IPTV

Consumers Demand Quality Voice and Video

Brix Networks — Wed, 20 Feb 2008 16:11:41 GMT

I ran across Robin Gareiss’ article on bandwidth demands soaring in Network World today and thought I would discuss the consumer side of the problem as well.

She mentions that:

“[Network World] asked IT executives about bandwidth growth to the branch, and 98% of them said they had increased bandwidth in 2007 - on average by 80%. And for 2008, 90% expect to increase bandwidth by an average of 66%.”

This is great information for branches, but how does that affect telecommuters and consumers?

I personally work from home about 60% of the time and have found increasing problems getting into our corporate VPN. Now, while our IT department may not appreciate me mentioning this, it is through no fault of their own. This is due to the sheer number of users trying to access our internal resources from outside our firewall. We’re simply oversubscribed.

The coincidental thing is that I was simultaneously having a similar problem on my own home network. Being a confessed geek, I do have a home network that consists of several computers, printers, and other devices that consume bandwidth. I regularly move music and video across my network (I love my AppleTV) and find that accessing the Internet with my puny DSL line is simply killing it.

What did I do? Well, like any good consumer, I went and bought the latest and greatest in consumer technology: Gigabit Ethernet. Yes, I have twelve ports of “Gig-E” in my home. That really does nothing for my small DSL line, so the router has QoS to help. I accelerated both web access and email (to make my wife happy). This helped me tremendously, but I wondered what all the other “average” people would do in this situation.

How will service providers handle the growing need for bandwidth due to increased data for applications like video over IP(my major downfall due to my rampant love of Itunes) and voice over IP? I saw the problem on my own network and could handle my own prioritizations, but what of my friends and family? I don’t think they’ll be so fortunate.

Service Providers: Be warned, the killer apps are here and they are video and voice! How will you respond?

Philip Powell
Product Management
Brix Networks

The Quality Imperative - From Carrier Ethernet to VoIP and IPTV

Brix Networks — Mon, 26 Nov 2007 19:50:25 GMT

Pulver Media has just created a new Web 2.0 community called PulvermediaCommunity that is designed to bring the company and people who are involved in Pulver events together to discuss the future of the industry. Carl Ford created this community on the social networking platform ning (www.ning.com).

On the site, Carl started a discussion called "Is Ethernet our only landline future" which asks:

With so many home and enterprise networks adopting WiFi, is it logical to expect that the future interface to fixed line network will be Ethernet?

In the discussion, he references a presentation from the Fall VON given by Charlie Baker, Director of Product Management at Brix Networks that goes over the need for quality of service (QoS) to be implemented from the Ethernet core all the way through to advanced applications such as VoIP and IPTV.

The presentation is available on the site, but you'll need to register. But don't worry... registration doesn't start a flood of spam messages to your email inbox. And, there's some great information about assuring services from the core all the way down to the individual user.

IPTV Will Require Creative Marketing

Brix Networks — Wed, 05 Sep 2007 14:36:06 GMT

IPTV brings a host of benefits to service providers, including another competitive service offering to add their converged service bundles. However, uptake for IPTV services in the United States has been slower than expected.

So, IPTV service providers are starting to get creative. There is a post on the Daily IPTV blog by David Cotriss titled, "Ice Cream Trucks, Freebies and... IPTV?" that discusses the innovative ways that IPTV service providers are trying to get the word out about their offerings. Here's an excerpt from the blog posting about local guerrilla marketing using an ice cream truck:

“Because Verizon's and AT&T's services are still available in very limited areas, they're focusing on locally-targeted advertising and promotion,” said Len Feldman, director of IPTV analysis at Multimedia Research Group, Inc. “For example, in Connecticut, AT&T is using an ice cream truck that's equipped with a large flat-panel display to introduce U-Verse to potential customers.”

This is an example of innovative word of mouth at work. This gem comes via a story in the New England-based Hartford Courant, which explains that the truck circles “Little League fields, train stations and suburban cul-de-sacs” showing U-verse programming. AT&T is also using wine and cheese parties and movie nights, among other methods, to lure customers where service is available. There’s no indication of how effective these methods are so far.

