Good Days Ahead for IPTV ... Probably

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This Parks Associates press release suggests that IPTV has a bright future. It estimates that by the end of 2011, almost 60 million people will be using the Internet to watch television.


In the U.S., the report predicts, gains for the Tier 1 telephone companies "will reach solid numbers by the end of the forecast period." The firm says that North American providers will have to be proactive to get a foothold, however. Clearly Verizon, AT&T and some smaller carriers got that message long before the study was conducted.


We think that the Parks' assessment make sense, as far as it goes. The challenge, which is tacitly acknowledged in the release, is that IPTV is one element of a much broader and confused arena. Nobody knows precisely how this very fluid landscape, which features several industry sectors (cable, wireless, cellular and wired telco) and four different services (video, wired and wireless voice and data) will coalesce.


The release is not illuminating when it comes to North American IPTV. To suggest that IPTV will produce "solid" numbers for telcos down the road is safe enough. What would really be an interesting prognostication is whether telco TV will be enough -- along with telco VoIP, legacy voice services, cellular holdings and DSL and fiber-based data offerings -- to maintain the dominance that even now is eroding. Perhaps it's in the full report. Or perhaps Parks acknowledges that such questions are impossible to answer.


Frost & Sullivan also released an IPTV report this week. The firm says that the platform generated $423 million in revenue last year and will reach $12 billion in 2007. The drivers will include the ability to time-shift programming, facilitate VCR-like functionality and choose from on-demand content. Much of the groundwork apparently isn't done, the report says: Telcos must upgrade their networks, win television franchises and siphon off customers from cable or satellite services.


Finally, a survey from Accenture and the Economist Intelligence Unit seemed more tempered in its enthusiasm. The companies queried almost 350 executives worldwide on the prospects for IPTV. Sixty percent said that significant revenues are likely within three years, but 52 percent were not confident of the ability to generate "significant" revenues from the 12 months after being queried. Thirty-three percent of the respondents were based in the Americas.


The takeaway is that folks who write reports and conduct surveys don't know what is going to happen. What is certain is that IPTV will be a central focus of the give-and-take between various industry segments for a long time into the future.