IPTV operators are scrambling to deliver more HD programming, but there are big challenges ahead.
Richard Broughton, an analyst at Screen Digest, explained that HD gives IPTV providers a major competitive advantage despite having a limited number of channels. “If IPTV had an Achilles' heel, it would be HDTV,” said Broughton. “Satellite and cable TV [services] in Europe typically have larger numbers of HD channels, with premium content in HD. IPTV, by contrast, has very little — perhaps the basic Luxe.TV and National Geographic [Society] or Discovery [Communications LLC] HD channels. In the U.S., numbers are perhaps less polarized as a result of higher IPTV access speeds (compared to Europe). Consequently, the larger core-channel capacity of IPTV could prove to be a winner in [this] country, allowing operators to potentially offer more HD than their rivals; however, as with standard definition, it's the quality of content, not the quantity that matters.”
HD for Free
Broughton added that IPTV providers often use HD as a promotional vehicle rather than to generate revenue. “IPTV services offering HD typically provide it cheaply, [but this is not] without its reasons,” he said. “Satellite TV in Europe typically uses its premium content — sports and movies in particular — to drive uptake of HD packages. IPTV, on the other hand, does not typically have the premium HD content (nor is actually able in many cases to offer it), so it usually offers the HD content it does have on an FTA (free-to-air) basis. IPTV uses the HD as an ad for the platform rather than as a serious revenue generator of its own accord,” he said.Broughton explained some of the reasons for limited HD offerings, at least in Europe. “Fewer than 20 percent of European IPTV services offer HDTV, and many of those that do, like Orange TV or Freebox, rely on ADSL2+ to deliver the content. For content owners, this is a concern, as the HDTV may not be delivered at the quality they would like. Consequently, HD is on few IPTV services, even those using ADSL2+. For others, like Deutsche Telekom's Entertain service, only certain higher-speed customers — like the VDSL (very high-speed DSL) subscribers — can take HDTV. That said, most of the major IPTV operators (like Imagenio and Orange) offer HD, with others, like FASTWEB, supplying HD on demand. [British Telecommunications PLC] has yet to launch HD, but there is some speculation that it will attempt to push VOD (video on demand) HD service later this year.” Verizon also announced HD on demand in December, expecting to offer 1,000 titles in 2008.
Shortage of Set-Top Boxes
The shortage of HD set-top boxes is another potential setback for HD IPTV, but Broughton said he believes the blame falls on chip manufacturers rather than set-top manufacturers like Motorola. As he explained, “Currently, our money is on chipsets not being supplied to the manufacturers fast enough. It's unlikely to be the operators misforecasting demand or Motorola failing to keep to schedule — both are too experienced to make such a mistake. Instead, it's likely to be down to the chipset manufacturers being unable to keep up with the demand from box suppliers (a consequence of increased HD uptake from TV customers). HD uptake has in general been a little slower than expected, although certain IPTV providers have been pushing HD boxes out free, meaning that a great demand has been placed on suppliers and manufacturers. It isn't necessarily indicative of consumer demand; (it's) more operator optimism.”Despite continued growth, it may be awhile before HD exceeds standard-definition offerings. “HD is unlikely to become the norm for some time, but Screen Digest forecasts suggest that many households will pick it up quite readily. HD displays will be commonplace by 2012; however, costs and availability of content mean that in the U.S., for instance, roughly 50 percent of households will be enabled (in other words, have an HD set and take HD content) for HDTV,” Broughton said.
Whether IPTV will become a major driver of HD programming remains to be seen, but its high-capacity fiber networks certainly add promise. As prices on HDTV sets come down and consumers demand the content, today’s TV will eventually become a relic of the past.
Source: DailyIPTV
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