Abstract
Decline in Traditional Revenues Force Telecom Operators towards IPTV
With the deregulation of the telecommunications market, incumbent telecom
operators are witnessing a gradual decline in revenues from traditional
business streams. In addition to the entry of alternate service providers,
soaring wireless adoption and new technologies such as voice over Internet
protocol (VoIP) and broadband over cable modem are all affecting traditional
business. In neutralising these trends, telecom operators are looking to
create additional revenue streams through the delivery of new services. The
distribution of television over Internet protocol, or IPTV, is one such
value-added service that is expected to address the issue of retaining the
customer base while also generating new revenues.
This Frost & Sullivan research service is an analysis of IPTV markets in
Europe and telecom operators' strategies. It addresses the challenges in
deploying television-over-broadband solutions, particularly from the incumbent
service providers' point of view and delves into the elements of success for
the services while also estimating market penetration in Europe. Further, it
also looks at current and announced IPTV deployments throughout the continent,
analysing in detail the strategies of some of the leading operators.
Technological Advancements and End-user Readiness Facilitate the Introduction of IPTV
Apart from improvements in digital video compression standards, advancements
in digital subscriber line (DSL) equipment have enabled the delivery of high
quality video over the telephone line. This means that the telecom operators
can now enter the television distribution market and offer triple play, which
is telephony, data access and entertainment, over the same access. Also,
end-user experience with high-speed Internet and video streaming over the
Internet, among other Internet applications, has helped prepare the subscriber
for other services to be delivered over their broadband access. In other
words, technological advancements and end-user market readiness are positively
facilitating the introduction of IPTV services by telecom operators.
However, offering IPTV involves not only network upgrades, but also securing
premium content for distribution. "Resolving operational, billing, and
management integration issues, and providing a satisfactory user interface are
key aspects that could dictate the success of the service," says the analyst
of this research service. "Other issues range from bandwidth aggregation and
transport to wiring the house for a new service and all of these represent
challenges for operators entering unfamiliar territory."
IPTV could Drive Broadband Penetration beyond PC Penetration and Internet Access
Broadband penetration has reached saturation levels in some European
countries, and other countries in the region are fast nearing these levels.
Considering this, television over broadband is expected to largely help
telecom operators break the barrier for broadband penetration built by PCs and
Internet usage. In ensuring this, service providers will need to procure
quality content from major studios and producers along with exclusive sports
material. This is important in order to launch the service and differentiate
it from that of cable operators.
"Incumbent telecom operators began rolling out triple play services at the end
of 2004 and in the beginning of 2005, with France Telecom, Telefonica of
Spain, Telecom Iceland and TeliaSonera in Sweden being among the first to
commercially deploy television over broadband," says the analyst. "Telecom
operators launching IPTV can make it a success if they deliver a service that
is truly differentiated from that of cable operators, not only in content, but
also in applications, customer service and overall user experience."
Table of Contents
1. Executive Summary
2. Introduction
- 1. Introduction
- 2. Defining IPTV
- 1. What's IPTV?
- 2. IPTV Services and Applications
3. Telecom Operators' Competitive Landscape
- 1. The General Environment
- 1. Incumbent Telecom Operators' Market
- 2. Telecom Operators Revenue Streams from Traditional Businesses
- 3. Wireline Decline
- 4. Customer Churn
4. Triple Play In Europe
- 1. Triple Play Environment
5. TV Delivery Platforms
- 1. Main TV Platforms in Europe
6. The Strategic Importance of Triple Play
- 1. Introduction
- 2. Main Drivers for Incumbent Telecom Operators
- 1. Access Market Competition
- 2. Reduce Churn
- 3. Increase Broadband ARPU
- 4. Increase Revenue
- 5. Maintain Wireline Penetration
- 3. Market and Technology Readiness
- 1. Consumer Readiness
- 2. Technology Readiness
- 4. Restrainers
- 1. Bandwidth Demand
- 2. House Wiring
- 3. End-user Experience
- 5. Target Markets
- 1. Defining the Target Market
7. Delivering IPTV
- 1. Overview of Main Technologies Being Deployed in Europe
- 1. The End-to-end IPTV Network
- 2. The Headend Office
- 3. Video Compression
- 4. The Transport Network
- 5. The Access Network
- 6. The Importance of Video Compression and Bandwidth in the Access
Network
- 7. In the Home
- 8. The Middleware
- 9. Main Technology Providers
8. Hurdles in Delivering IPTV
- 1. Regulatory Environment
- 1. Will There Be Any Regulatory Issues?
- 2. Content
- 1. Introduction
- 2. Content Agreements
- 3. Content Security
- 3. Billing and Operations
9. Country Overview
- 1. Introduction
- 1. IPTV Deployments in Europe
- 2. Country Analysis
- 1. Belgium
- 2. Denmark
- 3. Italy
- 4. The Netherlands
- 5. Norway
- 6. Sweden
- 7. Switzerland
- 8. United Kingdom
10. Conclusions
- 1. Integrating Telecom and Entertainment Services
- 1. Is IPTV Viable in Europe?
- 2. Conclusions
11. Frost & Sullivan Awards
- 1. Introduction
- 1. Introduction to Frost & Sullivan Awards
- 2. Frost & Sullivan Awards
- 1. Frost & Sullivan Award for Brand Development Strategy Leadership
- 2. Frost & Sullivan Award for Business Development Strategy Leadership