This type of localized marketing can create a grass roots momentum shift for IPTV service providers, as customers in these communities see local involvement and a willingness to participate in the community. In fact, sometimes the community will get involved if there is a local champion:

The most outrageous example, however, comes by way of the “Bobby Choice” campaign, in which a Norwalk, Connecticut man is using the fictional name Bobby Choice to campaign against Cablevision’s monopoly in the city, hoping to give residents more choice of cable providers. His web site, www.bobbychoice.com, documents his activities as he embarks on the campaign. He has the backing of AT&T, and the campaign is aimed at generating buzz about U-verse. While it’s unclear whether the campaign will extend beyond Norwalk, the man “Bobby Choice” received a year’s free subscription to U-verse as part of the campaign, and is now holding a fictional contest to award five other residents the same prize.

Part of the reason that IPTV providers are using these innovative tactics is the uphill battle they are waging against incumbent cable providers. Digital cable quality is excellent, and subscribers are happy with their service.

One way that IPTV can start to compete is offering bundles of converged services, which include IPTV as well as voice, data, and mobile services. When bundled at a very competitive price, consumers are more willing to try new services in order to save money and simplify their billing.

But in order to survive and retain new subscribers, these bundled services need to be solid - i.e. provide a quality customer experience. And, they all need to deliver at the quality level of existing services. The IPTV service needs to be at the same quality as existing digital cable, or customers will leave, often taking all of their service dollars with them.

Converged service assurance is now essential to competing for triple play and quad play dollars in an increasingly disruptive market. When all of the elements of a successful converged service offering deliver a quality user experience, customers are happy and continue to subscribe month after month.

U.S. Behind Europe in VoIP Adoption

Brix Networks — Thu, 12 Jul 2007 15:20:59 GMT

According to research from In-Stat, the gap in VoIP adoption rates between the U.S. and Europe is growing. According to In-Stat, more than 14 million Europeans subscribed to VoIP services in 2006, with a total number of 19 million VoIP subscribers in Europe at the end of 2006. The firm forecast the number of VoIP subscribers to nearly double to 34 million subscribers by the end of 2007.

In contrast, there were only 4 million new VoIP subscribers added in the U.S. during 2006, with a total number of 10.6 million VoIP subscribers. According to In-Stat, the number of VoIP subscribers is expected to grow by only 50% in the U.S., with a total of 15.9 million VoIP subscribers expected by year's end.

A story posted on the Red Herring web site cites Yankee Group analyst Zeus Kerravala as to the reasons for the lower adoption rates in the United States:

"...demand for VoIP services was lower in the United States than in Europe because traditional phone services are cheaper in the U.S. and Americans also make far fewer international calls.

“Where the value proposition for VoIP is simply cost savings, you are never going to see the kind of adoption rates in North America that you see in Europe,” Mr. Kerravala said.

As carriers continue to see decreased revenue from standard telephone offerings, converged services like VoIP and IPTV will provide a path to greater revenue and profit margins. And, service assurance will provide a method for reducing operational custs and customer churn.

To read the complete story, please visit the Red Herring web site.

IPTV Quality is Key to Customer Retention

Brix Networks — Tue, 10 Jul 2007 15:54:20 GMT

David Cotriss at the Daily IPTV blog has posted a story called, "IPTV: It's All About the Quality." In this post, there is an interesting discussion by Steven Hawley, senior analyst at Multimedia Research Group, in which he goes into the three nested concerns for IPTV quality:

"A discussion of 'QoS' in an IPTV context is actually three separate but nested concerns: Video Quality (VQ), which refers to the video content itself – conformance to color and resolution benchmarks, which in many cases is mandated contractually by the content owner; Video Quality of Service (V-QoS), which refers to the error-free video delivery from the operator’s facilities to the customer premises over the broadband wide-area network; and Quality of Experience (QoE), which refers to the overall IPTV user experience, including application responsiveness, functionality, usability, and the service context that surrounds it."

In the piece, Hawley elaborated on the technical challenges associated with retaining customers for any IPTV service:

"To prevent the customer from defecting to a competitor (churn), the operator has to pay careful attention to technical factors across the deployment – which is best viewed as an IPTV delivery ecosystem. There are technical factors in all parts of this ecosystem. The complexity of the ecosystem makes it very expensive to implement, so to minimize capital equipment and software costs, IPTV operators assume an oversubscription model – in other words, they must deploy enough equipment to serve under 'average' conditions, yet recognize statistically-determined peaks, rather than design the deployment for full-time peak capacity.

