| Switched on? |
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| Wednesday, 21 November 2007 | |
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Forty million IPTV households worldwide by 2010…
New forecasts from analyst firm Canalys suggest the IPTV market will see rapid growth over the next three years, driven by telecom operators’ desire to boost average revenue per user (ARPU) and counter the growing threat from competing triple-play providers. Worldwide IPTV subscriber levels will increase more than tenfold by the end of the decade, growing from fewer than 4mn in 2006 to almost 40mn in 2010. EMEA accounted for two-thirds of global IPTV subscribers at the end of 2006, and will remain the largest market through to 2010, when the region will account for 38% of the worldwide total. “ But the favourable market conditions that have helped IPTV thrive in With Verizon growing rapidly and AT&T moving beyond the infrastructure development phase, Canalys expects to see strong IPTV subscriber growth in “IPTV can be viewed primarily as a defensive strategic move by service providers at present. While telcos have aspirations of creating new, profitable revenue streams, the key short-term driver of market development is improving customer loyalty and reducing churn levels,” Fitzpatrick concludes. “IPTV will be a financial loss leader for many providers over the next five years when the costs involved with rolling out and evolving services are factored in, but if telecom operators are to retain their position as primary providers of consumer communication services, this may be a price they need to pay. It is difficult to see how the majority of IPTV providers will be able to generate significant profit from services in the near term, especially when the need to be price competitive is considered.” And more observations on the telco IPTV market from PricewaterhouseCoopers LLP, publisher of the new analysis ‘Show me the money: Strategies for success in IPTV’. “IPTV is the hotbed for true convergence – showing the money from IPTV will require telcos to transform, both culturally and as an organisation, into areas that until now were occupied by media companies. Content acquisition and advertising sales will need to become core competencies for every telco launching IPTV.” (David Lancefield, TMT partner). “The overriding shift that these companies need to make is now all about customer service, consumer experience and developing trust in the brand, since one second of blank screen maybe enough to turn the customer off the service for good. To capture market share, traditional technology-led strategies must be relegated in favour of market-led approaches. Engaging with consumers in a single, holistic way is paramount – the right content for the right person, in the right place, at the right time.” (Colin Light, TMT director). John Williamson |
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