In what will surely be seen as a surprising development, SES Americom has announced that it will shut down its IP-Prime transport and programming service supporting small U.S. telcos rolling out IPTV services. IP-Prime will end by July 31, 2009.
The company cited "slow adoption" of IPTV by small and medium telcos in North America, as well as the "difficult market outlook" for the service, according to IPTV news and a company press release. That negative outlook comes just days after an SES executive, speaking at an investor conference, painted the company's outlook as fairly positive, in part because it had many service providers locked into long-term contracts, and also because TV services have been broadly viewed as recession-proof.
The company said it has IPTV signal delivery agreements with 70 small telcos so far, and about 37 of them have conducted commercial roll-outs, but Rob Bednarek, President and CEO of SES Americom-New Skies, states that "with a subscriber base of less than ten thousand at the end of November and after more than 2 years of service, the consumer uptake is insufficient to justify continuing operations."
Continuing until July 31, SES Americom said, will allow telco customers to transfer their services elsewhere. Presumably there also is a chance the IP-Prime program could be sold to another party, though SES Americom did not specifically say this in its press release.
In addition to the positive comments last week, it was only last month that SES Americom touted its list of customer agreements at the TelcoTV 2008 conference. However, another trend increasingly apparent during and since TelcoTV is the possibility that more small telcos will skip IPTV launches to focus on leveraging their broadband networks with content download partners like Vudu and others.
- IPTV News has this post
IP-Prime was looking pretty healthy at TelcoTV 2008
SES Americom touted its long-term contracts last week
IP-Prime launched with much fanfare in September 2007