"...the entry of big telcos into the IP Triple Play market using
IPTV will make it a must-have feature for any major provider
of broadband services. However, offers will need to be well
thought-out and innovative to attract customers, and must
take full advantage of the greater flexibility inherent in a TV
proposition based around broadband and IP"
January 2007, Graham Finnie, Senior Analyst, Heavy Reading
The different IPTV strategies pursued by operators are
clearly influenced by a number of factors. If they see IPTV’s
best role as churn prevention and broadband customer
acquisition, then aggressive pricing on similar services that
are already in the market might be the best bet.That is, to
compete on things that customers already understand —
such as speed and price — while at least matching the TV
experience offered by the cable operators. If extra revenue
per customer is the priority, then greater emphasis on
interactive services and pay-TV (exclusive content, perhaps)
might be the best IPTV approach, although more risky and
The mar
.
more costl
greater functionality that IPTV provides compared with
cable TV.
Telecommunications Magazine, September 2006
y
keting push here would be on the
2 | IP Triple Play Solutions Guide
Executive Summary
Delivering Global Solutions
Allied Telesis has fused the worlds of IP/Ethernet and Carrier-
class access technologies to create a truly comprehensive range
of solutions for IP Triple Play Service Providers. All the hallmarks
of the Allied Telesis portfolio of solutions are to be found in
these industry-leading, global internetworking solutions which
span across a wide range of solutions and market segments
including Carriers, Network Service Providers, System Integrators
and Post,Telegraph and Telephone administrations (PTTs)
worldwide. These solutions include: Carrier-class integrated iMAP
Gateways†, iBG intelligent Business Gateways and the
Provisioning and Management systems: Zero Touch Configurator
(ZTC) and Network Management Software (NMS).
The Challenge Facing Today’s Revenues
Today’s network service providers are faced with on going
pressure to maximize profitability. Revenues from traditional
services (i.e. voice and data) are on the decline as competition
is encroaching on established Operators and Service Providers.
Furthermore, a plain ‘vanilla’ Broadband offering is no longer a
business opportunity and is quickly becoming a commoditized
offering with little or no margin to the Providers. One logical
approach for addressing the margin erosion and revenue
pressures is to generate additional sources of revenue through
new innovative service offerings. These new ser vices need to be
added whilst getting the most from existing infrastructure as
ell as lev
w
that many Providers and System Integrators (SI) are now
focusing attention on is interactive entertainment services.
Broadcast video
(VoD) are just a few of the high-value services that Operators
and System Integrators can provide. Combined with high-speed
Inter
Play’ of voice, video and data can be bundled together in
attractive service packages to significantly improve Providers’
rev
eraging telecom de-regulation frameworks. One area
Pay-Per-View (PPV) and Video-on-Demand
,
net access and traditional voice services, a potent ‘Triple
enues and profits.
he whole is greater than the sum of individual parts
T
The bundled package of services is intended to return more
benefits to end-customers by offering a more affordable service
tariff than the aggregation of charges for individual services.
‘Bundling’ Services
The advantages of ‘bundling’ services have been proven by
traditional cable TV Operators who also offer packaged voice,
video and data services. These Operators have demonstrated
that average revenues per subscriber can be increased and
customer churn can be reduced by service bundling.The
traditional local exchange Carrier or competitive operator can
also realize these benefits by offering their own service bundles.
Recent technology advancements now enable these traditional
wireline Service Providers to offer a ‘Triple Play’ package of
voice, video and data services using either fiber optic or voice-
grade copper facilities. Moreover, emerging Operators from
different industries and sectors such as utilities, hospitalities,
municipalities and housing associations can leverage their
lished infrastructure and customer relationship to offer
estab
advanced innovative services at a more competitive price-
performance point than previously achieved.
Bundling services creates the ‘Halo Effect‡’ with subscribers and
end-customers.
‘stickiness’ and encourages uptake of other service offerings
vailable from the provider.
a
†
mer
or
iMG f
‡
‘Halo Effect’ describes the effect that a positive experience with one aspect of a
The
vice infers about other aspects of a service .The perception is that the overall service is
ser
better than the sum of the individual par
This effect incr
erred to as the ‘Residential Gateway’ or ‘RG’.
y ref
l
eases their lo
ts.
yalty, creates more
IP Triple Play Solutions Guide | 3
The Changing Landscape
Technology and economics advancements in DSL technology
have been the primary enabler of IP Triple Play service
packaging among PTTs and alternative Carriers, due to the
ability to offer high bandwidth over existing copper facilities. In
many countries, these facilities have been ‘opened-up’ unbundled - for competitive use allowing alternative Carriers to
access these subscriber lines as well. With DSL ser vices like
ADSL2+ (Asymmetrical Digital Subscriber Line) providing high
bandwidth access at speeds of up to 26Mbps and VDSL2
providing up to 100Mbps today, it is now possible to provide a
high quality, high definition, video service to multiple TV sets
while simultaneously providing high-speed Internet access and
several telephone lines over a single copper loop. By utilizing
this ‘fixed investment’, these Operators can dramatically improve
profitability, increasing revenues per loop by up to four times
their current revenue.
Video compression technology, a key component of IP Triple
Play, has also improved dramatically over recent years. The
MPEG-2 (Motion Picture Engineer Group 2) standard has been
deployed globally for video compression applications.Video
compression technology is developing and advancing quickly
with the introduction of techniques like MPEG-4 and Windows
Media 9 that are far more efficient and require much less
bandwidth. Soon, Carriers and Service Providers will be able to
stream high quality video at less than 1Mbps.These technologies
will be crucial in the deployment of high bandwidth services
Television (HDTV). Also, the availability
such as High Def
of proven and well-established interactive video platforms
combined with the emergence of video content aggregators
and brok
content.
The Customer Premise Equipment (CPE) pla
role in the delivery of IP Triple Play services. As traditional
broadband CPE devices such as modems and home routers
cannot suppor
er
inition
s is beginning to facilitate access to IP-based video
ys a fundamental
t these new services, Operators will need access
to ‘intelligent’ Multiservice Gateway devices in order to enable
IP Triple Play delivery to customer premises.To be competitive,
the total cost per end-customer connection m
minimum.The price performance ratio for the CPE device is the
key to validating the business model of Service Providers and
Operators. The economies of scale provided by the adoption of
Ethernet technology have helped to pave the way to the ‘right’
price point for the new advanced IP Triple Play ready CPE
devices, proving the business case for the provider.