Indian IPTV subscribers to reach 966,000 by 2011

BANGALORE, INDIA: IPTV, a niche technology, landed with much expectation is opening its arm slowly in India. According to the latest reports from IDC, the number of IPTV subscribers is likely to reach 966,000 by 2011 at a CAGR of 156.8 percent.

In an interaction with Abhigna N. G. of CIOL, Peter Papaioannou, operations director, video and cable solutions group, Cisco Systems Asia Pacific, throws light on how Cisco's IPTV plays a major role in offering quality services to valued customers. Excerpts:

CIOL: What Cisco is doing in the IPTV space in India?

Peter Papaioannou: Globally, the IPTV phenomenon has gained immense popularity. According to Infonetics Research, service providers globally spent $304 million on IPTV-related services infrastructure in 2004, and this is likely to grow to almost $4.5 billion in 2009.

It predicts that worldwide IPTV service revenue will skyrocket to over $44 billion in 2009 and also notes that subscriber growth is strong in all regions, while Asia Pacific is leading the way. This is thanks largely to the faster forms of DSL, like VDSL and ADSL2/2+, which are stimulating subscriber growth.

In India, as per IDC, the number of subscribers is likely to reach 966,000 subscribers by 2011 at a CAGR of 156.8 percent during the 2006-2011. IDC further expects 15.9 percent of all residential broadband subscribers in India to use IPTV by the end of 2011, up from less than 1 percent of all broadband subscribers in 2006. India currently has around 65 million cable and satellite homes.

From the consumer’s perspective, IPTV allows the user to experience digital quality TV with an added advantage of being a ‘pay-per-view’ service. Consumers can expect services such as video on demand, videoconferencing and interactive TV – pause, fast forward and rewind live TV or recorded content stored on the service provider’s remote servers. Therefore, all three parameters – comfort, cost and quality – are taken care of.

The service provider can effectively utilize the opportunity to add on to their revenue stream. In short, IPTV offers a win-win situation for both the operator and the customer.

CIOL: What are the services that IPTV offers to enhance the TV viewing experience?

PP: IPTV will bring services such as on-demand video content and network-based DVRs (digital video recorders). Using DVRs, the content is potentially stored on the network and streamed to your device. The content, which is typically available in streaming media format on the Internet, will be available for viewing on the television.

IPTV will also bring about the integration of video streaming with conferencing capability, and interactive TV applications, which will provide the user with a much richer experience than they have today.

The brands of the future will be network brands and service brands. They provide an opportunity to service providers, and the bundled brand becomes synonymous with the level of entertainment that consumers consume.

IPTV will deliver a different type of content from what we view on TV today. Content will be interactive and the clicking functionality offers viewer added features, which bring a differentiated experience for the end user.

CIOL: What are the major challenges in deploying IPTV architecture?

PP: It is true that the growth of broadband penetration has lagged behind targets. However, the growing speed of adoption of broadband, particularly in the metros and the urban areas, is an encouraging development for the future of IPTV in India.

All major service providers are investing in advanced IP-based-next-generation networks (IP-NGNs) and the necessary infrastructure to support IPTV. IPTV will be a key service in their triple-play offerings.

CIOL: How do you see the progress of Indian telecom in the IPTV space in India?

PP: The leading service providers have either rolled-out or are in the various stages of rolling out IPTV services. The industry, technology and infrastructure are already geared up for the adoption of IPTV. However, a slight push is required on the government’s side to make it an overall success in India.

Currently, most major service providers are offering or in the process of offering IPTV in the metros. The exact rollout timeline for the country and business model for services are still under progress. While MTNL and BSNL have taken the lead, private operators such as Bharti and Reliance are not far behind. In December 2006, Reliance announced that the company would launch IPTV services in 10 cities, including four metros, by the end of 2008 fiscal year.

CIOL: Looking forward, how do you see the future of IPTV in India? Will it remain a niche technology over the next years till the country sees an improvement in the broadband penetration?

PP: IPTV is still in its infancy in India in terms of commercial deployments and experience. The pay TV market in India remains extremely regulated.

In addition, an extremely fragmented cable segment with thousands of small cable operators might present an opportunity for IPTV operators based on growing middle class and high TV watching habit.

Much remains to be accomplished in terms of resolving issues with regard to bandwidth and broadband pricing. However, beyond regulatory issues, the growth of IPTV will primarily depend on broadband penetration rates as well as on pricing, quality, and content of IPTV offerings.