• From: "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx>
  • To: <opendtv@xxxxxxxxxxxxx>
  • Date: Mon, 24 Apr 2006 14:49:54 -0400

This article is pretty funny.

First of all, I think it confuses IPTV with Internet TV. I think of CSI =
for pay over the Internet as being Internet TV, because you aren't =
depending on the service provider to make the make the content =
available. The service provider only provides a broadband connection. =
CBS makes the show available through its own web site.

What's funny about the article, as I read it, is that it's saying this: =
"Consumers have shown interest in downloading TV shows into their iPods. =
So we'll plan to make give home TV systems that same function. But in =
doing so, we'll make it so damned complicated that no home user will be =
able to install his own TV anymore. They will instead have to buy =
integration services, and we'll soak them on an on-going basis for this =

The image is that of the hapless TV consumer, with fish hook firmly =
implanted in his cheek, being reeled in, all the while being told he =
really does want it this way, trust us.

The words are only slightly different. Here's the actual quote:

"We are the ones who know there is a revolution in home entertainment =
and home networking. The consumer now wants it. We will tell them how to =
get it, bring it in for them, set it all up and all they have to do is =
sit back and click."


April 12, 2006

Serving up IPTV

The table's been set with top-tier video content--now it's up to =
integrators to sell services around Internet Protocol TV technology

By Karen Jones

A major barrier to entry that's been blocking the consumer-electronics =
industry's determined drive to sell the digital home to consumers--the =
lack of top-tier video content for broadband downloading--recently has =
been removed. To much media fanfare, consumers have demonstrated they =
will pay to download favorites such as "CSI." And, as more content =
providers join in, along with bigger broadband pipes and better =
resolution formats, digital integrators will have the opportunity to =
sell services surrounding Internet Protocol TV (IPTV) technologies and =
drive sales of digital home products.

The content revolution ignited by iTunes and the iPod Video last year =
"opened the floodgates," says Rich Green, CEDIA board member and =
president of Rich Green Ink, a custom designer and integrator. Internet =
portals for watching, buying and selling video content are now =
attracting high-profile partners. MTV, for example, is releasing content =
from MTV, MTV2, Comedy Central and Nickelodeon on iTunes. Google Video, =
which describes itself as "the first open online video marketplace," =
lets users search, watch and purchase content, both studio-driven =
("CSI," "Survivor") and home-grown. Google launched the site to improve =
the overall video search experience by giving users access to content =
that isn't easily available through traditional online channels. =
Partners include CBS, the NBA, Sony BMG, MediaZone.com and many more. =
"People are now aware of this and it leads them to think, 'How do I get =
this?" and then, 'How do I get this on my TV?' " Green says.

Along with the growing consumer awareness, a change is occurring on the =
delivery side. Green and others think the key to success in the digital =
universe is not about selling products anymore, but selling integration =
services. "No one makes money selling iPods or Media Center PCs, and =
it's harder and harder to make money selling plasma displays," he says. =
"Custom installers have to think about selling their time. They need to =
ask, 'How much can I make per minute?' " Most dealers do not know how to =
price their services, but billable services, he says, will be important =
to sustaining their businesses over the long term. He also advocates =
in-house research. "I strongly encourage dealers to buy Media Center =
PCs, video iPods and other devices. Download content and get your =
engineers to play with this stuff so they can be conversant with it."

Green's method for preparing a home network for IPTV and other =
technologies begins by what he terms "going upstream." "I first think =
about how broadband comes into the home and how we can apply home =
networking techniques to get rock-solid Ethernet backbone to support =
video streaming all the way up through HDTV-quality multiple screens," =
he says. "From that point we can do almost anything we want depending on =
what we hook up to the end of that wire."


Though opinions differ as to what can be called IPTV, Deepa Iyer, =
analyst at Parks Associates, says it is an "umbrella term" for both the =
current broadband delivery of video, either streamed or downloaded =
(iTunes, Movielink, MediaZone, etc.), and the eventual leap to =
fiber-optic broadband being readied by the telecom industry. "Everyone =
is trying to create the ultimate TV experience," says Iyer, who explains =
that telecom-delivered IPTV will enter the home through the next =
generation of set-top boxes.

Until recently, the question of who would win the battle for the digital =
home hinged on the presumed adoption of one =FCber-device linking all =
digital home media. Whether that device would be PC-based, such as =
Microsoft's Media Center PCs and Intel's new Viiv platform, or a =
sophisticated DVR has been hotly debated. It is more likely now that =
several technology solutions will coexist as the broadband delivery of =
digital video becomes more pervasive, industry experts say.

