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India's Telcos Watch MTNL for IPTV

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India's major telecom operators are all flirting with the idea of offering IPTV services but state-owned Mahanagar Telephone Nigam Ltd. (MTNL) looks set to be the first out of the gate with a commercial service, aiming for a late May/early June launch date.

The carrier has enlisted content aggregator Time Broadband Services Ltd. to do the legwork in pulling together the video equipment, middleware, content, and billing systems, and so on, leaving MTNL to provide the distribution network. The companies have signed a seven-year revenue sharing agreement that essentially gives Time Broadband a franchise to run the service over MTNL's broadband connections.

For the trial stage Time Broadband has lined up Optibase Ltd. (Nasdaq: OBAS) to provide its MGW 5100 platform in the headend, which offers MPEG-4 broadcast and video-on-demand streams with capabilities for PVR and time-shift services. (See MTNL Uses Optibase.)

Infogate Online Ltd. is providing the middleware, Verimatrix Inc. the content protection, and Amino Technologies plc (London: AMO) and Softier Ltd. the set-top boxes. As Time Broadband's systems integrator, HP Inc. (NYSE: HPQ) is touting its involvement in providing service creation, configuration, and management tools. (See HP Touts Contracts.)

Optibase's marketing VP Lior Fite says that the pilot is small -- involving just a few hundred subscribers -- but the project has drawn attention throughout India's telecom industry, "especially after the failure of Atlas."

Early last year Atlas Interactive spent over $200,000 on IPTV equipment from ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763), in addition to deals with Orca Interactive Ltd. , Tandberg Television , and BigBand Networks Inc. (Nasdaq: BBND), but the service has never seen the light of day. (See ZTE Provides Gear, Finance to Atlas, BitBand Lands Indian IPTV Deal, Tandberg Ships Indian IPTV System, and Orca Wins IP TV Deal in India.)

That experience raised doubts about the viability of IPTV in India, but the country's telecom market has grown exponentially since then and operators are making a push towards expanding their broadband networks. "We feel that if MTNL will go right, India will be a big market for us," says Fite.

Industry scuttlebutt has it that MTNL is not entirely happy with the trial so far and is working to fine-tune the system to improve the quality.

But Tonse Telecom analyst Sridhar Pai reckons whatever the outcome of this trial MTNL is best positioned to get a commercial IPTV service up and running before any of India’s other carriers.

Bharti Tele-Ventures Ltd. is trialing UTStarcom Inc. (Nasdaq: UTSI) equipment and plans to launch a service in the second half of this year. (See Bharti Watches UTStarcom for IPTV.) Reliance Communications Ltd. and Tata Teleservices Ltd. are also gearing up their IPTV plans. But while they're trying to tackle the country's lack of fixed-line infrastructure, "MTNL has taken care of the access bandwidth requirements better than anyone else," Pai says.

That's because the Indian government has limited MTNL's network coverage to the New Delhi and Mumbai areas while Bharat Sanchar Nigam Ltd. (BSNL) , the other state-run carrier, operates in the rest of the country. That gives MTNL, which has a total of 3.9 million telecom subscribers, the advantage of focusing on a small regional network with a large urban population.

The carrier is deploying Ericsson AB (Nasdaq: ERIC)'s ADSL2+ kit to upgrade its broadband network and bring access speeds up to the task of carrying video streams. The plan is for the service to go live first in New Delhi, then in Mumbai later this year. If all goes well it wants to expand into Ahmedabad and Bangalore.

The government is also keen on BSNL rolling out IPTV, but the operator remains preoccupied with evaluating bids for its monster $4 billion wireless contract and is less focused on its fixed-line network. (See BSNL: Love Me Tender!)

Still, it's certainly keeping an eye on MTNL's project. Optibase's Lior Fite predicts BSNL "will follow the footsteps of MTNL and franchise to Time Broadband... They'll probably create a copy [of the network] and go with the same vendors -- after going through all the suffering to integrate all the different systems."

— Nicole Willing, Reporter, Light Reading

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User Rank: Light Beer
12/5/2012 | 3:55:48 AM
re: India's Telcos Watch MTNL for IPTV
Vendors beware of what you step into. It's a state owned carrier full of bureacracy, s l o w decision making and totally clued out about recent market developments and decades away from the concept of customer satisfaction. They're also infamous for coming out with tenders that go nowhere. And by the end of it you will definately lose your shirt because you will be trapped inside a black hole.
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