BT Vision, telco TV blurred by challenges

BT Vision, the U.K. telco giant's IPTV venture, has fought perceptions about low subscriber adoption and regulatory challenges, as well as being part of an organization that is trying to recover from a spate of broader market difficulties and management changes. As recently as January of this year, BT Vision chief Dan Marks, a former Hollywood type, dramatically defended the IPTV service at a time when Italian operator Tiscali--a would-be U.K.. competitor--acknowledged that a lack of IPTV success in its home region of Italy forced it to shut down its efforts in that market.

But, Marks apparently had all he could take of BT Vision's uphill battle. He announced last week he was leaving BT after a five-year tenure there. The U.K.'s Telegraph reported that the departure may have a lot to do with frustration over the lack of progress in getting regulator Ofcom to enable fair access to wildly popular live football (soccer to some of us) programming, a content arena dominated by leading TV player BSkyB. Though, it also should be noted that the company's Project Canvas Internet TV joint venture with BBC and iTV also has been slowed by regulatory reviews and challenges. In addition to, and partly because of all this, BT Vision reportedly only has about 500,000 subscribers, which might not look bad to many operators, but is well off of the company's ambitions.

Meanwhile, there's also tension on the online video front, as BT has begun throttling online video traffic and particularly BBC iPlayer traffic. While traffic-throttling is nothing new in this age, BT reportedly is doing it for competitive and cost reasons, and wants BBC and other Internet video providers to start paying for the broadband ride they get on BT's network. This issue is far from a U.K.-only controversy. U.S. telcos recently have started to get more vocal about have the online video giants pay their way and even potentially contribute to the Universal Service Fund.

BT's issues are giving us a close-up on how far telco TV has to go despite ongoing growth, and how far telco TV and video content industry relations still have to go as well. On the some fronts, the telco TV types have been aiming to show the content players that they are worthy partners, but it's becoming clear that they also remain sensitive to letting the content giants gain too much from those relationships.

-Dan

For more:
- The Telegraph has this Marks report
- BusinessWeek has more on the BT-BBC spat

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Dan Marks defended BT Vision's progress earlier this year
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