"Certain people will migrate to set-top box/DVR technology because it =
accomplishes 75 percent of what they want to get, but I think there is =
room for both that and PC-based solutions," says Dan Schwab, vice =
president of marketing at D&H Distributing, Harrisburg, Pa. "I sense the =
overall market will expand, so it's not that both will fight for a =
bigger piece of the pie but that the pie is expanding." The =
proliferation of top-line content is "the final ingredient" to making =
the digital home complete, Schwab says.

Meanwhile, Microsoft is trying to cover many bases. In addition to the =
Windows Media Center operating system, the company has been trying to =
push Microsoft TV, a non-PC-based client and server software platform =
that will run on new IPTV set-top boxes. Ed Graczyk, director of =
marketing for Microsoft TV, says the eventual deployment of IPTV will =
change the role of the television and improve the perceived value of the =
connected home.

"Up until today, TV has been a closed proprietary architecture," he =
says. "You don't even have commonality across cable platforms. IPTV is =
an open platform that brings a host of benefits." Some of these include =
freedom from broadcast schedules; more connectivity between the TV and =
home devices; a new generation of IPTV-ready receivers such as TVs, DVD =
players and game consoles; hundreds of channel choices; and niche market =
programming, all of which will lead to a more competitive marketplace.

The connected home of today has been, for the most part, "all about =
connecting PCs or game consoles and home automation," Graczyk says. As =
new technologies emerge, so does consumer frustration, giving digital =
integrators an opportunity to step in. "Today you need a Ph.D. just to =
buy a TV set," he says. "I get confused and I'm not your average =
consumer." But Graczyk cautions that video is different than connecting =
PCs and whole house audio. "The difference in the bandwidth required for =
streaming music and IPTV is pretty substantial, and there are nuances to =
video in terms of quality, standards and formats," he says. "Custom =
installers can help consumers wade through the morass of options. It's =
not just the network but all the pieces."

Though content providers are scrambling to find an Internet portal to =
sell their products, that was not always the case, says Gordon Dolfie, =
director of marketing for Intel's Content Service Group. "Back in 2002, =
Hollywood was accusing the PC industry of being in the business solely =
to pirate content," he says. "We never agreed," adding that Intel worked =
hard "behind the scenes" for years to iron out digital rights management =
issues. Now studios are starting to release their best content online =
and revisit distribution models. Intel has partnered with actor Morgan =
Freeman's production company Revelations, for example, to form =
ClickStar. They will release "Ten Items Or Less," starring Freeman, =
simultaneously in movie theaters and via their Viiv technology platform =
later this year. Some of Intel's other Viiv-based content partners =
include DirecTV, AOL and Google Video.


Dolfie says in addition to technical and business training programs for =
digital integrators, Intel will provide material to "pass on to" =
consumers. This can help drive sales of new products into the home and =
to upgrade existing systems. "It is a huge opportunity for the channel," =
says Bill Davidson, marketing manager for Intel's North American =
channel. "People still want and need help," he says. "Custom installers =
will thrive but they need to figure out how they will differentiate =
their offerings."

One way integrators can do that is by offering differently priced =
packages that fit the budgets and needs of particular clients. Bill =
Ablondi, analyst at Parks Associates, sees an "installation gap" between =
the very high-end consumer, who might spend between five and six figures =
on a whole house entertainment system, and the midlevel mass market. =
"Let's suppose we are not high-end customers but want a digital home. =
How are we going to get it?" He adds that if a customer spends $2,000 =
for a PC and an integrator is going to charge another $2,000 to network =
it, they may not see the value-add. "The question for integrators is, =
'How am I going to make money and what are the margins we are going to =
get on the system?' " Integrators, he and others say, are experimenting =
with prepackaged systems, which could be attractive to the midlevel =
buyer. "Someone comes into your store and says, 'I have $4,000 to $5,000 =
to spend on a home theater system, what can you do for me?' The dealer =
can put a prepackaged system on the table right there," Ablondi says.

Coming up with a sensible pricing model so midlevel consumers feel they =
are getting good value and integrators aren't undercharging is a fine =
line, Green says. This is further complicated by misleading advertising =
from big-box outlets. Many consumers are lulled into thinking that =
networking is really plug-and-play so why pay for installation, whereas =
plug-and-play is not usually the case. "Consumers need help and should =
pay appropriate fees to certified installers," Green says. "I have been =
in the business 27 years and every day I feel I have something to =

High-end, midlevel or the eventual mass market, today's digital =
integrator is the bridge between the creators, manufacturers and =
providers of emerging digital technologies and the consumers who want to =
utilize them throughout the home. "We are like the town criers of old," =
says Dino White, president of Dicyn Solutions, a New York-based =
technology provider and digital home networker. "We are the ones who =
know there is a revolution in home entertainment and home networking. =
The consumer now wants it. We will tell them how to get it, bring it in =
for them, set it all up and all they have to do is sit back and click."

All material on this site Copyright 2006 CMP Media LLC. All rights =
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