start delivering bandwidth intensive applications.

For more on this:
- read AT&T's press release
- check out AT&T's conference call transcript (pdf, Wall Street Journal sub. req.)

2. Verizon hits hurdles over fiber network

In spite of investing a large part of its resources and attention, Verizon's fiber roll out is facing some hurdles--the operator landed only 44 approvals (only about half the target) last year to offer TV service, is facing challenges digging up lawns and has already spent millions of dollars on lawyers to woo local officials. The recent AT&T-BellSouth acquisition is bound to add new pressure.

AT&T is rolling out triple play services using the cheaper FTTN method, spending roughly $5 billion through 2008 to reach 18 million homes with its fiber project, while Verizon's program eventually could cost as much as $20 billion. The operator has scaled back its FTTH plans and will use coaxial cable for the last few feet into customers' homes. This saves more than an hour on the usual six-hour installation and money. Verizon vice chairman Larry Babbio expects the cost of connecting individual homes with fiber to fall to $890 a home from the $1,400 a home it spent in January 2005.

So far, Verizon has brought fiber to more than 3 million homes and expects to add another 3 million by the end of this year. It has permission from local authorities to offer television service to 1.3 million people. However, only a fraction of those homes subscribe to the service. The operator did not give raises to many top executives last year, has frozen pensions for managers and is offering lower bonuses. The company says the cuts aren't connected to its fiber plans. I wonder if the recent AT&T-BellSouth merger triggers Verizon to do some additional mergers (after MCI) to increase its footprint and be in the competition.

For more on this:
- read The Wall Street Journal's article

PLUS: Following video franchising grants, Verizon makes FiOS TV available to 80,000 customers in Murrieta, CA, and 33,000 customers in Hillsborough, FL. Release (CA) | Release (FL)

ALSO: Verizon plans to aggressively market its FiOS service to MDUs this year. Release

3. Survey: 46% do not understand 'IPTV'

Accenture's survey of 6,030 consumers across six countries (the U.S., the U.K., France, Germany, Spain and Italy), excluding the more developed Asian region, found that 46 percent do not understand the term IPTV. However, the survey reveals some healthy demand for IPTV services.

• What consumers want: Choice (30 percent want more movies), control and personalization (26 percent want to create their own channels to watch at leisure).
• Factors encouraging subscription: Less advertising (55 percent), ability to choose specialist programs (47 percent) and value for money regarding content (41 percent).
• Barriers to adoption: Cost (54 percent are not willing to pay an extra fee to search content), security (38 percent) and quality of service (39 percent).
• Trends: Younger adults are more willing to adopt and pay for IPTV services than older ones. Men are more interested in IPTV than women.

The study provides some implications for IPTV service providers. Content will be the killer app and careful marketing and user education is required to attract customers on a wide scale. It would be more interesting to know specifically what cable TV, satellite TV and standard TV subscribers want.

For more info on this:
- read Accenture's pres release
- click here to download the Accenture IPTV report

PLUS: Eight things you need to know about IPTV. Blog

4. Thoughts from IPTV World Forum

IPTV senior level executives shared some thoughts on the telco-content provider relationship at the IPTV World Forum. According to T-Online SVP of Content & Portal Division Peter Kerckhoff, telcos are best positioned to tackle the studios major issues--security and footprint. He urged studios to collaborate with key local players rather than go it alone and initiating huge local market deployments. Tiscali UK Portal Director Richard Ayers voiced a similar opinion, saying that content providers should see ISPs as partners rather than parasites.

Meanwhile, Disney spokesman Darren Cochrane wants to wait to see how operators develop and then come in if the economics work, suggesting that  library titles can be used as part of the initial discussions. Sony SVP of European distribution Stuart Baxter did not find a percentage of low ARPU incentive enough to align for a long-term relationship. Andy Birchall of ondemand! pointed out that while Sony has margins of around 10 percent, adult content can easily command an 80 percent margin. Entone's spokesperson argued ARPU from U.S. homes is less than $10 a month and personalized TV based on additional ARPU cannot be justified.

Ovum Consulting Director Tom McKeever has a word of caution for the telcos: "video revenues are not going to save your share price, the web is a serious threat." He contends that making content themselves would be a mistake. Instead, they should partner with content providers to offer some differentiation.

