Telecommunications operators have missed their "window of opportunity" to dominate the IPTV (Internet Protocol television) space, according to an Irdeto executive.
Telcos failed to exploit their chance two to three years ago to deploy IPTV most effectively, and have now been squeezed out of the content-delivery game by broadcasters, said Thierry Raymaekers, Asia-Pacific managing director of business development at Irdeto, a digital content management provider.
With plenty of competing content on cable channels and free-to-air satellite TV, telcos are finding it difficult to make IPTV a compelling offering for customers, Raymaekers explained in an interview Thursday with ZDNet Asia at imbX 2009.
Furthermore, with broadcasters now eyeing IPTV opportunities, this places more pressure on telcos because broadcasters are in a better position to combine IPTV's functions with the content they already offer, he noted.
Raymaekers said: "Telcos have not mastered [the practice of] thinking like a broadcaster. Telcos are still thinking about flow, bandwidth, and bits and bytes, and not thinking about how to appeal to customers."
Content delivery is a "different world" to telcos, which tend to see a movie as "1.5 hours of data", he said. Broadcasters, on the other hand, understand that a blockbuster carries higher value than a regular movie.
Raymaekers pointed to the success Swedish telco, TeliaSonera, had with its IPTV rollout. The operator entered the market at a time when Sweden had only two free-to-air broadcast channels. TeliaSonera's IPTV offering introduced some 30 channels to customers, immediately filling a void in the market, he said.
According to reports, TeliaSonera added 27,000 subscribers in the fourth quarter of 2008, bringing its subscriber count to 477,000.
Raymaekers noted, however, that good paid-TV content is already available in the Asian market, making it hard for telcos to find an entry point.
In Singapore, for example, SingTel's mio IPTV offering has little more to offer than StarHub's more mature cable TV service. The latter also has more exclusive content, making it an easier choice for consumers, he said.
Telcos typically have a tougher time negotiating for exclusive content rights, because content owners more likely prefer to sign with the broadcaster that has the biggest market share. This is typically the incumbent, not the telco, Raymaekers noted.
Unique services driving success
The good news is that the game is not over yet for telcos.
According to Raymaekers, telcos hold the advantage with their ability to offer bundled triple-play services. For example, a telco can offer discounted packages for subscribers that bundle mobile phone, home Internet and IPTV services.
To further build on their triple-play model, telcos can gain leverage over traditional broadcasters by securing exclusive rights with content owners to broadcast content across different media. This would allow telcos, for example, to offer IPTV subscribers the option of watching the same content for free on their mobiles, said Raymaekers.
The ability to offer customers what broadcasters are unable to provide, helped bring success for Chunghwa Telecom's IPTV business, said Taiwan's largest mobile phone operator.
In his presentation Friday at imbX, Huang Tzu-Han, Chunghwa Telecom's president of Northern business group, said the telco competes with cable players in both voice and data. Chunghwa's "Karaoke on demand" as an example, Huang said offering services that are unique has proven successful with its targeted audience.
Its broadcast of the Beijing Olympic Games last year also pushed its subscriber count. Huang said: "Quality content is a growth accelerator."
Chunghwa saw its IPTV subscriber base climb 71.5 percent to 676,000 in December 2008, from 394,000 in the same month last year.
Play video
There are currently no comments for this post.