In the words of an industry insider, the spelling of 'telephone' for companies here in the future should be 'television'. This indicates a trend: future telephone companies are transitioning towards television. So, what is the actual development of IPTV?
IPTV has become a fashionable term nowadays, at least in the telecommunications industry, it has become a word that is almost used every day and is increasingly being discussed by people. At the Telecom NEXT conference held in the United States in late March, most of the presentation was about how phone companies deliver video programs. In the words of an industry insider, the spelling of 'telephone' for companies here in the future should be 'television'. This indicates a trend: future telephone companies are transitioning towards television. So, what is the actual development of IPTV?
Firstly, consumers do not know what IPTV is.
A recent survey shows that nearly half of American and European consumers do not know what IPTV is. According to a survey of 6000 users in the United States and Europe (including Spain, the United Kingdom, Italy, France, and Germany) conducted by Accenture, a leading management consulting firm, 46% of users are unclear about what these letters IPTV refer to. In Italy, even 4% of respondents believe that IPTV is a new television competition program.
People in the telecommunications industry are enthusiastic about using technical terminology in their marketing, but the survey results above indicate that this approach is not suitable for IPTV. What telecom companies should do is focus on selling the concept of IPTV: it can enhance the experience of ordinary viewers watching TV, and it is expected to provide more advanced interactive services in the future, which requires a process of market cultivation.
Secondly, there is no mature charging model yet.
Price is a major obstacle to IPTV. In the survey conducted by Accenture, 54% of respondents stated that they are unwilling to pay additional fees for an entertainment service that allows them to search for TV, radio, and music programs at any time.
The IPTV revenue and expenditure model is based on many assumptions, but these assumptions assume a well known and stable market, while at the same time, the core definition of IPTV is in flux.
The behavior and traffic patterns of users will guide the development of the industry. The most important part is to distinguish between online traffic and offline traffic. The biggest concern of network owners is that they only provide a network that others can use for free without receiving any benefits from traffic. So, they must distinguish between online services and offline services. Layered services will protect the interests of both network owners and users.
Once again, telephone companies still face legal obstacles in terms of television services.
In the United States, wired services need to be provided under the policy supervision of county and city governments. For telephone companies, negotiating with the government at the local level is time-consuming. Verizon once mentioned that even if it receives a local license one day, it still takes several years to provide video services to all its users.
The new laws in Texas and Indiana allow telephone companies to obtain licenses from the state government without the need for local authorization, thus greatly simplifying the already lengthy process. Virginia has passed a similar law, but it has not yet taken effect. Currently, IPTV is actually guided by smaller companies, many of which serve rural areas. In addition to obtaining some concessions, their systems are smaller, making it easier for them to adopt new technologies. For large telephone companies, the franchise war is harsh, as they have to deal with thousands of local governments.
Finally, the biggest challenge is that the entire IPTV industry may underestimate what it should do to deliver services, as user experience rather than technology is the most critical factor for IPTV. Although IPTV has some technical advantages, it remains to be proven whether these advantages can win and retain users. Meanwhile, some analysts believe that IPTV does not really need a technological advantage to compete with cable companies. For consumers, convenience is a temptation. Being able to obtain wired telephone services, wireless telephone services, broadband internet services, and television services from a company, also known as "quadruple playback," has great appeal to consumers. The survey shows that users have a clear interest in the types of services that IPTV can provide. For example, in the United States, 37% of respondents choose to be able to watch programs anytime when it comes to how to better watch TV. Moreover, 30% of respondents in Europe stated that they need more movie channels, which IPTV can provide technically.
However, from the above content, it can also be seen that many IPTV implementations are involved in old paradigms such as telephone services, television, video on demand, and so on. After all, IPTV is only an improvement, not a true innovation. When the market changes and remains stuck in the old paradigm, perhaps one day, operators will have to significantly lower prices to retain users. Therefore, in order to win in long-term competition, telephone companies should make certain changes in direction and develop more other service content. Moreover, it should be a revolutionary business with true innovation and an order of magnitude of improvement. And this is something that IPTV operators have not truly solved.