Satellite
Satellite DTH operators
and the best strategies
for taking advantage
of IPTV
DTH satellite operators are currently
facing one of their biggest challenges
to date: How best to offer IPTV? With
stiff competition emerging from cable
and telco operators it really is sink
or swim time for the satellite market.
Dave Adams finds out the best
strategies for DTH satellite IPTV.
s broadband use
continues to multiply in
markets around the
globe, more consumers get to grips
with downloading different types
of media from the internet, and
IPTV begins to move towards the
mainstream, DTH satellite operators
find themselves in an increasingly
difficult position. Bereft of true ondemand capabilities, and beset by
fierce competition in the form of
triple and quadruple play offerings
from cable and telco competitors,
they need to find an effective way
to offer IPTV, true VOD, and
interactive services, including
personalisation and other
communications applications.
If they fail, they face an uncertain
future, as rivals able to take full
advantage of IPTV and long-tail
VOD are likely to take ever-larger
bites out of their subscriber bases
and revenues.
For some operators, the only
practical starting point in the shortterm is to focus on some form of
push-VOD service, with consumers
offered the ability to download pay
per view content to their STB hard
drives. “The limitation of that
solution is that it's expensive, you
need PVR capabilities everywhere
A
page twenty six
on the system, and the library of
assets to which you have access
is limited,” says Shahar Bar,
manager, broadcasting and satellite
solutions marketing at Harmonic.
“You can also usually only buy
those movies in SD format.”
In the longer term, in most
markets, such offerings will start
to look painfully limited alongside
other, more flexible IPTV or
broadband-based download
services available elsewhere.
Instead, many satellite operators
are now looking to develop some
form of hybrid offering, with a
broadband connection on the STB
enabling subscribers to access
to a wider selection of content,
including replay TV services, that
they can ‘pull’ out from the centre
through an Ethernet or USB port,
and IPTV services; alongside the
operator’s ‘normal’ channels, still
accessed via a satellite receiver.
With so many cable and telco
companies keen to offer triple
play services it makes sense for
satellite operators to try and give
itself the flexibility to be able
to offer such services.
Some operators are in a position
where they can afford to buy an ISP
to access its networks. Others are
www.cable-satellite.com
Cable & Satellite International
nov-dec 2006
Satellite
having to look at alternative ways of
accessing broadband connectivity. Differing
market and regulatory conditions are
shaping the strategies employed by
operators around the world, but essentially
each is faced with the same basic decision.
Do they buy or build their own DSL network
space (a practical, if not always costeffective solution option in parts of Europe,
for example, where local loop unbundling is
well-established), or lease bandwidth from
an existing provider — who must be able to
offer good QoS if they want to offer
consumers full on-demand capabilities?
In the longer term wireless broadband
may offer an alternative network for delivery,
or operators may invest in dual uplink via
satellite, but market conditions rule this out
for the short and medium term in many, if
not most cases.
“There are lots of questions to answer,
strategically, for the DTH operators,” says
Pascal Portelli, head of systems business
development and strategy at Thomson.
“It depends how strong they are competitively, and on the local regulatory landscape. Obviously, where cable is strong, the
incentive to move forward is greater than
in countries where cable is weak. And in
countries where you have lots of ISPs and
local loop unbundling there is also more
of an incentive.”
In many markets it makes a lot of sense
for satellite operators and telcos to work
page twenty eight
together. “Telcos are not very content-rich,
so they are the natural allies of the satellite
operators,” explains Venkat Krishnan,
director of IPTV solutions at digital video
specialist SeaChange. “This is really the only
way that the telco can bundle pay TV into
their offerings.”
That doesn’t work in every market,
because in some countries, like Spain
or Italy, the telcos are in a strong enough
position already that there is less incentive
for them to partner with satellite operators.
But for those coming to the conclusion
that a technically impressive broadbanddelivered, IP-enabled service is still
vulnerable without the best content offering,
this model makes a lot of sense.
“To survive, telcos have to offer a high
value content proposition” says Krishnan.
“They have the advanced interactivity and
personalisation services that IPTV can
offer, and in return they get to receive
the content value proposition from the
satellite operator.”
Various operators in different markets are
expected to make announcements on
partnerships run along these lines over the
next 18 months. Not all partnerships are
the same, of course. BSkyB has set its own
agenda in a characteristically aggressive
manner, with its purchase of EasyNet. It
plans to introduce IPTV sometime after
www.cable-satellite.com
“There are lots
of questions
to answer
strategically,
for DTH satellite
operators” Portelli
2007, and the next generation of BSkyB
STBs (including the HD-capable boxes
already being deployed) will carry an
Ethernet port.
Whichever route a satellite operator takes
to develop a hybrid offering, to take full
advantage of IPTV there will have to be
changes in middleware, and in the STB.
But because whichever way an operator
chooses to achieve it, the hybrid approach
is effectively an expensive gamble, it’s
important to try to minimise the cost of this
change. Whatever technical alterations may
be required, there will be a widespread
tendency to try and avoid making any huge
changes in the way services are managed.
Technology vendors like SeaChange hope
this will both help them to hold on to
existing clients, and to develop offerings
that don’t have to be restricted to serving
a particular niche. While many have been
putting lots of effort into developing IPTV
solutions that address the needs of cable
and telco companies, the growth of hybrid
arrangements offers them new
opportunities.
