When Echostar, operator of the U.S.-based satellite TV service Dish Network, announced last October that it would be launching ViP-TV, its own version of an IPTV (Internet Protocol Television) platform, the company was entering a nascent, yet already crowded IPTV market. ViP-TV will have to compete against incumbent IPTV platforms such as IP Prime from New Jersey-based satellite operator SES-Americom, Virginia's Avail Media, assorted smaller players and new services from large telephone companies like Verizon's FiOS and AT&T's U-verse.
A brief explanation of IPTV platforms helps to bring it all into focus. An IPTV platform essentially allows for the distribution of TV channels and video content (like VoD) for home TV viewing over a network designed for the Internet. Briefly stated, the plan envisions that telephone companies, Wi-Fi and WiMax operators or other public utilities like electrical cooperatives located throughout the U.S. will respond to cable TV companies' triple play suites (high-speed Internet access, cable TV, phone) by offering TV services to their customers.
The primary selling points of the IPTV platforms are the promise of distributing video signals in a more efficient manner in terms of bandwidth consumed. This makes an IPTV platform a lower-cost option for programmers and rights holders distributing both standard and high-definition channels and for service providers in terms of up-front head-end equipment costs (the head-end being the service providers' central equipment center where all of the equipment is housed). In effect, the service providers using IPTV platforms as their source for content can operate like a cable company and are called "cable bypass."
All of the IPTV platforms are pinning their hopes on the nascent IPTV technology to provide their potential customers (such as ethnic channels and VoD operators) with the ability to compete against traditional delivery and distribution platforms like cable and TV satellite services. The primary focus of the IPTV equipment suppliers will be signing up smaller telephone companies (telcos). But it isn't just small telcos that are the appropriate and targeted customers for IPTV technology. Private cable operators, municipalities, master-planned communities, multiple-dwelling units (or MDUs), public utility districts, cooperatives and hotels are all potential clients due to the technical advantages of IPTV with its "pull" model (or one channel at a time), versus a push...