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The Future of Pay TV Services v1.0

Table of Contents

  1. Summary
  2. Introduction
  3. A Changing Context
    1. Hyper Connectivity
    2. The Ultraband Future
    3. Real-time Interaction
    4. Network-aware applications
    5. It’s not the technology, it’s the experience
  4. Technology
    1. Internet-based video delivery frameworks
    2. Standardized IPTV and converged service delivery frameworks
    3. IPTV, Pay TV and broadband video trends
  5. Industry Economics and Business Models
    1. Pay TV and broadband video market status
    2. Pay TV operator economics
  6. Video services competitive analysis
    1. Video competitor market situation
    2. Video competitor feature advantages
    3. Comparing interactivity among video providers
  7. Recommendations
    1. For broadband operators
    2. For IPTV platform providers
    3. For investors


Breakthroughs in digital media technologies have converted media consumers from spectators into participants. This transformation has impacted all aspects of the media value chain, from content creation through delivery to the consumer experience itself. The interactive nature of the broadband Internet has set high consumer expectations for other media outlets, particularly video services, and for all manner of personal communications.

Figure 1: Market lifecycles for pay TV and broadband video


Source: © tvstrategies

These trends have resulted in significant changes to the pay-TV landscape.  As illustrated in Figure 1, older technologies such as cable TV are facing off against newer entrants such as telcos providing IPTV services, and cable, IPTV and satellite providers are all trying to figure out how to deal with Internet video operators who can go direct to consumer without investing and maintaining their own delivery network.

Established carriers have been battling a tide of defections by consumers, who are abandoning their core telephony and broadband-access services in favor of like services from cable TV companies and VoIP providers such as Vonage and Skype.  Both as a defensive measure and as a way to recover lost voice and data revenues, telcos have launched, with varying but increasing degrees of success, pay TV and movies-on-demand services over IP. Now that they have fully internalized the challenge, they appear poised to push past their cable competitors, both in terms of service innovation and rate of subscriber uptake.

This report examines the impacts of the growth of IPTV on satellite and cable providers, and how all of providers will react to the growing threat (and opportunity) of broadband video.

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