The TV and video-over-DSL market is heating up nicely. While operators are announcing service launches and system deployments, some of the key vendors are circulating rumors about each others' product roadmaps.

Today saw a some service launches (see Occam Enables CLEC Triple Play, Nex-Tech Offers TV Over DSL, and Comcast Measures VOD Usage). And it also saw some industry scuttlebutt.

Rumor has it that Alcatel SA (NYSE: ALA; Paris: CGEP:PA) has abandoned the iMagicTV middleware it acquired for $30 million last year in favor of software from another of its acquisitions, Thirdspace (see Alcatel Finalizes iMagicTV Acquisition).

The rumor, delivered to Light Reading via email, cites two unspecified European industry sources.

Such a move would be embarrassing for Alcatel, if true, as the company is making significant efforts to place itself at the forefront of the TV/video-over-DSL systems market. It has touted the iMagicTV acquisition as a key element in its strategy, building up a 200-strong team in an effort to capture carrier business (see Alcatel Touts TV Over DSL, French Say Oui to DSL TV, and Euro Telcos Flirt With TV ).

Alcatel denies it has consigned iMagicTV's technology to la poubelle. However, the president of Alcatel's fixed solutions division, Alan Mottram, says not all of iMagicTV's software has been incorporated into Alcatel's new software solution, dubbed Open Media Platform (OMP).

Mottram says the market has developed considerably in the past six months or so, to the point where service providers planning to offer video on demand (VOD) and TV-over-DSL services now have much clearer strategies. And he contends that off-the-shelf middleware packages that have managed the delivery of TV and video streams to date, at operators such as Softbank and SaskTel, are no longer adequate.

"Carriers are now specific about the service they want to offer, and each carrier is different," says the Alcatel man. "Each service is very local and needs a significant level of customization, so the operators need a system that is very flexible" -- and interoperable with existing broadband hardware and software.

Carriers want a software system that can work with whichever set-top box vendor they choose; a system with a graphical user interface (GUI) that can be customized; and one that can deliver interactive services fom the same platform so they can offer the triple play of video, voice (VOIP), and Intenet access, he says. "These demands have driven our development strategy."

Since the third quarter of 2003 the Alcatel team has been developing its new middleware system, OMP, that is a fusion of the best elements of the iMagicTV and Thirdspace technology. This includes software that manages the delivery of the video or broadcast TV service in the carrier network and a software client that sits in the customer's set-top box.

Mottram says the set-top box element of iMagicTV's system was too restrictive, and that OMP includes the more flexible "client-side" technology from Thirdspace. That decision, which could be the source of the rumors, doesn't constitute an abandonment of the iMagicTV solution, he insists, as other elements of the Canadian vendor's system have been incorporated into OMP.

"We have taken the best assets from the two systems to create a new product that has been developed by both teams. Now we're cooking on gas, and I'm prepared to put my reputation on the line that this technology will work." [Ed. note: Career-betting ahoy! Alert the HR department!]

OMP, now in its second version, has shipped to customers, and Alcatel will announce a number of "major players" in the next two months, according to Mottram. OMP version 3.0 will be available by the end of the third quarter.

All current iMagicTV and Thirdspace carrier customers are on course to introduce OMP at some point and "no customers have been left behind in the [OMP development] process."

— Ray Le Maistre, International Editor, Boardwatch