& cplSiteName &

Competition Trumps Demand in Euro IPTV

Light Reading
News Analysis
Light Reading
1/28/2005
50%
50%

PARIS –- Europe's incumbent operators are being forced into the TV-over-DSL market by increasingly fierce broadband competition, with Sweden's TeliaSonera AB (Nasdaq: TLSN) the latest to launch an IPTV service (see TeliaSonera Offers TV Over DSL).

In much the same way that the growing service capabilities of the MSOs in the U.S. have forced the arm of RBOCs such as SBC Communications Inc. (NYSE: SBC) and Verizon Communications Inc. (NYSE: VZ), so access service competition -- rather than technological advances, revenue goals, or sheer get-up-and-go enthusiasm -- is the main catalyst for the continent's national operators to commit to broadband TV services.

That's one of the few theories that speakers and attendees have agreed upon at this week's TVoverDSL 2005 event in Paris (see Paris Presents Blurred TV Picture). Several presenters have noted that, unless there is a pressing need to invest in new systems and launch a service, Europe's major operators are still very focused on building as large a broadband subscriber base as they can muster.

To wit, TeliaSonera says its new service is available in all of Sweden's main cities as of today, covering the majority of the population, and it will reach 70 percent of Sweden's 9 million inhabitants by the end of this year.

A spokesman says the carrier has been testing the service for a few years, and has had to launch the service now because of the increasing competition in the broadband market.

That competition is coming largely from the national cable company, com hem AB, which was spun off by Telia when it merged with its neighbor, Finland's Sonera (see TeliaSonera Sells Cable TV Biz). But the incumbent also faces pressure from specialist service providers such as Bredbandsbolaget AB (B2), which has grown its broadband base to about 25 percent of the market through an acquisition, and which recently launched its first video service, Broadband Cinema (see Sweden's B2 Acquires Bostream).

Telia's main technology supplier is fellow Swedish firm Ericsson AB (Nasdaq: ERICY), which has provided DSLAMs with multicasting and very high bandwidth per customer capabilities (see TeliaSonera Plans Ethernet Over DSL).

Other than that, the spokesman wouldn't talk about equipment suppliers, but he did note that the software managing the service and the customer interface was developed internally by Telia's Research division. He declined to discuss TeliaSonera's IPTV uptake targets.

The Swedish incumbent isn't the first European player to step up its broadband TV plans because of competitive pressure.

France Telecom SA (NYSE: FTE) has been active in IPTV for more than a year as it seeks to prevent its customer base defecting to rivals like Iliad (Euronext: ILD), owner of triple-play ISP Free; and Neuf Telecom, which recently launched its own TV service (see French Say Oui to DSL TV, Iliad Ramps Up Broadband to the Homer, and Neuf Expands IPTV With Cisco).

Across the border in Spain, Telefònica SA, facing pressure from aggressive ISPs, is investing heavily in further broadband rollout and has been dabbling with TV and video services as part of its Imagenio multimedia service (see Eurobites: Pump Up the Broadband and Telefónica Uses Lucent/Riverstone Combo).

And others are set to follow in their wake during the next year or so:

  • Belgacom (Euronext: BELG), which faces intense competition from cable operators, is gearing up for a triple-play launch in June (see Siemens Gears Up for IPTV and Belgacom to Trial Interactive TV).
  • Swisscom AG (NYSE: SCM), also under threat from Switzerland's cable operators, is in the field trial stage at present, and has encountered some teething troubles during its launch process (see Swiss IPTV Trial Hits 'Glitches').
  • Telecom Italia SpA (NYSE: TI) is putting Microsoft Corp.'s (Nasdaq: MSFT) IPTV solution through its paces, and is experimenting with what people at the Paris event call a "hybrid" broadband TV service (see Microsoft IPTV: Now That's Italian!). A hybrid broadband TV services is where the TV channel comes over the air, and the DSL line provides the uplink for interactive services, such as voting in talent shows, and video on demand. That way, fewer bandwidth-hungry signals pass down the DSL connection.
Other operators, meanwhile, are more cautious. BT Group plc (NYSE: BT; London: BTA), which has faced triple-play competition from the U.K.'s cable companies for years, is testing out multiple systems in its labs, but doesn't see itself delivering the standard, already-available TV channels over its DSL lines any time soon (see BT Puts IPTV to the Test). It has other things to occupy its time. (See BT to Extend M&A Spree, Probe Pokes at BT's Tax History, and BT Faces 21st Century Dilemma.)

And in Norway, Telenor ASA (Nasdaq: TELN) doesn't face any fierce competition on its home turf, though it has still trialed and tested the technology and services.

However, it has no plans to launch a commercial service until at least 2006, or even later, according to the operator's director of broadband development, Hans Henrik Westberg. He told the Paris conference that the business case is still not clear, and that there are still technical problems to be overcome. In the meantime, Telenor will concentrate on maximizing its broadband penetration.

And what of German powerhouse Deutsche Telekom AG (NYSE: DT)? Many view Germany as one of the most closed markets, where the incumbent reigns supreme, facing few true competitive threats.

But that could be about to change. Dr Erik Lenhard from Solon Management Consulting told the conference here that DT would have to start moving on a broadband TV strategy soon, as the country's cable operators, currently in disarray and offering hardly any threat to DT's broadband hegemony, are gearing up for aggressive broadband access and VOIP rollouts that could start hitting the incumbent hard as soon as 2007 (see Euro Giants Buy Back Offspring).

In the longer term, IPTV executives believe all the incumbents will have no choice but to launch TV and video services if they want to hold on to their customers.

"Incumbents that don't move into this market in the next 10 years will lose direct contact with subscribers and become little more than transport pipes," reckons Tomas Duffy, CEO of Swedish optical equipment vendor Net Insight AB (Stockholm: NETI-B).

