Instead of Ericsson losing patience with its Tandberg encoder buy, the wireless base station leader has plowed resources into the company to try to turn it into a world class IPTV supplier. But what is thin on the ground is any news that any customers are emerging.
Ericsson was one of the founder members of the Open IPTV Forum back in March, 2007 with the aim of bringing about some kind of standardization in IPTV ‘ but it wanted to do this without anyone that had ever built an IPTV network at the time. We derided the organization (and still do to some extent) for not successfully inviting either Alcatel or Microsoft, despite gaining Mediaroom customer AT&T as a member.
At the time the full list was AT&T, Ericsson, France Telecom, Panasonic, Philips, Samsung, Siemens Networks, Sony, and Telecom Italia but since then it has expanded and Alcatel has very quietly joined the organization, but it clearly is still a North European adventure to try to wrest control of IPTV from the existing market leaders.
But Ericsson itself, rather than the Forum it has spawned, has yet to make its mark in IPTV, despite this it has picked up spurious ‘product awards’ for innovative products that no-one has ever installed ‘ while its rivals Alcatel, Huawei, ZTE, UTStarcom and of course Microsoft Mediaroom, have all continued to dominate IPTV ‘ which itself is mushrooming into a genuine source of operator spend.
Ericsson’s Tandberg subsidiary continues to do okay in the decoder market, but as the market growth for encoders begins to fall, and as encoders become more commoditized, it needs to create a full service platform ‘ something akin to market leader Alcatel ‘ and its partner Microsoft Mediaroom,
While the PR tells us that this month Tandberg Television received its fifth industry award for its iPlex UltraCompression HD and SD IPTV head-end solution, rivals tell us that iPlex is dead and no-one wants it. The iPlex range of encoders came out of SkyStream Networks, a company that Tandberg acquired just prior to being taken over by Ericsson, and this forms the basis of its IP centric encode platforms and those offered in the mobile TV sector. This is a sector dominated by Envivio and Thomson Grass Valley and we hear little or nothing of iPlex wins here (interestingly Grass Valley is up for sale and perhaps Ericsson could be tempted to go for a second bite at the encoder space).
With all of this as background, the emergence of new features and functions at Tandberg, such as its dynamic advertising insertion announced this week, on time shifted TV (through networked PVRs it must be added, not home based DVRs) appears to be the sound of Ericsson slowly rolling out the type of function that it will need if it is ever going to take on the Mediaroom’s of this world head on.
We laughed when we heard that it was an ‘industry first’ and it’s annoying, because Ericsson knows it isn’t. Cable operators put their own adverts into nPVR streams, but in the US the law in nPVR is still pretty unclear, with Cablevision taking an appeal to the Supreme Court to allow it, while Time Warner Cable offers a ‘same day’ networked PVR service with adverts which cannot be fast forwarded.
So in the US at least, this whole idea has been on ice for about three years and indeed three years ago Tandberg made its own announcement that Comcast Spotlight was using its AdPoint software to automatically place ads in on-demand content for Comcast ‘ though we accept this isn’t exactly nPVR ‘ more VoD ‘ but technically there’s very little difference?
In all of this it is easy to forget that Tandberg acquired N2 Broadband, a US VoD server company back in January, 2005, and that many of these innovations will derive from that acquisition, perhaps not directly from its technology, but more its customer base and the direction R&D had to take at Tandberg to reposition the servers for the way the market is shaping.
The new offerings on show this week from Tandberg are its Xport Time-Shifted TV for network-PVR, working alongside its AdPoint advertising platform.
Tandberg has also launched a new version of its WatchPoint Content Management System which allows operators to expand onVoD to new platforms ‘ pretty obviously designed to work across three screens ‘ to deploy the same (mostly video) assets across handsets, as well as IPTV and the internet. Watchpoint features a file-based content ingest so it can be used for VoD programs, advertising and music, as well as for games. But content management is a very small part of the equation for IPTV services and none of this is ground breaking or difficult. Instead it’s all rather late and a bit lame. The overall impression is that this is what would happen with a well funded Tandberg carrying on, with no real input from Ericsson.
Recently Ericsson launched its own version of IPTV middleware and when you add these latest additions to its existing encoder offerings and the fact that Ericsson is making a great play out of this being the only IPTV system which can be harmonized with its own IMS system (IP Multimedia Subsystem) there may be a story to tell.
That IMS integration is supposed to help it with integrating wider service functions, such as security or billing. Ericsson has yet to explain in public how this gives an operator any advantage in delivering IPTV and the idea that half of Europe is going to throw away their existing IPTV middleware and set tops in order to install something from the inexperienced Ericsson remains laughable and yet a lot of supplier companies believe it will happen.
Other suppliers which Ericsson has announced within its eco-system include content aggregator Accedo Broadband, video quality monitoring company Agama Technologies, set top suppliers Amino and Tilgin (now part of Amino), server supplier HP and home gateway company ZyXEL. Sun Microsystems is also a partner, though Ericsson has yet to say in what capacity, as well as France Telecom owned conditional access company Viaccess, which recently bought Orca Interactive, the Israeli IPTV middleware company.
This all has the flavor of the Microsoft effort in IPTV which began as a demonstration at shows, suffered a two year delay in being brought to market and then arrived, bereft of many of the initially specified features, which took another three years to turn up. So the picture emerges of the giant who will keep bashing away at the mission until it finally gets it right.
The big difference is that Microsoft was able to point to AT&T and Verizon and BT and Deutsche Telekom as valued and passionate customers and supporters. It had a ready made revenue stream for when it finally brought its systems into line, and although we still feel that Mediaroom is unlikely to be profitable in the near term, it is now an established business a mere 5 years after Microsoft embarked down this road.
We assume that Ericsson thinks that Tandberg is going to bring in more customers by some form of IPTV osmosis, where encoder customers tear up their existing middleware and install Ericsson code over some supposed cost benefit brought about by using IMS to take its offerings to the cellular level.
We don’t buy it, and we don’t see that anyone else has either, apart from Ericsson’s rivals which now dominate the Open IPTV forum that it founded in order to control the development agenda.
Perhaps a more concrete item of news this week is the fact that Mediaroom has brought on line its latest customer in the form of MTS Allstream in Canada. It announced the deal a year ago and services are about 4 months later than it predicted, but this shows the growing maturity of the Mediaroom code base in coming to market so quickly. The system went live in Winnipeg offering 250 TV and music channels, VoD and DVR.