For more on the forum:
- check out this Telecommunications Magazine Online article
- read this article from Telecommunications Magazine Online

5. Chutes & Ladders: ICTV nabs ex-MicrosoftTV director as CTO

Don Gordon joins Silicon Valley-based ICTV as its CTO and Senior VP of Engineering. ICTV creates HeadendWare, a delivery and distribution platform of interactive TV programming. Most recently Gordon was director of software architectures for Microsoft TV and played a part in the selection of Microsoft TV as the software platform for Verizon's FIOS TV service. Gordon has 26 patents to his name dealing with MPEG video and network-based interactive services.

For more on this:
- read ICTV's press release

PLUS: Envivio appointed Alain Fernando-Santana as its chief marketing officer as it expands its solutions for IPTV, mobile, enterprise and broadcast service providers. Prior to joining Envivio, Fernando-Santana was the CEO of Netcentrex  in the Americas region. Release

ALSO: Ali Taslimi joined Coaxsys as VP of corporate development IPTV and multimedia networking. Taslimi has been with AT&T Bell Labs, Lucent, Alcatel and Occam Networks. Release

ALSO NOTED

TODAY'S SPOTLIGHT... Amino to integrate Firefox into IPTV STBs
Amino will integrate the Firefox browser into IPTV set-top boxes so that customers can customize their options and navigate with a different television browser interface. The open-source Firefox browser will remove UI license fees from IPTV deployments. Release

> In addition to VoD and billing capabilities, Digital TX Managing Director Alexander Cameron suggests IPTV strategies for 25 U.K. companies including Vodafone and Channel 4. Article

> TI's AR7 ADSL2+ technology will be integrated with Corinex's ADSL2+ AV200 Powerline residential gateway to distribute up to nine simultaneous streams of video, including High Definition. Release

> Reliance Communication Ventures and Microsoft will roll out commercial IPTV in India by year's end. Article

> A new ad points out cable TV's 86 percent price hike over the past 10 years and urges Americans to call on Congress to declare an era of "TV Freedom" by bringing competition and choice. Release | "Through the Roof" Ad

> Midwest TelNet selects Latens FCAS Conditional Access solution to secure its IPTV services. FCAS will integrate with Amino's set-top boxes (STBs) and with Minerva's iTV Manager. Release (.pdf)

> Affordable Telecommunications Technology (Buzz Technologies) acquired a Geneva-based STB manufacturer. Release

> eWAN1 Global IPTV service will be launched in 36 languages including Urdu to help U.S. efforts in providing alternate programming in both Iraq and Afghanistan. Release 

> WEGENER integrates Verimatrix's user-specific forensic watermarking technology, VideoMark, into its IPTV STBs to track piracy. Release

> UIEvolution partners with OnDemand TV to deliver high-definition VOD-IPTV service with surround sound to 60 million customers at Japanese NTT-East and NTT-West this spring. Release

> Lucent is upgrading Cavalier Telephone's DMX platforms to converged LNW70 Ethernet cards to enable its new IPTV service offering in Virginia. Release

> Irish Magnet Networks deploys Zignal IPTV service delivery platform. Release

> KPN cleared to acquire Nozema. Article

And Finally... Verizon laptop theft may leave workers vulnerable to ID fraud Article (Wall Street Journal sub. req.)

02/03/06

1. IPTV M&As to create closed networks: Cisco, Motorola buy in

Making note of the continuing series of acquisitions in the IP video market, ABI Research warns the industry that the business model of end-to-end IPTV offerings may create closed networks. This model is based on the operators' assumed preference for single-vendor approach. Meanwhile, the adoption of standards such as Advanced TCA, OpenCable and MOCA indicates that all players are aware of the benefits of standardization, putting the onus on standards bodies to ensure convergence of vendor technologies into standard platforms.

ABI also points out that the resulting smaller number of vendors will not only deploy their video solutions in the telco networks but also deliver home networks and CPEs for the tech-unsavvy customers. The firm anticipates Hewlett-Packard, IBM, Nortel and Lucent will acquire or partner with IPTV specialists and finds Orca Interactive, Kasenna, Bitband, Optibase, 2Wire and Entone as attractive targets for acquisition.

