IPTV: where is the service differentiation?
Other than the integration issues that IPTV operators often stumble upon, being able to differentiate their service is a major challenge. IPTV is in its infancy and it has to work much harder to shake the equilibrium in the pay-TV services market dominated by the traditional broadcast mechanisms, the cable and satellite. So far IPTV has not been able to offer anything new to the end users who are essentially technology agnostic. They want a TV service. And wherefrom that comes, hardly matters.
All the IPTV deployments are in early stages and the operators are keeping the services simple. Another issue is, though we can potentially have very innovative and differentiated services over IPTV, the operators are only willing to offer such services once they reach a certain scale. This critical scale is supposed to be around 5 million subscribers market. Even France Telecom, the largest IPTV provider is far behind this number at the moment.
An option would be to deliver new and exclusive content over the network. This is not easy either. Content owners have been working closely with the alternative operators and with the current scale of IPTV deployments you cannot expect them to provide exclusive rights of distribution and telecast to an IPTV operator. At the same time small IPTV operators don’t have the purchasing power to buy content/event worth millions.
Seems like the chicken and egg kind of situation.
