Although Lucent had its own IPTV middleware, developed with one of the world's largest telcos, the new Alcatel-Lucent (NYSE: ALU) is sticking with Microsoft Corp. (Nasdaq: MSFT)'s software as the platform it will pitch to the world's network operators. (See Alcatel, Microsoft Confirm IPTV Deal.)

In an exclusive interview with Light Reading at the TVoDSL event in Paris, Tiaan Schutte, VP of Alcatel-Lucent's Information, Communication & Entertainment (ICE) business unit (and almost certain to be nicknamed “The ICE Man”), said Microsoft was the vendor's choice as he laid out his company's plans for addressing the IPTV needs of its carrier customers.

Those plans don't involve the expanded development of the Imagenio IPTV middleware platform that Lucent took on from Telefónica SA (NYSE: TEF) in April last year, and which then became the foundation of Lucent's MiViewTV multimedia services delivery platform launched last October. (See Lucent, Telefonica Team on IPTV and Lucent Unveils MiViewTV.)

The Imagenio platform, developed internally by Telefónica and now supporting more than 300,000 IPTV customers in Spain, also underpins the Spanish giant's O2 TV service in the Czech Republic. (See Telefónica Busts Its 2006 Targets and O2 Touts IPTV Growth.)

Schutte, who joined Alcatel when it acquired Thirdspace [originally an Alcatel/Oracle Corp. (Nasdaq: ORCL) joint venture] in 2003, says that while Alcatel-Lucent will fulfill its obligations to Telefónica, the Imagenio platform will not be developed into a home-grown alternative to the Microsoft platform.

"Microsoft is the leading platform for Alcatel-Lucent," says Schutte. "We will continue to develop features for Telefónica -- those obligations are being met." (See Small IPTV Carriers Find Life After Alcatel.)

He added that the company will also fulfill its obligations to customers using the Open Media Platform (OMP) that Alcatel had developed internally before the Microsoft partnership.

Rather than doing more work on IPTV middleware, Schutte says Alcatel-Lucent's main focus will be on developing applications. The vendor's existing AmigoTV and MyOwnTV applications, as an example, can run over multiple video delivery platforms, and on systems that will allow carriers to include personalized advertising as part of their service offerings. (See Alcatel Unveils IPTV Apps.)

Alcatel-Lucent's commitment to Microsoft's platform shows just how much of a hold the software giant has on the IPTV developments of major carriers. The Microsoft IPTV Edition platform is now in commercial deployment at AT&T Inc. (NYSE: T) (formerly SBC), BT Group plc (NYSE: BT; London: BTA), Deutsche Telekom AG (NYSE: DT), and Swisscom AG (NYSE: SCM), as well as some smaller operators, and is in trial at a number of others. (See SBC Awards Microsoft $400M IPTV Deal , Swisscom Finally Launches IPTV, BT Unveils IPTV Service, TI Develops IPTV With Microsoft, Alcatel and Microsoft Win Danish IPTV Order, Microsoft Wins IPTV Deal at DT, Club Internet Unveils IPTV , SingTel Tunes In to IPTV, and Microsoft Adds Three for IPTV.)

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Microsoft's IPTV Edition incorporates client and server-side middleware, digital rights management (DRM) software for content protection, and a video-on-demand delivery and management system that runs on HP Inc. (NYSE: HPQ) servers.

It also shows that the current legal dispute between Alcatel-Lucent and Microsoft has not yet soured the relationship, at least publicly. (See Quantum Bridge Goes Gig-Ethernet.)

However, Microsoft's place at the top of Alcatel-Lucent's "go-to-market" list won't last forever. "IPTV middleware isn't going to cut it in three to five years' time. It's going to be about more than just that," says Schutte.

The bigger picture, Schutte says, is that Alcatel-Lucent will develop a single, converged platform that will enable the delivery of multiple services over fixed and mobile networks. That platform would incorporate capabilities such as security and content sharing and middleware such as Microsoft's IPTV system could be one of its components, says Schutte.

New Content Business Unit
Alcatel-Lucent has also created a new business unit that's focused on aggregating content (video, games, music, karaoke-on-demand playlists, and so on), which can then be packaged and delivered to service providers. Alcatel-Lucent isn't getting involved in content creation itself, but the company sees a big opportunity in the Tier 2 and Tier 3 carrier sector, where service providers don't have the people or experience to deal with content owners themselves.

This new content business unit won't just help in delivering the content, but it will help service providers to build additional services from that content as well, says Schutte. As an example, he offers that a service provider could create an application where, when a music video is viewed on TV, customers could press a button and order that same tune as their mobile ringtone, and the charge would show up on the customer's monthly services bill.

"Access to content is a very difficult part of the process for carriers," notes Schutte. That view was also expressed at the Paris event by Orange (NYSE: FTE) executive Benjamin Schwarz, who says FT hired 30 content specialists to help build its IPTV service, which now has 600,000 subscribers.

Schutte says he's also looking to get into the IPTV managed services game, "a model that's being pursued quite aggressively in the mobile TV market," where, he says, Alcatel-Lucent has already had some success, most notably with T-Mobile Germany .

User-generated Content
Alcatel-Lucent is keen to enable users to share their own video content. Its MyOwnTV application, which allows closed groups to create their own TV channels and upload their own content, already enables this. That service has been trialed under carefully controlled conditions in the Belgian town of Lommel, while further trial announcements are due in the next few weeks, says Schutte. (See Waiting for My Own TV.)

"Carriers are excited about the ability of self-expression -- they have seen the interest in YouTube, MySpace," and other video sharing sites, says the ICE Man. (See Web Video Cheat Sheet.)

— Ray Le Maistre, International News Editor, Light Reading