For more on this:
- read ABI Research's press release

PLUS: Cisco completed its $6.9 billion acquisition of Scientific-Atlanta, a provider of set-top boxes, end-to-end video distribution networks and video systems integration. Cisco will now be offering an IP NGN architecture with a variety of integrated media services capabilities in addition to the current digital video/IPTV functionality.The Scientific-Atlanta team, led by CEO Jim McDonald, has become part of the Routing and Service Provider Technology Group under Cisco Senior VP Mike Volpi. Release | Article

ALSO: Motorola has completed its acquisition of the Swedish IPTV set-top box developer Kreatel Communications. Motorola claims that Kreatel's Linux-based solution that can be used with middleware solutions and will complement its end-to-end digital video solutions. Kreatel's team will be integrated into the Motorola Connected Home Solutions business and will continue to operate from Linköping, Sweden. Release

2. Middleware, security vendors' views on IPTV

Israel-based Infogate, a developer of middleware solutions for IPTV content, and Irdeto, a developer of security software for protection of video content against piracy and theft, teamed up to provide IPTV services and plan to offer their joint solution to an integrator such as Nortel or Unisys. Irdeto VP of Sales Parvaiz Ahsan and Infogate Product Manager Asaf Inbar give their views of the IPTV market:

• Advantages of IPTV over cable and satellite: bi-directional network with interactivity, flexibility, speed and customized content
• Lessons learned from the music industry: Encoding rendering pirated copies to be of inferior quality
• Advertising in IPTV: maybe based on two models--one with premium content with no commercials for a fee and the other with content including commercials for free
• Cellular TV: As with TV broadcasts, IP is one of the methods for transmission of cellular content. These are rival methods, and each has its own advantages and disadvantages, from both the technological and business perspective. The market is hot and developing rapidly with interesting times ahead.

For more on this:
- read this Globes Online article

3. Verizon FiOS TV available in Mass.

Soon after taking orders in Woburn, MA, two weeks ago, Verizon introduced FiOS TV in Reading, MA, a community of 23,000. Verizon obtained a local video franchise in Reading in January and is currently in negotiations with more than 30 other communities in Massachusetts to obtain additional franchises. The Verizon FTTP network is currently under construction in more than 40 Massachusetts communities. Verizon launched the service in Keller, TX, last September and has begun offering the service in parts of California, Florida, Virginia and on Long Island, NY.

For more on this:
- read Verizon's press release

PLUS: Verizon CFO Doreen Toben claims the company "continues to see a strong and growing customer response" to fiber-optic-based FiOS data and video product offerings with "well on plan" customer take-rates for FiOS services. The deployment costs are declining. Release

ALSO: Using Verizon's VOD, which is IPTV, subscribers can avail more than 80 hours a month of free on-demand titles from Disney Channel, Toon Disney, Radio Disney, Jetix, ABC News, ABC Family, SOAPnet, ESPN, ESPN Deportes and ESPNU. Verizon is also offering on demand new-release movies from Buena Vista Pay Television for $3.95 each. Release

FINALLY: The Virginia General Assembly has agreed on a compromise video regulation measure that speeds the entry of telephone companies into video service but requires greater investment on their part. Article

4. Germany's competitive IPTV landscape

Duetsche Telekom (DT) subsidiary T-Online Vision bought non-exclusive xDSL forwarding rights for five stations' programs in ProSiebenSat.1 Media after Telefonica purchased IPTV rights from ARD, ZDF, RTL Group and ProSiebenSat.1 Media at the beginning of February. In addition, ProSiebenSat.1 will also provide T-Online Vision with 200 hours of programs for its VoD service.

For more on this:
- read this article from Heise Zeitschriften Verlag

ALSO: DT intends to restrict its anticipated three years' IPTV transmissions rights of Germany's soccer league matches to its new VDSL network so that its VDSL network can be exempted from regulatory obligations that require access to it by competitors. Article

5. Kingston pulls plug on IPTV

Hull, U.K.-based Kingston Communications will pull the plug on Kingston Interactive TV (KIT) on April 3 because not enough people watch it. Without the benefits of scale and increased competition, the telco does not find further investment in KIT to be cost-effective. Existing customers have been notified of the closing. HomeChoice is now the only operator providing a digital and on-demand TV service over a broadband connection in the U.K.

The service was launched in October 1999, and at one point KIT boasted 10,000 subscribers. The carrier is said to be negotiating with satellite TV provider Sky to take over its dwindling installed based of some 4,000 subscribers. Kingston has spent $17 million to $20 million on KIT over the years, earning no profit. Meanwhile, BT is gearing up aggressively for its nationwide IPTV launch later this year. Cartoon Network has become the latest content provider to sign on to the service.

