Regulations and customer understanding are the two biggestbarriers to the success of IPTV (Internet Protocol television), sayoperators, content providers and vendors that participated in asurvey done by the Economist Intelligence Unit Ltd. and AccentureLtd.
Even though they vary widely by region, regulations present thelargest worry in the IPTV market, according to the study releasedon Thursday that surveyed 300 executives around the world.
The net neutrality debate in the U.S. and regulations that bartelecommunications operators from offering IPTV in someAsia-Pacific countries could slow down the deployment of services,said Ray Dogra, global IPTV lead at Accenture.
Operators around the world are testing and in some casescommercially offering television programming delivered overbroadband connections, a service known as IPTV. The technologyallows companies like telecommunications operators to enter thetelevision market and enables services such as video on demand.
Customer understanding, standardization issues and marketing andpricing also ranked high among areas of concern in the IPTV survey.Accenture’s Dogra, however, noted that marketing and pricing “arethings that should be in an operator’s control to influence theadoption curve.”
One aspect that didn’t appear on the list of concerns wastechnology, indicating that the IPTV market is generally confidentthat the technology behind IPTV is developed and ready, hesaid.
The study’s respondents said that drivers for deploying IPTVinclude developing new revenue streams, growing the number ofbroadband users, reducing customer turnover and acquiring newsubscribers.
Typically, operators rank reducing churn and increasingbroadband subscriptions as the top reasons for offering IPTV, Dograsaid. The results show that the industry is growing more confidentin using IPTV to drive revenue, he said.
Video-on-demand, integrated services and gaming will create thenew revenue streams, the survey found. Advertising ranked quite lowon the list of sources that respondents identified for potentialrevenue from IPTV. That may indicate that the market is viewingadvertising from a broadcaster point of view, Dogra said.
Broadcast advertising revenue worldwide has been declining whileWeb-based advertising has significantly grown, he said. “IPTV hasthe opportunity to have the richness and impact of TV and mergethat with the targeting capabilities on the Web to find some smartways to monetize advertising,” he said.
The survey also found that the respondents expect that IPTV willbegin to generate significant revenue in three years.