sofien72tu
Super VIP
- Messages
- 25,214
“IPTV is an inevitable part of most telco’s plans, if only to stay in business,” said Seachange’s Simon McGrath, CMO.
However, he warns IPTV operators not to take too much on at once. McGrath (pictured, left) said that for most telcos, like British Telecom, Deutsche Telekom and smaller players, they are entering the IPTV space to stay alive in the marketplace. “Shareholders want to see that the telcos are staying in business for tomorrow and that there’s a route towards continued profitability.”
“But there’s a growing move towards wholesaling [of programming],” said McGrath. “It helps operators find the economies of scale needed to make money. In the US the cable industry decided years ago to move towards wholesaling models as regards programming. One joint-venture supplier was ‘In Demand’ which supplies VOD and PPV movie programming, and the other was the National Cable Communications (NCC) that handles the placing of spot advertising across a huge number of cable companies. They recognised the need years ago for sensible aggregation. We’re doing the same. For example, in our j-v with the TeleMunchen Group we are acquiring programming rights and wholesaling ‘white label’ own-branded services for cable, ISPs and the rest.”
McGrath admits that no two markets need the same solutions. “The USA, for example is a hundred very different markets. Even within a player like Verizon it offers a couple of different services, while some smaller players are committed to DSL while others are going for wireless in the home. In Russia the telcos have inherited a most challenging telephony system that suffers from interference and does not lend itself to DSL. Instead they are running feeds into the apartment blocks then using Ethernet/CAT5 around the building. In Germany it is different again, where there’s a mess of cable but Tier 2 and Tier 3 players, and some significant ISPs. The IPTV challenge for each and every one of these players is how their chosen system might scale,” said McGrath.
There are obvious technical challenges. “It is all a question of choices, making the capital investment and making sure everything works, itself not always easy for some suppliers,” said McGrath, hinting at the significant problems suffered by some IPTV vendors. Then there is the next obvious obstacle which is finding the content – which is again where Seachange steps in thanks to its 100% ownership of On Demand Group, a well-established supplier and wholesaler of programming and channels.
McGrath admitted that some operators were anxious that they might be losing what they saw as control if they went the wholesale route, “but they quickly realise that it has huge advantages, in terms of choice available and costs. They focus on the retail end, we give them the very best of content, and with the accumulated skills of experience in other markets.”
Seachange has its roots in ad-insertion for the US cable industry (and now with a 99% market share) and using its technology in the VOD market. The past few years has seen it transition from simply selling servers to a company where the expertise lies in its software. It has just announced a contract with Telekom Austria to manage content for its AON video on demand service, for example. It is also understood to be in talks with important players like BT Vision for similar content deals. “We’ve been working hard at applications like advanced advertising, network PVR and ‘pause’ television, and return-path broadband interactive services.”
McGrath explained that the On Demand Group has its experience in much the same market, but approaching the problem from a top-down approach. They are already the VOD service managers for Virgin Media, “and we have more than 30 people in London looking after Virgin, talking to Hollywood, Bollywood and every other supplier.” They look after ingest, promos, the marketing campaign, everything.”
“On Demand looked at what consumers needed, and what operators should do to attract more customers, and raise ARPU. Seachange bought ODG two years ago, and what’s now happening is that ODG’s retail focus is cross-pollinating with Seachange’s skills and ending up with us providing an end-to-end solution, for example, for our German customer. Our service scales down as well as up, so small ISPs can tap into a full portfolio of products, whether it’s for 10,000 subs or 1m. The obvious advantage for smaller players is that we have access to the studios. Why should a small telco, probably with no programming acquisition skills, even start down this path when we can give them a best of breed service?”
Key to any operator’s scheme is their size of their audience. McGrath says for smaller operators there’s rarely a need to have more than two major studios on board at the start of roll-out. “Hit your milestones, achieve 50,000 subs and then you might need all four major studios. At these key points in the expansion plan then start adding extra services for subscribers, and not attempting to do too much from Day One.”
“Our advice to new and established IPTV players is to focus on your customers, and how you are going to get to their TV set. Let us take care of speciality programming,” says McGrath. “In Europe we are already in front of 2.5m or so German-speaking homes and another 3.5m UK homes. We have a number of deals in the pipeline, and we’re looking for quite aggressive growth this year. It’s a compelling proposition.”
