IPTV not getting the attention it deserves from service providers

Jim Barthold, FierceIPTVFirst quarter earnings results are pouring in--CenturyLink (NYSE: CTL) is on tap tomorrow--and it's again apparent that IPTV as a service, application or just part of an overall broadband bundle is a winner.

Don't believe me? Check the results from AT&T (NYSE: T), the nation's largest IPTV provider. Or go to Canada where Bell Aliant has come up big again by using its fiber networks to deliver television over IP. Or maybe travel to Hawaii, where Hawaiian Telcom (Nasdaq: HCOM) noted its IPTV success. And, of course, there are the international markets where IPTV and success are listed as synonyms in the local dictionaries.

It's obvious that IPTV is a leading element in a broadband play. That's different than being an application on a broadband pipe, as so many in the over-the-top world would have it. It means that people buy broadband but they also buy TV--or in this case, IPTV--from their broadband providers because they want entertainment.

Personally, I think it's taken the service providers a little too long to understand this. Perhaps because many are telcos that have grown with voice and data services they fail to recognize the value of putting forth a competitive entertainment package to draw people to their services. Perhaps the bigger carriers like AT&T and Verizon (NYSE: VZ) have become far too enamored with their 4G LTE services, way too in love with the latest iPhone or Samsung device, looking at wireless tablets rather than wirelessly enabling TVs.

Despite what most think, I am not a troglodyte. I have a tablet, a smartphone and a TV subscription. I have TV Everywhere and HBO Go. I can, in other words, access my TV entertainment wirelessly wherever I go. I prefer to access it via my TV and a traditional connection. While I am often a loner when it comes to my tastes and desires, I don't think I'm alone here.

Last week I attended Perspectives13, GENBAND's state-of-the-industry conference where a variety of speakers talked about the future of the networks that will deliver all kinds of services, including IPTV.

Verizon CTO Tony Melone keynoted with an address where he listed four "platforms" around which Verizon will build its future business. LTE came in first; a global IP backbone to deliver broadband services came in second; FiOS, the carrier's broadband and TV platform came in third; and data center and cloud infrastructure came in fourth.

I think the priorities are skewed. Putting FiOS in third place is like not putting FiOS into a fiber-ready neighborhood--it makes no sense. And yet, in both instances, that's what Verizon is choosing to do: concentrate on LTE and leave the TV business for someone else.

Chuck Kalamek, vice president of research for AT&T Labs, came a little closer to hitting the mark of what IPTV can mean to a service provider when, during his keynote, he said that AT&T's goal is to develop a "connected life" for consumers that will put it into "the customer intimacy business."

He stopped short, though, of suggesting that this intimacy could begin with the shared TV experience.

Perhaps the most passionate of the telco keynoters was Matt Beal, CTO of CenturyLink, who, without ever uttering the term IPTV, suggested that the telephone business is in serious danger of obsolescence if it continues to produce a product Alexander Graham Bell would recognize.

His message was simple: Consumers, much as they love their cellphones, aren't listeners.

"We are a visual species," he said.

And yet, despite positive earnings results and subscriber numbers to back them up, IPTV is still playing second fiddle to other telecom services. That attitude, built over years of voice and data provisioning could come back to bite telcos who will be competing with cable operators who understand their bread is buttered with TV and are transforming that TV experience into something more with their broadband networks.

The situation, as Beal sees it, is simple.

"Our customers are voting with their feet and they are going to go to that company that provides this transformative experience," Beal warned.

Without a further emphasis on IPTV, that company may not be a telco.--Jim

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