Broadband TV strategies

As latecomers to the multichannel TV market, telecom operators have faced some problems to make their presence felt.

The fact that they have found it more difficult to win over TV customers than cable operators found it to win over voice and broadband users is evicìdence that TV is inherently more complex, both technically and commercially, than the other parts of the triple-play and also perhaps that people tend to be more conservative when it comes to TV.

Operators face a difficult dilemma. They need to deliver a service that is at least the equal of cable, satellite or terrestrial TV in reliability, which implies that they have to keep things simple. At the same time the are under pressure to offer something distinct from the TV services that already exist in order to get people to make the switch which implies experimentation and complexity.

The jury is still out on what that dstinctiveness might mean in practice. This could include elements such as a much more intense degree of personalisation of TV, the merging of video with voice and data services, and the deliver of video services to a range of devices within the home and outside it, and the opening out of their TV platforms to Internet-based content providers. But technical complexity and uncertainty about what consumer might actually want remain as significant hurdles.

Telecom operators are still experimenting with different models to make IPTV works. But elements of a strategy that brings TV together with communication services are emerging.

Telecom operators which have entered the IPTV business over the last few years have tipically deployed IPTV in terms of the triple-play concept pioneered by the cable industry. IPTV in this context is seen as a way to counter the long-term decline in voice revenues through commodisation, voice competition from cable and fixed-mobile substitution.

With this in mind, telcos have typically launched IP-based walled-garden pay-tv services, supplemented by video-on-demand to compete directly with existing pay TV services. Differentiation has been achieved by way of competitive pricing and packaging.

More info in the Annual Report Turning Digital - A changing TV world