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IPTV versus TV-over-IP

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In the battle for video over broadband, the odds might just be stacked against IPTV, a complex and expensive technology. Instead, the fortunes might be favoring the more simplistic, television over IP.

In past few months, IPTV has gone from being an obscure acronym to a mass media phenomenon, that if you read the papers is going to solve all of world’s problems, usher a brand new television experience, and well, while its at it, help the Yankees win another dozen World Series. The coverage would make you believe that IPTV is here and now. Reality is proving to be something else.

IPTV, is the technology that is being deployed by phone companies either over copper or fiber networks to replicate (and perhaps enhance) a television experience normally available on cable networks. (Light Reading has a more indepth description for those interested.) In other words, an always on television stream (and hundreds of channels) just is available at the flick of the switch of a set-top box. This is a business that needs billions of dollars in investment. SBC, for instance is spending over $6 billion on Project LightSpeed, that will bring TV over next generation DSL connections. BellSouth is not too far behind. Verizon has similar plans and a bigger budget, for its fiber based network, called FIOS. (Thanks Karl for clarifications!)

Even with these apparently significant investments, “the Bells are five years behind the cable companies,” says Scott Cleland, founder and CEO of research company Precursor Group. “We have a cable industry that’s fully built out,” Cleland says. “Bells are a fourth entrant with three formidable players” in video entertainment.

Regardless of the underlying pipe – copper or fiber – one this is clear: the deployment of these IPTV networks is slow, laborious process. In addition, it is hard to find evidence of profits and scale. For example, Hong Kong-based PCCW is the world’s largest IPTV service and it has 441,000 subscribers in Hong Kong. The evidence of slow nature of the rollouts is evident in pre-announcements from two companies – UT Starcom and ADC Telecommunications. UTS was hit by slow ramp at Softbank Broadband in Japan, and ADC’s troubles lie at the Verizon’s feet.

Multimedia Research Group in its most recent forecast says that the total number of IPTV subscribers will grow from 3.7 million in 2005 to 36.9 million in 2009, with revenues going from $880 million to $9.9 billion in 2005-2009 time frame. That works out to about $267 a year per subscriber or roughly $22 a month. That doesn’t sound like too much money per subscriber per month, but hey that’s me. (Interestingly, IP video services in Asia Pacific will be a $4.2 billion market by 2010 as per In-Stat, a market research firm.) Bob Larribeau, MRG Senior Analyst in the press release says that Bells are “still lagging, due to issues that SBC and BellSouth are facing, waiting for low-cost MPEG-4 set-top boxes and Microsoft’s software, and dealing with the complexity of the system integration required.”

Now compare this with Television over IP, or broadband video. Television over IP, on the other hand is the high quality streaming video, that is made available over the fast pipes, without a set-top box. This is a (comparatively) fairly low cost, and perhaps a simpler model. This simplicity is one of the reasons, it might actually gain traction in the market. While I am not willing to put a lot in the “long tail” video efforts like video blogs and efforts of start-ups such as Bright Cove, I do think there is a lot of hope for branded content online, especially if content owners can create a superior experience. I have seen some of the video-over-broadband efforts of folks like Comcast and News Corp., and that looks promising. Other content owners are also cooking up broadband channels.

Today launch of mtvU Über, a network that allows aspiring student broadband creators to create broadband content is a step in the right direction, but not the final answer. The bottom line is that, the television over broadband needs some sizzling new kind of content in order for folks to go back and click. My feeling is that MTV should have done their MTV Desi channel over broadband, and perhaps used it as a learning experience for other niche channels over broadband. If done right, television over broadband has the potential to pip IPTV to the post.

The impact of Bit Torrent, RSS, and Networked Video Recorders will be covered in the part 2 and 3 of this series, which will also look into Google TV, Yahoo’s media efforts and why really the networks should not be fearful of peer 2 peer networks.

28 Responses to “IPTV versus TV-over-IP”

  1. Which countries have successful / failed in IPTV

    Companies involved,

    Equipment manufacturers,
    Content providers

    Interactive TV
    Interactive gaming
    Video on Demand
    Broadcast messages
    Cable TV
    Broadband internet
    Project size
    Potential of IPTV in India
    Delhi and Mumbai Cable TV homes
    Delhi and Mumbai Broadband connectivity
    Rules and regulations
    Swot Analysis

  2. Interesting ideas thus far. I’m currently conducting an IPTV benchmark of the current deployments in the US (FiOS, Surewest, MStar(UTOPIA), Pioneer, etc etc) and would like to speak with anyone who is currently subscribed to an IPTV service. If you or anyone you know has experience with an IPTV service provided by any carrier can you please email me for a quick discussion?


    [email protected]

  3. IPTV_is_my_life


    Unfortunately, I do miss the point of the article. Technicalities aside, I am happy you collected the research links.

