The statement made this week by Motorola that it has shipped two million IP set tops to date serves not only to testify that the IPTV market is alive and well and picking up speed, but it also tells us that big business, in the form of Motorola, is making its mark within it.
Joe Cozzolino, vice president & general manager, Home & Networks Mobility EMEA, told us at IBC this week, ‘It has taken just 5 months to ship the second million of those set tops. It took around 7 years for the first million.
Like most markets Motorola has entered, it has been a late rally that has seen it become one of the leading set top providers in IPTV, waiting almost until it was too late to enter, and making its move only when the market was seen to be scaling to the kind of size that Motorola is comfortable with.
It bought Sweden’s Kreatel, which Cozzolino says is now fully integrated with Motorola, back in January 2006, Kreatel had always been associated with the pioneering IPTV movement and was one of the premier set top makers even back then. Under Motorola it has been joined by encoding specialist Modulus Video, which has just announced that it was behind the encoding for the BT Vision IPTV service in the UK, and by Terayon Communications (digital advertising insertion), Broadbus (VoD), Ucentric (home gateways), Leapstone (service delivery platform). Tut Systems was also acquired in that spending spree, but Cozzolino says that this was more for the Edge QAM that Tut brought than the encoding product lines which competed head on with Modulus.
‘No one went out to buy an encoder company and came back with the wrong one. We still push the Tut encoders at the low end of the market, and they are good for that, but the Modulus HD encoders are our lead product at AT&T,’ said Cozzolino.
Cozzolino is perhaps the first person that we can ask the question that has been on the tip of our tongue ever since the Kreatel buy ‘Why not buy a middleware offering?’
‘We don’t want to limit ourselves to one part of the market,’ says Cozzolino, ‘there are those customers that like Microsoft’s Mediaroom and those that don’t, they spilt around 50:50 each side, and we want to be able to play among all of them.’
In Europe the big customers are Telefonica, where Motorola finds itself working with Acatel but not Microsoft, and TeliaSonera, where the heavy Kreatel set top numbers have shifted.
The two millionth set-top was shipped as part of the provision of 150,000 units to TeliaSonera, Sweden’s largest telco. After announcing 100,000 subscribers in May 2007, TeliaSonera has already grown to over 150,000.
I supposed we love the quote in the Motorola press release the most, mostly because we provided it, which ran ‘IPTV is growing. The number of IPTV homes will rise from around three million now to more than 50 million in the next five years, but it is the extra services which are possible on an IP highway into the home that are so compelling,’ said Peter White, principal analyst and founder, Rethink Research Associates. ‘Home security, music, gaming and new advertising capabilities make IPTV so exciting and will turn it into a $20 billion service industry by 2011. But the reduction in churn that it creates on fixed lines will halt the erosion of the $1 trillion global fixed-line telco market.’ If we said it, it must be true.