TV delivered over internet protocol (IP) or mobile networks will have a growing role to play in telecommunications strategies, analyst firm Ovum said.
Revealing the findings of recent research, it said worldwide IPTV revenues are forecast to grow from $1.5 billion (£800 million) in 2006 to $9.3 billion (£5bn) in 2010. But these numbers aren’t that big, said senior Ovum analyst for broadband based consulting services Annnelise Berendt.
The TV medium (delivered over fixed line or closed IP networks) had definitely moved out of the trial phase with triple-play [fixed, broadband and TV on-demand] telcos well poised to capitalise, said Berendt. “We moving into a phase where companies are building services in their own right.”
She said it has been easier for players here to gain a foothold given its entry into a market where the customer base is already prepared to pay for premium content and subscriptions from satellite and cable incumbents.
“Profit is not the only motivation. Telcos have little choice to but to go into IPTV services in some form. Voice margins are being squeezed and it’s becoming very difficult to sell internet access based on speed alone, with competition coming from the leftfield with AOL and Sky broadband offerings,” she said.
Strategically differentiated approaches based on the content, advertising and provision mix would provide the winners and losers in this and the mobile space.
Eden Zoller, Ovum consumer practice principal analyst said mobile TV has the potential to go from a “zero to hero” service for providers but was still in early development phases.
A key decision here would be whether to invest in the better network infrastructure capabilities to deliver mobile TV with the same coverage as voice and data using DVB-H technology or to enhance existing 3G investments, she said.
“Consumers like the concept at least,” said Zoller. “But there’s plenty of potential to scupper providers in terms of how consumers will pay, given their wallets are not infinite, and what delivery models will prove popular. There are not just DRM [digital rights management] issues, but those related to spectrum, content formats like user-generated content and deals.” She added multimedia devices enabled for Wi-Fi access, including the likes of Apple’s iPod, had the potential to be disruptive to mobile operator plans.