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Softbank Focuses on UTStarcom's mVision

Light Reading
News Analysis
Light Reading
7/6/2005
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Japan’s largest broadband provider, Softbank BB Corp., has been busy building its new IPTV offering, BBTV, using UTStarcom Inc.'s (Nasdaq: UTSIE) mVision solution, the equipment vendor announced Wednesday (see UTStarcom Wins (Again) at Softbank BB).

The new IPTV service is the third product in a triple-play bundle to be delivered over Softbank BB’s widely popular Yahoo! BB broadband service. BBTV will feature 28 live broadcast channels and more than 5,200 video on demand (VOD) movies, UTStarcom says.

The account looks to be a “showcase” account for UTStarcom’s IPTV solution (see China's 'Big Three' Eye IPTV). At the end of March, Softbank BB had 4.8 million Yahoo! BB ADSL lines installed. More than 4.5 million people had registered to use Yahoo! BB’s VOIP service, called “BB Voice.”

UTStarcom and Softbank BB have apparently been working on the new service for some time; the BBTV service was already available in some form in 23 Japanese districts by the end of last year, according to a Softbank BB statement.

UTStarcom’s history with Softbank runs deeper than just their vendor-customer relationship. Softbank BB was UTStarcom’s first Japanese customer and began buying access equipment as early as 2001 when the Yahoo! BB service was launched. UTStarcom says Softbank BB is now a 12 percent owner in the company, but Softbank BB has owned as much as 45 percent of the vendor in the past.

The Softbank BB deal represents the choice of a yet another large operator to go with an end-to-end IPTV solution, this time courtesy of the incumbent access equipment supplier (see Siemens Snaps Up Myrio and UTStarcom Jumps on Pedestal ). UTStarcom will provide all pieces of the IPTV distribution chain from the headend encoders to the video servers to the set-top boxes, as well as the mVision middleware that glues the whole works together (see IPTV: Microsoft's Window to Carriers).

The major pieces of the mVision platform include a set-top box called a “Media Console” for decoding video at the home; a server called “MediaSwitch,” which is used at the headend and at aggregation points for streaming and storing video; and a “Content Engine,” which encodes video streams at the headend. The UTStarcom system is also interoperable with Harmonic Inc. (Nasdaq: HLIT) encoders, but it’s unclear whether they’ll be used at Softbank BB.

UTStarcom's mVision middleware includes an operations support system (OSS) that manages the acquisition, maintenance, distribution, and billing of streaming media for live TV, time-shifted TV, and VOD applications.

UTStarcom would release neither the size nor the dollar amount of the IPTV contract, which is only the second announced to date for the mVision platform (see UTStarcom: We’re Not the Cheapest). UTStarcom says it is working on numerous unannounced trials, however.

The Yahoo! BB broadband service is a joint offering of Softbank BB and Yahoo Japan Corp. Softbank BB, which sells ISP services and ADSL line products, is the largest in a group of companies owned by Japanese conglomerate Softbank, which also owns a controlling interest in Yahoo Japan.

In a separate, but somewhat related announcement, UTStarcom says it has also extended its contract to sell its Gigabit Ethernet passive optical network (GEPON) platform to Softbank BB (see Japan Telecom Expands With UTStarcom).

Softbank BB will use the hardware to deliver its new FTTH service, Yahoo! BB Hikari. UTStarcom’s initial GEPON contract, announced in October 2004 at the launch of the service, was worth $60 million.

The GEPON platform, which UTStarcom says comprises an optical line terminal and an optical network unit, is built to deliver high-speed voice, data and video services over fiber to the home.

Yahoo! BB Hikari will likely be the preferred means of delivering IPTV service in the future. Softbank says it hopes to offer the service widely during 2005.

— Mark! Sullivan, Reporter, Light! Reading

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