IPTV operators and other TV service providers don't want to be known only for delivering TV content to TV appliances. Perhaps it will be a while before we figure out a way of describing these companies and their missions that doesn't rely on using the word "TV" four times in one sentence, but you get the picture (pun intended), right?
Many of these service providers are already pursuing three-screen strategies, and some of them--notably Verizon Communications--are testing ideas for how to integrate TV and online video content in the same service package. They don't want to lose customer eyeballs or subscription fees to the Internet any more than they want to lose them to other network operators.
However, pursuing these parallel tracks means opening a Pandora's Box of network management and service delivery challenges. Those challenges include the fact that three-screen strategies are actually about far more than three screens. The permutations of TV models, PC models and mobile device models that service providers need to support is endless.
Also, a number of different video formats continue to co-exist between the online video, cable TV, IPTV and consumer electronics worlds. Some of these formats include: MPEG 2, MPEG-4, H.264, H.263, WMV, Flash and AVI, among others. Further complicating matters is the co-existence of standard-definition and high-definition video.
Video transcoding provides the unseen bridge between all of these devices and worlds. It allows an IPTV service provider, broadcaster or other firm to alter content from one video format to another, change the resolution to fit on different types and sizes of screens, or change the compression rate. Transcoding is especially important now as the TV environment supports both MPEG-2 and MPEG-4 video compression. For example, MPEG-4 content needs to be transcoded to run on the many MPEG-2 set-top boxes still on the market.
In addition to enabling the best possible user experience, transcoding also helps network operators be more efficient with their bandwidth resources. Some transcoding technology providers are focused on the IPTV head-end, but the function often occurs in a set-top box or similar device. There are several vendors involved in different aspects of the transcoding market.