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Consumer Personalization Differentiates IPTV

Telephony reports that this year is shaping up to be a key year for IPTV. Verizon and AT&T are launching IPTV services. In Europe, BT is launching and France Telecom is seeing take-up of its offerings. These aren't telcos' first forays into TV, nor their first attempts at content. The earlier moves generally have not been successful, so how can telcos succeed at offering IPTV services?

There is a clear indication from consumers that they want a TV experience that is more flexible than current Pay TV and Free-to-Air TV options. CSMG ADVENTIS research indicates that consumers are dissatisfied with their current TV experience: more than 50 percent of consumers miss more than one program per week, while 85 percent frequently find there is nothing on TV they want to watch.

In addition, success of digital video recorders also points to interest in a flexible TV viewing experience. Overall U.S. DVR penetration is now 6.5 percent, and 17 percent of DirecTV�s subscribers use DirecTV DVRs.

Leveraging advances in technology, telcos that offer broadband are aiming to meet this demand by offering IPTV services. Now that cable operators are offering voice services, many telcos feel they have no choice -- they must offer TV services to survive. While the definition of IPTV varies, it typically includes a mix of traditional broadcast TV, on-demand TV and other content and applications.

Despite demand for new TV services as well as improvements to technology and costs, telcos face a number of challenges in IPTV. Competition for TV viewers is fierce -- there is a real risk that telcos will become competitively squeezed between incumbent pay-TV operators moving to meet the demand for new TV services and online players such as Yahoo and Google.

As PCCW has already proven, a-la-carte channel selection and other modes of consumer personalization will help to differentiate IPTV, and dramatically increase market penetration.

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