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2 May 2019

Turk Telekom to migrate IPTV to OTT but doubts over DTH

Turk Telekom is to start retiring its 10-year-old IPTV service and migrate subscribers to a new OTT platform based on middleware from Alticast called AltiPlatform – Web. This has been widely reported as affecting all 3.6 million existing Turk Telekom pay TV subscribers, but this is misleading as not all these are IPTV and many are using the Tivibu Go service, which is already OTT, comprising web TV, mobile and smart TV subscribers.

The move does though underline a trend away from some of the legacy IPTV platforms that made great inroads from around 2006 onwards, such as Microsoft’s Mediaroom, which in recent years have proved less agile than many cable TV equivalents and been begging to be replaced by more flexible OTT platforms. Turk Telekom’s IPTV platform was deployed and managed by local systems integrator Birtel Network Technologies running set top middleware from SeaChange and secured by the Verimatrix Video Content Authority System (VCAS).

Turk Telekom’s IPTV platform had actually been more successful in recent years, but this had nothing to do with its technical merits and everything to do with football rights, with subs soaring on the back of European Champions League and Europa League coverage up to 2018/2019. Those rights have now passed to beIN Media’s Digiturk up till 2022, so Turk Telekom may find its fortunes reversing or at the very least subs gains tailing off just as it migrates to this new platform.

So, Turk Telekom had gained market share rapidly over the last two years, starting from mid-2016 when the country had almost 6.2 million pay TV subscribers in total, with DTH dominant on 4.3 million, cable on 1.15 million and IPTV on 700,000. Digiturk, now owned by beIN Media, was the leader with its DTH service on 2.7 million, followed by D-smart on 1 million also on DTH. Turk Telekom totaled 550,000, 400,000 for the IPTV version of its Tivibu service and just 150,000 for the DTH version.

But those rights have propelled Turk Telekom to 3.6 million subscribers now, although that total does include around 1.9 million for its Tivibu Go OTT service, which is akin to Sky’s Now TV or AT&T’s DirecTV Now as skinny versions of the main package. The subs total for the main Tivibu Home, including IPTV and DTH, is 1.66 million, up from 1.16 million a year ago. Turk Telekom declined to give us a breakdown between IPTV and DTH but we estimate it is close to 50/50, so that is the real number of subscribers affected by migration to the Alticast platform. That means the company has crept onto the radar for DTH by popping well above 500,000 subscribers for that version, possibly approaching 1 million. We also anticipate that number sinking back over the next year or two now that Digiturk has those European football rights to reinforce its domestic Turkish Süper Lig rights also until 2022. However, Turk Telekom has secured rights with Turkish Basketball Federation for the country’s Super League (BSL), running until the 2020/2021 season.

The other relatively new force in Turkish pay TV is the country’s leading mobile operator Turkcell with almost 36 million cellular subscribers and owned by Swedish telco Telia Company, formerly TeliaSonera. Its Turkcell TV+ service is available to subscribers via mobile or fixed internet connections anywhere in the world in principle and accounts for 42% of the country’s OTT subscriptions, which is almost dead level with Tivibu Go.

The new Alticast-based service therefore faces stronger headwinds than might at first appear in the light of Turk Telekom’s recent advances. The telco hopes that by enabling more rapid deployment of apps it can surge forward in SVoD where Tivibu Go and Turkcell TV+ have proved very successful between them in squeezing out the big US incumbents. Netflix has been confined to under 10% share of the Turkish OTT market so far. This is partly because Netflix has little local Turkish language content in a country with a strong indigenous movie and TV industry, earning $350 million a year in export of TV shows.

Meanwhile, Alticast, based in South Korea, has notched up several decent contract wins among operators in countries with strong local content traditions, such as Belgian pay TV operator Voo. Here Alticast is the lead systems integrator and is upgrading existing évasion set tops with its AltiPlatform middleware, while enhancing the current backend with various components from its modular video service platform, Ambient TV. As at Turk Telekom, the platform was chosen for being considered fast for deploying new apps with a focus on VoD.

Although not in these two cases, Android naturally features in a growing number of Alticast’s new deployments, as at Kbro, one of the largest broadband and cable TV service providers in Taiwan. Here Alticast’s AltiPlatform middleware is integrating Kbro’s existing service infrastructure with Android TV for delivery of traditional cable services, while introducing subscribers to YouTube, and the 3,700 TV apps on Google Play. As so often with such deployments, Alticast was chosen for being able to develop a customized UI on top of Android TV.

Other recently acquired Alticast Android customers include local Korean operators KT Skylife and CJ Hello, with Kbro being the first in this category outside its domestic market.