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I Want My IPTV

Each day, the YouTube website serves up more than 70 million videos, most of them homemade. Much of the appeal is having access to a wide variety of content ? more than what's provided by any cable or satellite service. A new ecosystem called Internet Protocol Television (IPTV) could have the same impact on the commercial and enterprise AV markets.

Each day, the YouTube website serves up more than 70 million videos, most of them homemade. Much of the appeal is having access to a wide variety of content — more than what's provided by any cable or satellite service. A new ecosystem called Internet Protocol Television (IPTV) could have the same impact on the commercial and enterprise AV markets.

In the telecom industry, the term IPTV is practically synonymous with residential and consumer video because that's been the initial market. (AT&T and Verizon Communications have launched residential IPTV in a few markets, while other telcos are rolling it out abroad.) However, the infrastructure that telcos are deploying for residential IPTV eventually could be used for commercial and enterprise applications, too.

Some vendors and analysts believe that double duty is only a matter of time. One reason is that compared to existing analog and digital technologies, IPTV makes it easier and more cost-effective to deliver a wide range of content, such as 1,000 channels instead of a few hundred. On the residential side, the extra bandwidth might be devoted to niche plays such as The Knitting Channel. In the commercial space, it could be used for hazardous material training videos created by the federal government and accessed by hundreds of companies across the country.

Some point to services such as Muzak and the CNN Airport Network as examples of how IPTV could be used to distribute a wide range of audio and video content in the enterprise and commercial markets. How quickly that scenario becomes reality depends partly on how quickly the ecosystem of content providers and other players develops.

“It makes sense that there would be a development of commercial video networks that would serve the signage industry,” says Mark Kirstein, vice president of multimedia content and services at iSuppli, an El Segundo, CA-based research firm. “What changes with IPTV is the breadth of content options. You could have very narrowly focused business-to-business entities that are syndicating content onto an IPTV distribution network.”

Defining IPTV

Despite its name, IPTV isn't about dumping AV content into the Internet. Instead, most definitions of IPTV center around a private, managed IP network, such as one owned by a telco. That difference is key for maintaining quality of service (QoS) and security, and to ensure that delay-sensitive applications such as real-time video aren't compromised by delay and jitter.

“IPTV isn't TV over the Internet,” says Matt Cuson, vice president of marketing at Minerva Networks, a Santa Clara, CA-based manufacturer of IPTV hardware and software. “It's not YouTube. It's a managed network.”

Most definitions also center around residential services, such as video on demand and interactive TV. One place where there's disagreement is the role that service providers would play. Some vendors believe that telcos might be able to make a business case for getting into the content business, where they create and host programming for customers. “That's certainly a model that works and is potentially appealing to some smaller, local companies that don't have the reach or technical sophistication,” Cuson says.

If telcos are interested in business IPTV, they're not saying, although rumors have abounded in the telecom industry for more than a year. (One major residential IPTV provider, AT&T, declined to provide input for this article because it says it's premature to discuss any enterprise plans.) Even so, an opportunity for fatter margins is one reason to believe that they'll eventually expand into the business market. Another reason is that telcos already provide voice and data services to enterprises, so they could leverage those relationships to upsell them on IPTV. Plus, the more services that an enterprise buys from a single provider, the less likely it is to switch to a rival.

Dumb pipes?

But for now, telcos have their hands full just with residential IPTV, where iSuppli forecasts more than 63 million customers worldwide by 2010. Working out the bugs on the consumer side should mean that a business-class service would provide the reliability and QoS that enterprises expect.

“Right now, they're just trying to make it work,” says iSuppli's Kirstein. “Even the largest companies are struggling. On the commercial side, I think they have some time to worry about it because other things are higher priority.”

But others believe that telcos will act only as “dumb pipes.”

“I don't see the service providers engaged in anything but providing bandwidth,” says Rich Mavrogeanes, founder and CTO of VBrick Systems, a Wallingford, CT-based company that provides hardware and software for enterprise multimedia. “There's no value that they could, would, or should add. Their view of IPTV is a division of video-centric guys managing servers and billing customers for viewing it.”

In fact, Mavrogeanes is so adamant about telcos playing only a supporting role that he eschews the term IPTV in favor of “EtherneTV.” Besides being the brand name for VBrick's products, Ethernet is synonymous with enterprise in Mavrogeanes' eyes.

“The term IPTV has pretty much come to mean telcos and cable operators chasing a pot of gold at the end of the rainbow to provide entertainment to consumers,” Mavrogeanes says. “I like ‘Ethernet' because it connotes ‘enterprise' as opposed to public Internet.”

New systems, new strategies

Whatever the terminology, business IPTV is likely to span a wide variety of content and platforms. For example, it could be used so that employees at a brokerage can watch Bloomberg Television and the lobby security camera to see when their pizza arrives, all from their PC.

“I can also browse through all of the stored content, such as the human resources discussion of the 401(k) benefits plan, or how to assemble a widget,” Mavrogeanes says.

In smaller businesses, such as a sports bar or furniture store, IPTV could be relatively straightforward. “It's going to be DSL or fiber and a terminating box,” says Minerva's Cuson. “Then it's just Ethernet out, so you run Cat5 or whatever to the locations.”

IPTV should create more customization options for customers and whatever company is providing service. For example, a telco that successfully displaces a cable operator for a hotel account could create a custom “skin,” where the channel guide and other onscreen elements carry the hotel's logo and promotional information. The option of being able to sell advertising on that skin could help hotels make the business case for going with IPTV. That flexibility highlights how IPTV is different from conventional cable TV, where there are fewer options for customization.

“We're taking advantage of a one-to-one network,” Cuson says. “Everything delivered to that set-top box can be uniquely configured for that set-top box.”

Many companies are already showing interest in the ability to offer customers and patrons a wide range of multimedia information. “Most of the questions come from hospitality,” Cuson says. “But some furniture stores have asked about it, such as for being able to play a video about how a bed is manufactured.”

That application is doable today, such as by burning the video to a DVD and then running it on a TV with a built-in DVD player. But larger chains might want more programming flexibility and the ability to use a wider range of displays.

“In that case, you'd build an on-demand video system with servers in each of the stores,” Cuson says. “From the headend, you'd distribute the video-on-demand (VoD) content to each of the stores, and run the service centrally. Employees at the store can then scroll through the VoD module to find what they want. From the head-end, you can prepare a playlist of videos and have those running on a ‘channel' but served from the VoD server.”

In an office building or campus, the same IPTV system also could be used to conduct videoconferencing. With all of those potential applications, AV pros' sales strategies will have to change. “It needs to be sold at the C level as opposed to the security guy, who doesn't care about training videos,” Mavrogeanes says.

Business IPTV also would hasten a trend that's already well underway: the convergence of AV and IT. Knowledge of networking technologies and terminology already is key to getting along with a client's IT staff, and the more an integrator knows, the more value it can offer — with the ability to price accordingly.

“Most successful AV integrators are already doing IP stuff,” Mavrogeanes says. “They can do better. They need to do better. These are absolutely mandatory skills. You can't be in ‘I-just-sell-projectors-and-coax-cable' mode.”

Tim Kridel is a freelance writer and analyst who covers telecom and technology. He's based in Kansas City and can be reached at tkridel@kc.rr.com.



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