However, he warns IPTV operators not to take too much on at once. McGrath (pictured, left) said that for most telcos, like British Telecom, Deutsche Telekom and smaller players, they are entering the IPTV space to stay alive in the marketplace. “Shareholders want to see that the telcos are staying in business for tomorrow and that there’s a route towards continued profitability.”
“But there’s a growing move towards wholesaling [of programming],” said McGrath. “It helps operators find the economies of scale needed to make money. In the US the cable industry decided years ago to move towards wholesaling models as regards programming. One joint-venture supplier was ‘In Demand’ which supplies VOD and PPV movie programming, and the other was the National Cable Communications (NCC) that handles the placing of spot advertising across a huge number of cable companies. They recognised the need years ago for sensible aggregation. We’re doing the same. For example, in our j-v with the TeleMunchen Group we are acquiring programming rights and wholesaling ‘white label’ own-branded services for cable, ISPs and the rest.”
McGrath admits that no two markets need the same solutions. “The USA, for example is a hundred very different markets. Even within a player like Verizon it offers a couple of different services, while some smaller players are committed to DSL while others are going for wireless in the home. In Russia the telcos have inherited a most challenging telephony system that suffers from interference and does not lend itself to DSL. Instead they are running feeds into the apartment blocks then using Ethernet/CAT5 around the building. In Germany it is different again, where there’s a mess of cable but Tier 2 and Tier 3 players, and some significant ISPs. The IPTV challenge for each and every one of these players is how their chosen system might scale,” said McGrath.
There are obvious technical challenges. “It is all a question of choices, making the capital investment and making sure everything works, itself not always easy for some suppliers,” said McGrath, hinting at the significant problems suffered by some IPTV vendors. Then there is the next obvious obstacle which is finding the content – which is again where Seachange steps in thanks to its 100% ownership of On Demand Group, a well-established supplier and wholesaler of programming and channels.
McGrath admitted that some operators were anxious that they might be losing what they saw as control if they went the wholesale route, “but they quickly realise that it has huge advantages, in terms of choice available and costs. They focus on the retail end, we give them the very best of content, and with the accumulated skills of experience in other markets.”
Seachange has its roots in ad-insertion for the US cable industry (and now with a 99% market share) and using its technology in the VOD market. The past few years has seen it transition from simply selling servers to a company where the expertise lies in its software. It has just announced a contract with Telekom Austria to manage content for its AON video on demand service, for example. It is also understood to be in talks with important players like BT Vision for similar content deals. “We’ve been working hard at applications like advanced advertising, network PVR and ‘pause’ television, and return-path broadband interactive services.”
McGrath explained that the On Demand Group has its experience in much the same market, but approaching the problem from a top-down approach. They are already the VOD service managers for Virgin Media, “and we have more than 30 people in London looking after Virgin, talking to Hollywood, Bollywood and every other supplier.” They look after ingest, promos, the marketing campaign, everything.”
“On Demand looked at what consumers needed, and what operators should do to attract more customers, and raise ARPU. Seachange bought ODG two years ago, and what’s now happening is that ODG’s retail focus is cross-pollinating with Seachange’s skills and ending up with us providing an end-to-end solution, for example, for our German customer. Our service scales down as well as up, so small ISPs can tap into a full portfolio of products, whether it’s for 10,000 subs or 1m. The obvious advantage for smaller players is that we have access to the studios. Why should a small telco, probably with no programming acquisition skills, even start down this path when we can give them a best of breed service?”
Key to any operator’s scheme is their size of their audience. McGrath says for smaller operators there’s rarely a need to have more than two major studios on board at the start of roll-out. “Hit your milestones, achieve 50,000 subs and then you might need all four major studios. At these key points in the expansion plan then start adding extra services for subscribers, and not attempting to do too much from Day One.”
“Our advice to new and established IPTV players is to focus on your customers, and how you are going to get to their TV set. Let us take care of speciality programming,” says McGrath. “In Europe we are already in front of 2.5m or so German-speaking homes and another 3.5m UK homes. We have a number of deals in the pipeline, and we’re looking for quite aggressive growth this year. It’s a compelling proposition.”