Second-quarter earnings reports for the two largest U.S. telcos provided ample evidence that Verizon Communications and AT&T are not skating through brutal general economic conditions unscathed. However, TV services continue to be a source of strength and growth in their new core business-broadband. While they continue to see landline voice losses, TV subscriber numbers continue to grow in a reliable, consistent fashion. For companies whose entry into the TV market was greeted with great skepticism and concern about new infrastructure investment, there can be no better set of numbers to wave at both investors and critics.
It is success that largely has been accomplished with what are best described as cable TV-like video offerings. That may make it all the more impressive. Now, as Verizon showed earlier this month with news about its new TV widgets and Internet video relationships, telcos may be ready to up the ante with more advanced IPTV offerings. In the coming months, it will be left up to cable TV companies to match these offerings unless they want to keep losing TV customers to the big telcos. An online effort like TV Everywhere will help get the ball rolling, but the competitive pressure might also indicate that it is finally time for IPTV-over-cable efforts to take center stage.
Vendors such as Motorola and BigBand, which announced a flexible video control plane this week, are among the companies that have been poised to work with the cable TV operators to make that transition happen. Meanwhile, according to Multichannel News, a new venture capital firm, Genovation Capital, recently expressed an interest in investing in IPTV over cable technologies at all architectural levels, from the IP cloud to the IP set-top box.
Cable TV companies have started to make some initial moves, not only progressing with DOCSIS 3.0, but also reclaiming spectrum that they might re-deploy to support video-on-demand offerings. Floyd Wagoner, director of marketing and communication at Motorola Access Networks, told FierceIPTV, "The cable TV companies are doing reclamation today. You might see some linear broadcast come over DOCSIS as they look to get some bandwidth back, though you won't see a shift to all-IP immediately. IPTV for cable is definitely in the cards, but they are not practically deploying it to a large degree yet."
The gradual reconfiguring of the cable TV network model could be the thing that truly tests the now-consistent quarterly telco TV subscriber gains. It will be up to telcos to fortify themselves with new services and new TV capabilities to keep IPTV-over-cable efforts from taking back their hard-fought gains.
- Multichannel News has this report on Genovation
Comcast announced a major spectrum reclamation project
DOCSIS 3.0 has pushed the IPTV-over-cable concept to the forefront