This year, SeaChange has repositioned
itself to compete with IPTV middleware
Cable & Satellite International
nov-dec 2006
Satellite
“You can’t just ignore the fact that
people have now got home networks
and want to share content on other
devices. Almost every operator will
give you a broadband router” Beavon
providers like Microsoft. Its new TV Platform
is an end to end IPTV solution, consisting
of modules for STB, network and back
office software for the delivery of ondemand content, including games,
interactivity services, and converged
communications applications like called ID
on TV, DVR programming via mobile phone
or internet command and videoconferencing. The Platform's Navigator Four
middleware solution is suitable for satellite,
cable, Telco, terrestrial and hybrid operators.
At the same time, NDS has launched
Synamedia Metro, designed to serve the
hybrid market, while OpenTV's Core 2.0
platform can support the same STBs
for both satellite-only customers and
satellite/broadband customers.
There are opportunities and challenges
ahead for STB manufacturers. In the longer
term, many operators will be forced to
address the issue of legacy STBs, because
even those which already have Ethernet
connectivity already will soon fall behind
in terms of memory and processing
capabilities, and STBs required to process
streams coming from different networks
(and likely to have to do so simultaneously),
will need to be highly robust. “People like
us will need to evolve the way we design
our STBs, because the original DTH solution
was not designed with IPTV in mind,”
agrees Thomson’s Pascal Portelli. “We have
a good grasp of what needs to be done,
and have already started doing it for some
of the front runners.”
The broadband boom may well help
those operators that decide to concentrate
on download services rather than IPTVbut it will also help blur the distinctions
between internet-enabled services.
And more broadband will help boost the
spread of home networking, and of services
that enable content-sharing between
devices. “You can have an offering using
non-guaranteed-QoS broadband, with a
combination of peer to peer networking
and DRM,” says Jonathan Beavon, director
of marketing, broadcast internet group at
NDS. “So you can allow the satellite
operator not to invest in the network, but
to offer a larger catalogue of content, and
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you can allow that to be shared through
a peer to peer network with DRM.
For a broadband operator or a satellite
operator it means they don't have to spend
too much getting broadband into the home,
and they don’t have to invest immediately
in the big infrastructure. That's a solution
for those people who realise they can't
do a service based on guaranteed
bandwidth and guaranteed QoS.”
DTH satellite operators will have to
support content sharing between devices,
Beavon suggests, because other operators
certainly will. “People will take things into
their own hands and either do it illegally
or get it from another operator,” he says.
“You can't just ignore the fact that people
have now got home networks and want
to share content on other devices. Almost
every operator will give you a broadband
modem router or a home gateway, so you
can't just try to insist that the content stays
at the end point.”
That means that IPTV and broadbandbased download services will end up
straddling the divide between current
business models for television, and the
download-based world encroaching on the
mainstream broadcast and entertainment
industry, represented not just by IPTV, but
by the Internet video download services
now appearing in various different forms
online. One of these companies, Akimbo,
is already acting as a VOD contentproviding partner for US Telco AT&T in its
Homezone broadband/broadcast TV/VOD
service, which fills in the service provision
in areas beyond the reach of AT&T's own
network, over which it runs its own TV and
VOD services. Broadcast TV in Homezone
is provided by Echostar.
It seems likely that other cable and telco
operators will develop similar services, with
content drawn from wherever is practically
and commercially suitable to offer
consumers a seamless experience, over
the next few years. “You've got two worlds:
content that can be downloaded, and
content available with subscriptions and
defined networks,” says Beavon. “People
with a defined service are having to look
at what's happening on the open internet,
to keep a lookout for a good way into the
download market. Those two worlds will
slowly come together.”
The final pillar still supporting the current,
inflexible model is the pattern of content
ownership, and the attitudes of content
owners, but even that is no longer so
solid as was once the case. There are still
challenges to overcome, such as those
related to the sharing of content containing
pop music, for example, but, says Beavon:
“the explosion in broadband use means it’s
a viable channel, and there’s a business
there, so many content owners are ready
to enter into that, they can see the
commercial reward and they're prepared
to experiment. I think that’s quite a change.
Even a year ago that wouldn’t have been
the case, but now they can see that there's
money to be made here.”
In some ways, on a purely technical level,
DTH satellite operators may feel that the
odds are stacked against them. But while
cable and telco may boast some natural
advantages when it comes to the provision
of IPTV and true VOD, it’s important not
to lose sight of the fact that even in a
rapidly changing industry being able
to provide the best quality content and
service is still all-important.
“Some IPTV projects will work, and some
won't,” says Jonathan Beavon. “Even if they
technically work they won't necessarily
succeed [commercially]. So you may have
a telco with a service that has solved all the
technical problems, but that still may not
succeed, because it may not be compelling
for the consumer in comparison to what
some of the other broadcasters are offering.
I think the ideal end product is probably
different to what some of the telcos think
it is, and so their investment to try and
replicate what already exists may not be
the best use of their money.
They must beware spending millions on
building an infrastructure only to find out
that it's not really what the customer wants.
They should be going for some kind of
combination with the download model
— and that’s where the opportunity lies for
satellite.” Perhaps the most important thing
that most DTH satellite operators have going
for them is that they are not new entrants to
the market. They have the content, they have
the wherewithal to deliver excellent PPV and
HD services, and provided they keep their
eye on the ball, there's no reason why the
rise of IPTV should be any more of a threat
than it is an opportunity.
Cable & Satellite International nov-dec 2006