    I, as well, would not have known about these businesses and technologies if not for avid, borderline-obsessive, browsing of the IPTV News ( directory of IPTV-involved companies. The IPTV News directory may not be as extensive as John Dvorak’s IPTV site ( but the organization of the directory is superior, not to mention easier on the eyes.

    Broadband stations are viewable via IPTV set-top boxes made by Akimbo ( Elaborating on my original point, competition of the two technologies is non-existent because Broadband TV is accessible via IPTV thanks to Akimbo equipment.

  4. IPTv_is_my_life, i guess you did miss the clear point of the piece. IPTV aka Telco TV versus broadband video, the kind folks like MTV and Fox are trying to offer. Anyway i do take your point, and your comments, and research links. Thanks!

  5. IPTV_is_my_life

    TV-over-IP IS IPTV. Broadband video, which you refer to as TV-over-IP, is not the same as TV-over-IP (IPTV).

    When you talk about viewing television without a set-top box, you probably mean to say “narrowcasting.” Narrowcasting is not in competition with IPTV – simply because it supplements the technology rather than opposing it.

    Visiting Narrowstep’s ( website will provide further education on the concepts involved with narrowcasting.

    Unfortunately, you are also ignorant when it comes to potential players in IPTV. Cable and satellite operators (not just telcos) are now able to play along thanks to TVnet (Ethernet-over-coax technology) by Coaxsys ( TVnet transforms coax receptacles into a high performance multimedia network, creating new applications for digital communications and entertainment – without having to hardwire Cat 5 cable throughout the home.

    Coaxsys Inc.’s IPTV7000 ( adapter accomplishes this task and is extremely popular with both telcos and service providers.

    I’m hoping that people will taking the statements made in the article “IPTV versus TV-over-IP” with a grain of salt. This person has concepts confused and obviously did not heavily researched the topic of the article beforehand.



    I suggest you study the following NDS ( products and information regarding the Secure Video Processor to gain enlightenment about Content and Content Security:

    Synamedia (
    iVideoGuard (
    xVideoGuard (
    Secure Video Processor (

  6. Jesse Kopelman

    A computer running specialized software to receive DRM content and stream it throughout the home would be no less secure than the closed fiber path and there is no reason it has to be free (see iTunes et al). The advantage of the closed fiber path is greater control for the network operator, not the content provider (who would be better off going the route I just mentioned).

  7. I think the main problem with just sending content to computers in IP format is the content owners will not allow valuable content to be available to become shared content. Closed fiber networks and set top boxes using encryption are a little more secure.

    Any company could make their content available now….but they don’t as it’s hard to sell what people can get for free. Sending video in IP format on the internet will make it available free.

  8. IPTV is working in Hong Kong. With a population just under 7 million, 441,000 subs in two years is not too bad. What would that be in the US with a population nearly 300 million!

  9. The structures are fascinating — but, the reality is all of this is avail. to anyone interested today, with a basic broadband connection (including, technologies that allow instant-on streaming of playerless files; we’ve tested these, they work).

    But, it comes down to content…And, the promises of the Brightcoves, Akimbos, DaveTVs are only as good as their relationships with content providers will be. And, they are sucking up to the traditional providers, who don’t need them, and ignoring the independent (yet professional) producers/publishers. Seeking out alot of old library content that no one cares about is a sure route to failure.

    The search tools for video are more important than the hardware. Yahoo is well on its way to becoming “TV Guide.”

    More important, are the producers/publishers who shape their content for an on-line experience that is different from TV.

  10. The technology is here today. This is a content problem. Hopefully we see more and more investment in iterative cross-medium story and game production. Like tv produced *with* the web instead of for the web; tv produced *with* the audience instead of for (or by) the audience. This is all happening now and is pretty exciting. Things are just getting started.

  11. Verizon’s FiOS TV (already deployed in Keller, TX) is not IPTV. It is QAM over hybrid fiber coax. Only the VOD return path is IP. SBC is still struggling with trials of IPTV.

  12. I think we need to make it clear here that

    None of the Baby bells has the technology to deploy pure play IPTV today. The software that Verizon and SBC plan to use is from Microsoft and as I mentioned…”TRIALS” are being run.

    The currently deployment of Verizon TV bundled with FiOS Internet is NOT IPTV. FiOS is their Fiber Internet Service…

    SBC is using Microsoft’s CFS architecture to deploy MSTV (IPTV) , and Motorola also plans to use Microsoft’s IPTV s/w for their set-top boxes…

    I have seen all this work very well in trials…and all we need now is digital content+bandwidth and a few more dollars

  13. folks i agree with some of the issues you bring up, however, the point i am trying to make is that as a new generation of viewers that is growing up on broadband comes to understand the value of TV-over-IP, we cannot discount what happens. IPTV, as we know it is slow out of the gates, and has a chance of being upstaged. that’s all i am trying to say. ad splicing and all that stuff can still be done in the second more simpler model. the phone operators have yet to show us a real reason to switch from the cable system or the satellite system.