Part of the solution for managing the complexities of IPTV deployments is to "build in" quality from Day One. An integrated service assurance solution helps IPTV operators manage customer expectations by staying in front of potential bottlenecks and being able to pinpoint problems quickly when customers do call. And, endpoint monitoring all the way to the CPE can help diagnose issues for specific customers. With IPTV, quality is THE major issue when discussing customer retention and reducing churn.

The blog posting offers some other great information, so please take the time to check it out.

Service Quality and the Telcos: Why Good Enough Isn't Good Enough

Brix Networks — Tue, 26 Jun 2007 14:52:46 GMT

Dr. Matthew Lucas posted this editorial in the July issue of Billing World and OSS Today magazine. The editorial gives Dr. Lucas' thoughts on service quality and why telcos must go beyond the "good enough" mentality that pervades Web 2.0 applications. In this editorial, Dr. Lucas gives his Top 10 reasons why compromising quality is a bad idea for telcos rolling out new IP-based services.

Here is a summary of the Top 10 reasons:

Service providers aren’t Web 2.0 companies - Most Web 2.0 companies make money from advertising - telcos require paying customers.
New service adoption - Customers are willing to give a new service one or two chances, but three strikes and you're out.
Margins collapse - Support calls cost $6 - $22 per call and truck rolls average $200, killing already tight margins.
Productivity applications will fail - Productivity applications - email, web access, etc. - that are not integrated properly will fail and cause a poor customer experience.
Entertainment services will fail - Unless telcos manage the rollout of entertainment services properly - with good quality - these services will fail.
IPTV will fail - Television service is extremely sensitive to quality, and IPTV requires a service quality framework before rollout or customers will leave.
Churn - The lower the quality of a service, the higher the churn.
Confidence erosion - Poor quality erodes confidence in not only the new service, but your entire brand.
Quality commands a premium - Companies that can deliver quality (like Apple) can demand a premium price for their products and services.
Political capital -Politicians trust telcos, but rolling out services with poor quality will cause politicians to lose confidence in the telcos.

Dr. Lucas concludes his editorial with this:

There is no question that telcos have to get more aggressive rolling out a broad spectrum of new service, and do so at a lower cost and very quickly. That is what IMS and SDPs are all about, and one reason why OSS/BSSs are so important.

In my opinion, though, innovation and speed should not come at the expense of quality. We should not aspire to become a dot.com industry where companies come and go looking for the short buck. If anything, the telecom service provider community should be putting service quality first and investing in quality user experience in every possible way—network, care, billing, applications, devices and services.

Here at Brix Networks, we couldn't agree more with Dr. Lucas. Over the past 12 months, activities around IPTV and mobile services has taken a leap from trial deployments to staged roll-outs to thousands of paying customers. And as the competition increases, service quality will be the deciding factor in retaining customers and selling bundled services over the long term.

To get Dr. Lucas' full explanation for his Top 10 reasons telcos need to roll out new services with quality from the beginning, visit the article on the Billing World and OSS Today web site.

IPTV Services Up 13% Worldwide

Brix Networks — Wed, 06 Jun 2007 18:29:16 GMT

A recent post on the Broadband TV News blog cited a report from Dittberner that Telco IPTV subscribers grew 13% to 5.4 million in Q1 of this year. The report, entitled “1Q07 Global Broadband Subscriber Survey," also mentioned that PCCW of Hong Kong was the largest telco IPTV operator with 800,000 subscribers, with France Telecom taking second place with roughly 769,000, and the company was in position to overtake PCCW by the third quarter of 2007.

Other interesting facts cited on the blog from the report include:

While France is the country with the most subscribers, Hong Kong, when viewed separately from China, has the highest penetration of the entire broadband subscriber base at 55.6%. It has a developed infrastructure, with short average LOOP length allowing virtually all its inhabitants to receive IPTV services.
With only about 40% of DSL lines being good enough for a TV service, the real penetration in France is about 25% of the addressable market. The country’s lead reflects the leadership of its operators in the IPTV market, which is a product of both the intense competition between DSL service providers, as well as the lack of competition from cable TV operators.
Western Europe still dominates the IPTV market but its share is down from 68% six months ago. Asia’s market share has increased from 28% to 41% over the same period, largely due to growth in China and Japan.
North America increased its share from 2% to 5%, but that was mostly thanks to growth at small independent operators. However, this may soon change as AT&T’s U-verse service is rolled-out. Although the success at IPTV is not likely to impact its cable operator competitors much in the next year, it should push the US into the ranks of the top 10 telco IPTV markets. AT&T could then be the largest Winluce (Microsoft/Alcatel-Lucent) customer.

