After launching the IP Television Magazine, interviews were conducted with a variety of hundreds of companies.
These companies differed from service providers to manufacturers. Reader surveys were also performed in order to establish which type of difficulties were facing the IPTV industry.
Although all these difficulties can be resolved, they will have an influence on the distribution of IP Television services & systems.
1. IPTV: A Substantial & Unknown Industry:
We found that there is an unawareness about this multibillion dollar industry amongst both companies and people. This leads to great opportunities provided to innovators whilst established companies are left behind.
During our research we found that despite the general unawareness among companies & people, even IPTV-users were not clued up about it. Billions of dollars were either committed or spent on the distribution of television via IP data networks.
Copyrights and patents (intellectual property) were created by innovative IPTV Developers & implementers. This will create a stumbling block for companies which will be entering late into the IPTV market and may struggle to adapt to this new industry.
From the start of 2005, IP Television services were offered by over 250 systems to 2.1 million IPTV-customers.
Over 25 companies are manufacturing top boxes for IP at an affordable cost.
Interviews conducted during June 2005 at Supercomm, service providers of broadband communication, it was found that more than 15% of service providers & telephone equipment were using some type of IPTV technology.
2. IPTV Congests Interconnecting Data Pipes:
IPTV of standard quality which is the same as the quality of analog television, operates at over 240 times the capacity bandwidth in comparison with voice & Internet browsing-services.
The patterns of data usage differs for television. Network capacity is expensive, thus IPTV signals congests certain backbones when it comes to the more enhanced high performance broadband networks.
An ordinary consumer’s telephone service usage is about 60 minutes on a daily basis.
A voice channel’s data transmission rate is 64-kbps in both directions equalling to 128-kbs combined.
Thus, a consumer will use about 58 MB in a day.
The Neilsen ratings revealed that the general Internet consumer will be browsing the Internet for about 28 minutes on a daily basis which is about 14 hours on a monthly basis.
If the typical broadband consumer has 10% activity, transferring actual data, their data consumption is 200 kbps on average, which leads to consuming about 42-MB per day.
As per the Neilsen ratings, an ordinary household watches television for about 8 hours daily. IPTV MPEG-2, standard quality, consumes about 4 Mbps. This leads to a consumption of about 14.4 GB on a daily basis.
This implies that the consumption of IPTV data is about 240, for rather short times of seconds – minutes long, whilst their consumption is allocated throughout a whole day.
This permits the carrier (service provider) to allow various consumers sharing every communication channel. For instance, to load the system with about 5 to 20 clients per high speed-data channel or per communication line.
Television viewers, contrary to Internet data or voice consumers, generally watch TV channels simultaneously as their neighbours for lengthy periods, especially at the end of their work day.
This will result in an increase of the system’s capacity requirements, whilst the amount of clients will be lowered who could share the very same network channels; which means a reduced loading ability.
Another problem is that a viewer may leave the top box of the IP set in receiving mode, by not switching it off. This means data will be received even when the TV is switched off, taking into account that there may be various IP set top-boxes in every home.
3. Cost Quality: Tradeoff
Contrary to broadcasting television companies which are using a regular signal format, the PITV service providers will be able to trade off service and video quality in an attempt to make the cost of bandwidth more affordable.
However, this can result in damaging effects when it comes to how the quality of the IPTV is observed.
However, what is beneficial is that the introductory IPTV implementers are cable television systems & telephone companies. They have the ability to control the bandwidth, whilst the original quality of the IPTV service is comparatively high.
With the transformation of the IPTV industry, ITVP’s (Independent Internet television service providers) can be enabled to supply television services via broadband connections.
It is up to such companies to determine the amount of bandwidth & quality they will be distributing to the client.
During 2005, data transfer fees regarding ISP (Internet service provider) for connecting to the Internet was about 5 US dollar per 100 GB – $.05 per GB.
Streaming data transfer fees are 4.0 Mbps or 500-kBytes per second – 8 bits for one Byte,for a regular TV-quality digital video signal. For a movie of 2 hours the data transfer rate will be 30 MB for 1 minute x 120 (or 3.6 GB).
However, the television channel’s data transfer rate can be reduced saving data transfer cost.
IP Television of medium quality, data rates vary from 500-kbps – 1.5-Mbps, whilst that of of low quality, data rates vary from about 100 – 500-kbps.
Below is a table which illustrates how an IPTV service provider is able to trade-off quality for decreased cost and approximately shows the cost for the transfer of digital video to end clients via the Internet.
QUALITY TRANSFER COSTS / HOUR TRANSFER RATE
Low (very) 0.2 cents 56-kbps
Medium / Fair 1 cent 500-kbps
TV-quality 9 cents 3800-kbps
4. Content is King
Although content is indeed king, it is also expensive. Program content is of high importance to television systems.
Licensing rights for sending content to television networks are expensive to the extent that it usually will make up 30 to 50 percent of television service providers’ gross revenue.
The customary IPTV service rate plan provides content from local programming.
The initial IPTV services providers detected some of the issues to obtain the programming which their viewers favoured.
Although viewers were supplied with access to PPV (more pay per view). It shows they opted for local programming channels.