  14. Jesse Kopelman

    What people miss about IPTV and VOD in general is that it is more about the relationship between the carrier and content providers and advertizers than the relationship between the carrier and the customer. With VOD the carrier knows exactly who is watching what and when and how many times they are watching it. Since they are generally paying to carry the content and there is no shortage of content providers, that is a nice thing to know as precisely as possible. Now, mix in IP and you have the ability to splice in customized advertizing on the fly. That is a very valuable ability indeed, as Google has taught us.

  15. One of the rumors for the announcement that Apple will make tomorrow is in this area. I am hoping that Apple will announce an iFlix store where one can purchase/subscribe to video content that gets downloaded to a computer. Hopefully they also allow the content to be viewed from any other computer in the home network (via Bonjour). The content should be viewable on a monitor or TV attached to any of the computers.

    The Mac Mini would be a perfect set-top box since it is very quite.

    Another rumor suggests that Apple might announce a new Airport Express with video out. The rumor also says that there will be a remote control that can control the computer via the Airport Express. This would be great, again from a noise standpoint. You would not need a quite computer like the Mac Mini. You can have a noisier Mac (or a PC if they make this PC compatible like iTunes and the iPod) far away from you TV and then have the quite Airport Express in the room where you watch TV.

  16. It’s about time someone posted this clarification on semantics. I’ve seen more and more people blur the two definitions over the past months and have been starting to get irritated over it. The technologies, buyers, businesses, products, users, etc are most certainly different for each — at least today…. we’ll see how the world of broadcast content evolves over the next decade.

  17. Wes Felter

    I think broadband video will have a hard time catching on if you can’t watch it on your TV.

    BTW, a little-known fact: FIOS doesn’t use IPTV at all; it’s just QAM digital cable over fiber.

  18. Verizon has already deployed IPTV in trial over their FiOS service in Keller, TX using a motorola set-top box that also uses MSTV’s new IPTV software. The trial went really well…except most channels are analog and not digital and IPTV makes most sense when we need on-demand and where digital movie content is easily available.

    BTW, the coolest feautres that many a couch potato will appreaciate is no lag between flipping channels….no blank screen, no millisecond wait..just smooth cutover from one screen to the next..easier on the eyes…;)

  19. With all respect, this is not principally an issue of technology. Neither is it an issue of content. It is an issue about regulation.

    The present telecom regime dictates a rigid franchising procedure that was conceptualized in the 1970’s. This franchising scheme favors incumbent cable providers, many of which have actually paid off local communities to win their franchise agreements!

    The loser here is the consumer. We are forced into monopolized agreements with cable companies that artificially inflate costs to the consumers, block out competition and often times provide crappy service.

    This is about consumer choice. IPTV providers are for it. Big Cable is against it.


  20. Some important issues that have not been addressed –

    What happens to IP after it reaches the home? Is it networked in the house (probably not), or is it dropped to a single location? (not good)

    If no attempt has been made within the home to network the content, then it is left up to the homeowner – which is fine for the IT capable, but a nightmare for those who are not. Most often it is left to a wireless solution which defeats the entire purpose of delivering high-quality digital programming to the side of the house.

    The point is that the telcos are not doing enough to take care of the content after it reaches the home. In the end, if the infrastructure does not exist in the home to network the streams properly it doesn’t matter what form of delivery it comes in.

  21. …Om points out the slow and expensive roll out of IPTV; there’s fiber infrastructure to build out, there are high price-points for set-top boxes, and we’re all waiting for the MPEG-2 to MPEG-4 transition. All good points.

    In comparison, Om thinks television over broadband is a smarter approach. He just might be right. Let’s look at the stars aligning here…

  22. Herman Wagter

    Can Om explain the difference (in technical terminology) between IPTV and video over IP as he perceives it? The post does not give a clue. Other than using different protocols (TCP vs UDP, Mulitcast features) I am not aware of differences that matter.

  23. Quite interesting debate and new Acronym of Television over IP.

    Actually that’s the same problem as VoIP : TCP/IP Stack has created an Universal General Purpose Transmission that can link any computer to any other computer such as x86 has created a Universal General Purpose Computer.

    At the beginning of a new usage (Data Browsing, Phone, TV…) vertical, customised solution try to lock customers (Minitel, Vonage/Telcos ToIP, IPTV) but as the General Purpose improve performance, horizontal solution (Web, Skype, SIP…) gains momentum and bash Verticals.

    Intel has famously showed you can win (and big) in a commodity, perfomance-driven, general purpose market.
    The main debate today is the emergence of companies focusing on constantly, predictively, simply improving Raw Transmission Speed of Flat Fee Pervasive IP Service, particularly in Wireless.
    May only ONE deep pockets guy plays this focus well and Broadband networks could be changed forever !!!