“The fact that China has finally awarded licences for IPTV means that it will grow quickly and probably come to dominate the market at 7 Million IPTV subscribers within two years,” says James Heath, research director at Dittberner. “Japan is likely to have good growth and may challenge China for a while, but North America, with its entrenched TV operators, will be a slow roll.” IPTV is on the way to becoming an accepted strategy for most service providers. Now the business of making it profitable will be the goal, and customer service will be the focus.

According to the report, here are the top 10 IPTV markets:

France - 1,410,000
Hong Kong - 920,000
China - 720,625
Spain - 427,600
Japan - 304,000
Taiwan - 269,000
Italy - 211,700
Holland - 167,500
Belgium - 149,491
Sweden - 145,000

Set-top Box Prices Stabilizing, Likely to Increase with New Functionality

Brix Networks — Thu, 17 May 2007 15:47:55 GMT

According to recent estimates from IMS Research, the average semiconductor bill of materials cost (BOM) for set-top boxes dropped 37% from 2004 to 2006, going from $59 to $37. The firm states the precipitous drop was caused primarily by rapidly falling prices for MPEG-2 core decoders chips in preparation for the transition to MPEG-4 AVC (ITU-T H.264) – both in the HD and SD segments. However, the company is forecasting this trend will change, and from 2007-2011 the overall average cost of a set-top box semiconductor BOM will stay near $41.

According to IMS Research analyst Stephen Froehlich:

“Overall spending by set-top box makers is likely to increase as set-top box volumes grow and the product mix shifts to more advanced set-top box designs. Specifically, significant amounts of new spending will go for more hard disk drives in more DVRs and also for no-new wire or wireless network interface modules on many of the boxes being installed in multi-set-top households.”

In addition, we believe that endpoint monitoring software agents will make their way onto set-top boxes over the next few years, allowing IPTV service providers to monitor their customer's quality of experience (QoE) while giving them a competitive differentiator over those providers without endpoint monitoring technology.

Other interesting insights from the report include:

Linux will ship on more than 30% of set-tops by 2011 as increased processor performance eliminates the need for real-time operating systems.

Open standard middleware will be running on 27% of installed STBs by the end of 2011.

The rapid growth of Chinese cable and IPTV in 2006 resulted in NDS and other established conditional access vendors loosing market share to Tongfang

IPTV: It's All About the Quality

Brix Networks — Wed, 09 May 2007 18:58:33 GMT

There's a great story on the Daily IPTV blog by David Cotriss that explores the issues facing telcos and cable companies as they roll out IPTV as part of a bundled services package. The story does a great job of explaining the many quality issues involved in rolling out IPTV, and that quality will be the key differentiator in customer retention.

In talking about the technical aspects and challenges of IPTV quality of service (QoS), Steven Hawley, senior analyst at Multimedia Research Group, talks about the three different quality concerns for IPTV service providers:

It's great to see a discussion about the real-world application of converged service assurance and how it impacts the customer, and the service provider's bottom line. If you're interested in converged service assurance, make sure you check out David's article.

The Need for Endpoint Monitoring – The Coming Storm

Brix Networks — Mon, 07 May 2007 15:31:23 GMT

A customer support interaction at home not too long ago got me thinking about the issues that service providers – both cable companies and telcos – will face as customers buy into the concept of triple-play or quad-play services.

Recently, our family received a gift of a 52” LCD 1080i television. With this new HDTV, our family was ready to watch high-definition programming (including our beloved Red Sox and Patriots) in the comfort of our own home. All we needed to do was pick up the TV, plug it in, and we’re watching a whole new level of picture quality. Right?

Wrong! Unfortunately for my cable provider, it seems it’s not that simple. After checking out the crisp, clear high-definition picture on our model of HDTV in the store, we brought our new HDTV home, plugged it in, and hooked up the high-definition set top box (STB).

