Despite a slow start, internet protocol television (IPTV) and mobile TV services have been gradually gaining momentum in the global markets as they provide newer avenues of growth for telecom operators. These services are becoming increasingly popular, with more operators foraying into this space in an attempt to differentiate their offerings and drive up their average revenues. Moreover, these technologies offer service providers enormous benefits, which include expanding their broadband deployments across the country and providing consumers with new platforms for multimedia content.
IPTV
IPTV’s growing popularity is on account of the advantages it offers over alternative television services such as the conventional cable. IPTV helps reduce the operator’s fixed line subscriber churn rates and increases the customer base by bundling value-added services such as video-ondemand (VoD) and movie-on-demand.Moreover, with their networks already in place, operators can offer IPTV services without incurring any significant additional capital expenditure. They can also generate significant revenues from advertising.
IPTV also has a lot to offer from the customer’s point of view. It has the potential to facilitate three-screen convergence and offers a greater degree of interactivity. A switched IP network also enables the delivery of greater content and functionality.
However, the mass-market adoption of IPTV has not been as fast as that of other innovations such as mobile phones and iPods. This is because its value proposition to consumers may not appear as compelling as that of other products, making it unlikely for users to substitute their current cable or satellite TV set-top boxes to subscribe to IPTV.
tele.net takes a look at some of the major issues that have been hindering the largescale adoption of these services…
Implementation issues
IPTV’s implementation involves a number of challenges. There are concerns with regard to last mile connectivity infrastructure as the wires (underground and overhead) often get twisted and cause disturbances in the traffic flow. Also, only about 25 per cent of the digital subscriber line access multiplier capacity can be used to deliver the service due to the lack of backplane. Moreover, the broadband network needs to be configured for multicast and VoD services when there is a service expansion, and this can result in a number of complications.
Bandwidth requirement
Low broadband penetration and lack of bandwidth have also been impeding IPTV uptake. IPTV requires 33 per cent more bandwidth than cable networks to become a viable option and offer high quality services. The issue is not just limited to the quantity of bandwidth required for a single stream (multicast or otherwise) but also the scalability of the bandwidth, given the prospects of high definition channels, multiple television sets per household and a rapidly growing subscriber base on the local loop.
Quality of content
As with other distribution platforms, IPTV services need compelling content to attract and retain customers. The content’s timing, pricing, availability and relevance, along with its quality and personal interest value, are what make it compelling and sellable. For most operators, securing the right content offer is the biggest challenge in entering the IPTV marketplace.
Until recently, IPTV services had been offering very limited valuable content. Though some progress has been made with regard to this, there is still a long way to go, given the mounting pressure on content margins on account of the increased competition and distribution. Therefore, IPTV providers need to offer personalised content based on the consumer’s tastes and preferences in different markets in order to gain profits in the longer run. Cable TV operators can also reuse their content for IPTV services by forming alliances with IPTV service providers.
Consumer awareness
Lack of consumer awareness about the benefits of IPTV over normal cable or direct-to-home services has been a key impediment to its growth. People are not fully aware of the innovative services, such as time shifted TV, offered by IPTV.Therefore, a proper marketing mechanism needs to be put in place.
Mobile TV
Though mobile TV has had a slow start, it offers a huge potential for the future. It has achieved considerable success in countries such as Korea, Japan and Italy. A large fraction of mobile subscribers in the Asian region, known for its high levels of mobile subscriber penetration, has also been availing of mobile TV services.
One of the key reasons attributed to its success is that it offers a greater degree of personalised and enriched communication between end-users and service providers, representing a change with regard to marketing effectiveness. This enables stakeholders to communicate with their audience on a more individual level, thereby bringing in added value for operators, broadcasters and end-users in the form of new content formats, targeted advertising, personalised content programming and presentation, as well as improved customer relations.
So far, operators offering mobile TV have taken diverse approaches to services, pricing, marketing and technology.
However, it is imperative for them to get the approach right as mistakes can prove costly and prevent the realisation of mobile TV’s true potential. Some of the key areas that operators need to look into are:
Costs
Since the profit potential from broadcast mobile TV services for mobile operators is low, key stakeholders need to work towards reducing the costs of offering broadcast mobile TV services. To substantially reduce the three key cost drivers ?? network rollouts, incremental handset subsidies and content costs ?? existing mobile networks can be combined with broadcast mobile TV networks, and the content costs can be partially financed through advertising.
Regulatory framework
One of the major challenges facing the mobile TV market is its complex, and often uncertain, regulatory and licensing environment. In some countries, restrictive regulatory policies hinder the rapid and universal adoption of mobile TV services. The key regulatory issues include the uncertainties that exist in some countries over the sharing of responsibilities by the regulatory agencies. There are also challenges pertaining to the issuing of licences to mobile broadcast network operators and the definition of their role in the industry.
Therefore, it is essential to adopt a favourable regulatory regime that will help the mobile TV segment to prosper and bring in greater certainty in individual markets as well as better coordination across international markets. Without proper regulations in place, vendors, operators and broadcasters will not be willing to commit the necessary investments to make mobile TV a success.
Spectrum
The availability of radio spectrum is vital to the commercial success of mobile TV.Lack of suitable and sufficient spectrum is likely to inhibit economic activity and impede the growth of new content, advertising models and revenues for investment.Governments and regulators need to ensure the timely availability of spectrum.
Though there has been no global allocation or identification of spectrum specifically for mobile TV, steps are being taken at the regional and national levels to develop a frequency plan for future digital services. It is estimated that the terrestrial TV switchover from analog to digital transmission will enable the delivery of existing terrestrial TV services with typically between a third and a half of the existing spectrum requirement. Thus, significant amounts of spectrum will be released for reassignment for new uses, some of which is expected to be made available for mobile broadcast services.
Content
Given the plethora of entertainment options, the modern consumer has a short attention span. It is, therefore, vital that mobile TV content be compelling. Also, most of the content that is developed for the large screen is not suitable for the small mobile screen. There is, therefore, a need to develop content specifically for mobile TV such as mobisodes, which are relatively short mobile episodes of popular TV shows. Launched in 2005 by Vodafone in collaboration with 20th Century Fox, mobisodes have gradually increased in popularity and currently account for a major part of the mobile TV viewership globally.
Quality of service
The industry also needs to work towards enhancing the service and price attractiveness of broadcast mobile TV to end-users.The price, usability and attractiveness of broadcast mobile TV services need constant development. For instance, by providing improved outdoor and indoor network coverage and improving the TV channel bouquet, service providers can offer a better user experience.
All in all, while this technology clearly holds promise, its success is dependent on a few key parameters including coverage, choice of multimedia channels, quality of content, ease of navigation, attractive pricing and wide commercial availability.