For more on this:
- read this article from The Register
- check out TelecomWeb's article

PLUS: To face the increased competition, the U.K.'s largest satellite broadcaster, British Sky Broadcasting Group (BSkyB), signed a deal with Walt Disney to offer additional Disney content with premium Cinemagic. The content deals indicate "content is the king." Article

ALSO NOTED

TODAY'S SPOTLIGHT... Reach consumers with addressable IPTV ads
Packet Vision Managing Director Patrick Christian points out that addressability and bi-directional characteristics of IPTV makes its a perfect mechanism for tailor-made ads. Relevance is the most critical issue in creating brand recognition and driving consumer response. Addressable advertising will emerge as a revenue generator for IPTV service providers, who have been left out of the advertising value chain. Advertisers, too, can benefit by precisely targeting audiences and receiving accurate feedback. Article

> Among other growth strategies, Nortel CEO Mike Zafirovski wants to invest in IPTV, IMS and WiMAX. Webcast | Article

> Siemens Home and Office Communication Devices (Siemens SHC) is now licensing Galio Client from ANT, a provider of middleware software, to deliver TV services across a range of Siemens SHC devices worldwide. But Siemens already owns a middleware vendor, Myrio. Release

> Swedish utility company Varberg Energi selected European Latens, a supplier of software based conditional access IPTV and Pay-TV, to provide Foundation CAS content and revenue protection for its IPTV services. Release (.pdf)

> Infonetics reports that competitive pressures, rising broadband traffic and IPTV opportunities attributed to the growth of long haul WDM equipment, which was up 32 percent in 2005 from 2004. Release

> IPTV set-top box (STB) supplier Amino partnered with Trimedia Broadcast to provide an end-to-end system for corporate IPTV to install an internal communications system sans incompatibilities. Using the AmiNET family of IPTV STBs, Trimedia has already secured a number of deployments, including a bespoke in-house IPTV service for Discovery Networks Europe. Release

> Kasenna draws on reseller and integrator Thunderworx's existing relationship with Cypriot teleco Primetel to deploy its IPTV solution. Primetel will provide an IPTV-based VOD service for home subscribers in 2006. Release

> TANDBERG Television works with Siemens to provide MPEG-4 AVC video compression for Shanghai Telecom's IPTV. Tandberg also revealed that it provided  MPEG-2 video compression to NBC to cover the 2006 Winter Olympics from Torino, Italy. Release

> Brasil Telecom will launch Internet TV services in the third quarter of 2006 providing VOD and electronic gaming. The telco has received proposals from six providers wishing to partner with it in delivering IPTV. Abstract

> EGT has completed a third round of funding of $8.5 million from Noro-Moseley Partners, H.I.G. Capital, Sevin Rosen Funds and others to speed new product delivery for IPTV. Release

> With Multidimensional Ethernet and a new BlackDiamond 12K switch, Extreme Networks helps carriers deliver IPTV and VoIP, with improvements in QoS and subscriber scaling. The switch has been deployed at TelstraClear. Release

> Telstra completed Winter Olympic program delivery for Seven Network over a Scientific-Atlanta system, connecting Torino, Italy, with Melbourne. Release

> Austria-based Telesystem Tirol has deployed BigBand's BMR (Broadband Multimedia-service Router) for headend-based processing and control of its digital TV offerings for handling the processing, management and delivery of digital video. With this installation, BigBand Networks' customers in Europe have increased. Release

> Soon-to-launch Aussie IPTV service provider Reeltime expects to raise $4 million through the issue of 20 million, 20 cent shares. Article

> The Chinese government's three IPTV principles intend to neither have Chinese IPTV standards submit to a foreign one, nor to have it monopolized by a single party within the domestic market. Article

> Soon after rolling its solution at Belgacom, SupportSoft is now supporting BellSouth. Release

> Digital TX Managing Director Alexander Cameron enlists good looking and feeling STBs designed for ladies as important for consumer electronics and technical entertainment services. Check out his complete list. Article

And Finally... According to General Manager Dean Harris, "WealthTV's broad appeal and ability to allow viewers to live the American dream now by simply watching their TV, will deliver what Guadalupe subscribers are seeking and dreaming of." Release

01/03/06

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Learn more about IMS key elements, services and the benefits of Intel Modular Communications Platforms.

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