But the picture was not nearly as crisp and clear as it was in the store. It looked fuzzy at times, especially during a quick-moving action scene. What gives? Is it the connection? The service? Do I need an HDMI cable? Are my picture settings correct (there are about 100 of them on the HDTV, so hopefully the defaults are the way to go)?

Being somewhat technical (and more than a little stubborn), I decided to try and diagnose the problem myself. First, I checked all of the STB settings. They were correct according to the manual. Next, I checked the cable connections, and those were OK. And since I used the cables supplied by my service provider, I had the right cables.

At this point, I’ve done everything I can on my end. Now, I have to call the cable company’s customer service line. I’ve been waiting a long time for a high-definition picture, and I can’t figure it out on my own, so you’ll have to forgive me for breaking the “guys rule” and asking for help.

Basically, here’s what the call with the Customer Service Rep (CSR) went (and I’m paraphrasing):

CSR: Hello, thank you for calling XYZ support. How can I help you?

Me: I just plugged in my new HDTV with your digital STB and I am ready to watch high- definition television. But the picture quality isn’t good. Can you help?

CSR: Are your STB and TV currently on?

Me: Yes.

CSR: Please turn them both off.

Me: OK. They’re both off.

CSR: Let's wait 30 seconds to download new software to the STB. [As an aside, have you ever waited 30 seconds on the phone with a total stranger? It feels just like when you’re on an elevator with only one other person. It’s very awkward.] OK, sir, please turn the TV and STB back on.

Me: They are both back on, and the picture is still not quite right.

CSR: OK sir, I will place a service call for you. Will next Wednesday work?

Me: You mean you’re going to roll a truck?

CSR: Yes sir, someone needs to come to your home to identify the problem.

Me: OK. I'll see your service guy next Wednesday between 5 and 7pm. Thanks.

Hopefully, my cable service provider doesn’t have to roll a truck every time a new HDTV user comes online. Don’t get me wrong. I’m extremely appreciative that my service provider wants to make sure I’m up and running. However, when the CSR had me on the phone, why couldn’t the problem be “debugged” and a fix presented at that time, without rolling a service truck? Do they not have the right tools to solve the problem? And, do they have tools to predict when issues before they happen?

If you frequent this blog, you know that our opinion is that the best way to solve these issues (both new service turn-up and 24x7 monitoring) is to have visibility to the end-point, not only to the STB in the case of IPTV, but also to the multimedia terminal adapter (MTA) or analog terminal adapter (ATA) in the case of VoIP or broadband data, respectively.

Without this visibility, service providers have no idea if they are delivering an excellent quality of experience (QoE) for their subscribers, or even if their subscribers are happy, until they receive a phone call to their customer service center complaining about a problem.

As service providers start rolling out IPTV on a large scale to realize the cost savings and feature benefits of this new technology, they will face an even bigger task of preventing installation and ongoing maintenance issues. Their field technicians will be less familiar with the new equipment, and even simple problems will be difficult to diagnose without the proper tools. Most “typical” subscribers (like me) will be patient with turn-up issues (it could be operator error on our parts), but once the service has been up and running, subscribers tend to be less patient. Especially if the Red Sox are playing the Yankees and the HDTV signal is not working properly.

According to Geoffrey Moore’s book, “Crossing the Chasm,” when new technologies like IPTV and VoIP first start appearing, it’s the technology enthusiasts and visionaries who will work through the technical glitches to stay in the lead. When they’ve helped work out the bugs, the technology is ready to “cross the chasm” to the mainstream market and pragmatists like myself. The mainstream market will not put up with a poor user experience.

I believe that IPTV is on the verge of “crossing the chasm” into mainstream acceptance –particularly in European and Asia-Pacific markets. Consumers are buying HDTV sets in record numbers, and the networks are putting out more HD programming. Cable companies and telcos that want to include IPTV in their bundled offerings need endpoint monitoring tools to stay ahead of customer service issues, and deliver the quality of experience that customers have come to expect for their television programming.

If the service providers aren’t careful, this new IPTV revolution will mean more revenue but much less profit due to increased customer service demands with the new equipment. Being able to handle the increase in turn-up issues alone are going to keep the service providers busy. Imagine when there are issues with on-going service?

Endpoint monitoring gives the service providers visibility all the way into the customer’s home, allowing them to not only diagnose problems, but also to continually monitor their network to stay in front of issues.

Steve DesRochers
Vice President, Solutions
Brix Networks