— Ray Le Maistre, International News Editor, Light Reading

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Educational Resources
sponsor supplied content
Educational Resources Archive
From The Founder
Light Reading today starts a new voyage as part of a larger Enterprise.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
LRTV Interviews
No Stopping Cable's Ethernet Gains

12|9|16   |     |   (0) comments


Vertical Systems' Erin Dunne explains why US cable operators, which now command a record-high 26% of the Ethernet market, will keep boosting their share.
LRTV Interviews
Fixing IoT Security Is an Ecosystem Challenge

12|9|16   |   05:34   |   (1) comment


Level 3 Communications' Chief Security Officer Dale Drew says service providers, manufacturers and even consumers must combine to halt massive DDoS attacks using IoT devices in botnets. The solution he has in mind includes reputation-based routing by the service provider but also more secure endpoint devices and greater consumer awareness.
LRTV Interviews
Cox Clears $2B in Business Revenue

12|8|16   |     |   (0) comments


Cox's Jeff Breaux discusses how the third-largest US MSO will reach the $2 billion revenue mark this year and plans to hit $3 billion by 2021
LRTV Interviews
Can Cable Climb Upmarket?

12|7|16   |     |   (0) comments


Carol Wilson and Alan Breznick assess cable's prospects for winning more enterprises in a landscape rocked by corporate M&A activity.
Women in Comms Introduction Videos
TalkTalk Exec: Find Your North Star at Work

12|7|16   |   3:38   |   (1) comment


Women need to find their purpose, a professional North Star, and create a personal board for themselves, according to Alex Tempest, director of partners at TalkTalk Business.
LRTV Interviews
Verizon: Beware Unknown Unknowns

12|7|16   |   04:58   |   (0) comments


Chris Novak, director of the Verizon Enterprise Solutions Risk Team, explains that enterprises who don't conduct a thorough audit of their assets often leave some things unprotected because they don't know they exist. Many times these unprotected assets are part of corporate M&A activity but left unshielded they can become a hacker's playground, he tells Light ...
LRTV Interviews
ETSI's CTO Talks NFV, 5G & NGP

12|5|16   |   09:45   |   (0) comments


Adrian Scrase, CTO at standards body ETSI, talks about the various initiatives and specifications developments related to NFV, 5G and NGP (next-generation protocols) that will underpin next-gen networks.
Women in Comms Introduction Videos
Korn Ferry Consultant: How to Find, Cultivate & Be the Best Talent

11|30|16   |   4:10   |   (2) comments


Erin Callaghan, a managing consultant for Korn Ferry Futurestep, shares strategies for companies to improve how they recruit and for women to ensure they don't get lost in the pipeline.
LRTV Custom TV
We Can Make the World More Sustainable

11|29|16   |     |   (0) comments


GeSI is a global e-Sustainability Initiative organization bringing together 40 big multinational companies around the world. According to GeSI's report, information and communication technology can make the world more sustainable. Luis Neves, chairman of GeSI, shared with us his opinion at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
Finding a New Way to Engage Customers & Drive Revenue

11|29|16   |     |   (0) comments


Mobile revenues are declining. Digicel, a player in the Caribbean telecommunications/entertainment space, has found a new way to engage customers and drive revenue. John Quinn, CTO of Digicel, shared with us its story at Ultra-broadband Forum (UBBF2016)
LRTV Custom TV
Do You Really Need Gigabit Infrastructure?

11|29|16   |     |   (0) comments


Altibox is the biggest fiber-to-the-home (FTTH) player and the largest provider of video and TV in Norway. They started out with zero customers in 2002. Now they have close to half a million households and companies attached to their FTTH business. Nils Arne, CEO of Altibox shared with us their story and insight on 5G at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
BTís Openreach Strategy & Its Updates in 2016

11|29|16   |     |   (0) comments


A lot of developments at Openreach this year in terms of strategy and planned investments. Peter Bell, CIO of Openreach BT, shared with us the updates of Openreach at Ultra-broadband Forum (UBBF2016).
Upcoming Live Events
May 16-17, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
Hot Topics
Cable Nodes Becoming a Choke Point
Brian Santo, Senior editor, Test & Measurement / Components, Light Reading, 12/5/2016
Consolidated Snaps Up Fairpoint for $1.5B
Iain Morris, News Editor, 12/5/2016
Small Arctic ISP Caches Netflix in New Way
Mari Silbey, Senior Editor, Cable/Video, 12/7/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Eyal Waldman, CEO of Mellanox Technologies, speaks to Steve Saunders, CEO of Light Reading, for an exclusive interview about the 100 GB cable challenge, cybersecurity and much more.
Join us for an in-depth interview between Steve Saunders of Light Reading and Alexis Black Bjorlin of Intel as they discuss the release of the company's Silicon Photonics platform, its performance, long-term prospects, customer expectations and much more.
Animals with Phones
A Mobile Safari Click Here
Literally.
Latest Comment
Live Digital Audio

Even when there's a strong pipeline of female talent in the comms industry, it tends to leak all the way to the top. McKinsey & Company says women experience pipeline leakage at three primary points: being unable to enter, being stuck in the middle or being locked out of the top. Each pipeline pain point presents its own challenges, but also opportunities to stop the leak. Wireless operator Sprint is making a conscious effort to improve its own pipeline from new recruits to the C-suite, and it wants the rest of the industry to do the same. In this Women in Comms radio show, WiC Board Member and Sprint Vice President of Enterprise Sales Nelly Pitocco will give us her take on the industry's pipeline challenges. Pitocco, who joined Sprint in May and has spent 20 years in the comms industry, will also offer solutions, share how Sprint is tackling the challenge within its own organization and take your questions live on air.