A lot of IPTV service providers offer local programming channels, with unlimited viewing which forms part of their key rate plan.
TABLE OR GRAPH
This figure shows the regular IPTV system’s rate plan. In this example you can see that an ordinary IPTV service’s rate plan comprises of various free local & regional channels. These channels are paid for on a monthly subscription basis whilst a lot pay for per view channels.
5. A Key Driver: Targeted Advertising
IPTV operators can get their revenues from usage & subscription fees as well as advertising.
An additional advantage for IPTV is the ability of sending advertisements to particular IP-set top boxes as every IP-set top box features a distinctive network address.
Advertising revenue can be greatly increased by this addressable advertising, whilst impression ads can exactly reach their market matched audiens.
IPTV systems which can establish detailed profiles of their clients’ personal and viewing preferences, can potentially increase their per impression advertising revenue by an accumulative of at least 10 or more!
6. Broadcast Regulatory Favouritism
The present regulatory domain regarding television systems was designed for the broadcasting television industry.
Thus, these regulations can limit or prevent IPTV service providers to provide certain kinds of services.
What cable, television & satellite broadcasters find frightening is that these IPTV service providers’ programming networks have the ability to bypass conventional networks.
It means that the major network operators may lose their control over the allocation of media channels.
Customers can not just bypass the telephone & cable programming networks; the ITVPs (Internet television service providers) have the ability to use the high-speed portions of such networks bypassing their own broadcasting networks.
Due to this fear, broadcast companies may inquire regulatory protection from their governments. This will give them time to set up their own IPTV-systems and get it operating efficiently.
Domestic competition may be restricted by regulation, until preferred status for new kinds of IPTV providers, can be implemented.
This will enable international companies to compete more efficiently against the existing broadcasters.
7. Content Restrictions & Ratings
Rating and restricting the content available on IPTV channels will become more difficult.
Therefore, one country’s media regulation authorities will not have much control over channels which are broadcasted through broadband Internet connections to other countries.
Contrary to web pages which can be monitored easily by their keywords, the detection of undesired kinds of content like violent & adult content will be more difficult in streaming media.
Television programs come with meta tags which describe the content, there are typical formats for such meta tags.
However, service providers can edit such meta tags, which they frequently do, by a more favourable description to market these television programs to viewers.
Viewers will be able to view any IPTV channel. However, some clients will choose an IPTV service-provider which restricts or allows access to the viewer which will enable the customer to control the accessibility to violent or / and pornographic content.
8. Time Zone Challenges
IPTV systems can potentially reach audiences globally. Traditionally television programming was splitted into some program block times.
Such times were established upon the presumed viewing audience like children during the morning & adults during the late night.
Due to the fact that IPTV service providers may be based anywhere globally, these program time blocks have little value when it comes to programming and the presumed viewing patterns.
Some kinds of programming content which are broadcasted for a mature audience during the late hours can be inappropriate for some audiences at a fixed time during the day.
Broadcasting television systems feature good picture quality and high reliability.
IPTV system services & equipment have compatibility issues, unlike the closed broadcast TV systems.
These compatibility issues will highly likely continue through the early 2000’s.
Combined technologies are used by IPTV systems which are subjected to development & improvements.
Whilst testing the IPTV portal directories, it was observed that different media players were used by the IP Television channels which require and / or use different parameters. Due to this the viewer was unable to play certain IPTV channels.
The IP-set top box as well as its media player form an integral component of IPTV systems. Various companies are producing media players as well as their associated video-compression coders which resulted in a media player war.
The one who wins this media player war, will install their media player in practically hundreds of millions of set top-boxes. The software licensing royalties of this associated media player’s worth are estimated at billions of dollars.
10. How to Get IPTV to Your Television in Your Home
Premises distribution systems play an integral role in IPTV networks. Usually televisions are not located near to a data connector.
To receive the signal to your media appliances inside your home, you may have to rewire or / and may need additional equipment.
IPTV service providers want to sell their services to customers who can install the equipment themselves. They want to avoid sending installation workers to do the job.
However, IPTV service providers’ focal point will be premises distribution equipment which will be compatible with the existing wiring system where it is possible.
It comes as a surprise to discover that different countries also have dissimilar kinds of home distribution systems.
In the United States a major percentage of coax is installed, compared to the United Kingdom which have a greater percentage of clients who still get their television signals via RF broadcasting.
Optical cable, copper either coax or wire or wireless through IR or radio can be used for Premises distribution systems for transferring communication signals inside a client’s home.
The ordinary premises distribution systems which are used for the distribution of IPTV include coaxial cable, telephone wiring, power line distribution, wireless LAN and wired LAN.
FIGURE / GRAPH
This figure shows premises distribution systems of the ordinary kinds, which can be utilized for IPTV systems.
The diagram indicates that an IPTV signal reach the remises via a broadband modem.
The broadband modem, has a connection to a router which distributes media signals in order to forward packets of data to various devices inside the home, like IP televisions.
The example displays that routers have the ability to forward packets via telephone lines, power lines, data cables, coaxial lines or even through wireless signals unto adapters which receive the packets, whilst recreating them into a format with which the IPTV is compatible.