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Video's 'Third Wave'

Jeff Baumgartner
6/25/2010

8:45 AM -- ATLANTA -- Cable Next-Gen Video Strategies -- Cable may have given IPTV The Heisman in the early days as competing telcos started to adopt it, but MSOs are far more likely to embrace the technology in the coming years because IPTV now opens them up to some significant business opportunities.

That's according to Kip Compton, senior director and general manager of video and content for Cisco Systems Inc. (Nasdaq: CSCO)'s Platforms business unit, who delivered a brief keynote here to discuss the current cable IPTV market environment.

Cable, he points out, participated heavily in the First Wave of video's digital framework, with its deployment of services that use MPEG transport to drive those services to the home. But the industry largely sat on the sidelines in the Second Wave, which involved on-net, managed IPTV -- the types of services several telcos used to create video services that could match up with cable's lineup, Compton said.

"Wave 2 was almost like digital cable over IP… Fundamentally it was the same business model. There weren't a lot of new features," Compton said, noting that Wave 2 didn't give carriers a way to bring TV to the PC and to mobile phones. The Second Wave did offer a "greenfield effect" and some snappier user interfaces, but there weren't many business benefits there for MSOs to jump in and chuck their MPEG legacy. Cable, he added, was "quite comfortable skipping Wave Two, quite frankly"

Now comes the Third Wave, a tsunami that's enabling on-net or off-net video services and giving operators a way to pipe video services to TVs, PCs, and mobile devices all off a common IP platform. That work will also involve a migration to content distribution networks that can support all of those devices, and handle both linear and on-demand video.

And cable won't ignore this wave as competitors do the same and MSOs face the possibility of seeing more "cord-cutters" forgo their traditional video subscriptions and use high-speed Internet access to handle most of their TV needs. "We're not seeing cable feeling comfortable skipping Wave Three," Compton said.

But cable's IPTV migration won't happen overnight in a flash-cut. It will work it's way in slowly. Compton, however, believes cable will undertake some "pretty significant trials in 2011."

So how long will it be before cable starts to use IP as its main vehicle for video? Don't hold your breath. On a panel later in the day, execs from EchoStar Corp. LLC (Nasdaq: SATS), Arris Group Inc. (Nasdaq: ARRS), Ericsson AB (Nasdaq: ERIC), Cox Communications Inc. , and Cisco all said it would take at least four years, and possibly six, before cable gets there.

— Jeff Baumgartner, Site Editor, Light Reading Cable

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