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How PCCW Became the IPTV Benchmark

Following several months of investigative research, and diligently reading numerous IPTV-related market studies, I wrote several columns for the summer issue of Broadband 2.0 magazine. Not all columns are posted online, therefore the print version is the most complete. In the Global Watch section of the publication, I wrote a sidebar detailing the ascent of the world's undisputed IPTV service deployment leader, PCCW. Anyway, here it is, for your consideration.
When Pacific Century CyberWorks (PCCW), the parent company of Hong Kong Telecom (HKT), entered the pay-TV market in September 2003, the provider faced competition from broadband service rivals such as Hong Kong Broadband Network (HKBN) and Hutchinson Global Communications (HGC), as well as iCable, the incumbent pay-TV provider.

To clearly differentiate its offering, PCCW introduced its IPTV service, branded "now TV", with a flexible pricing structure. Customers pay only for the channels they choose, a model often referred to as "� la carte." The company also provides free set-top boxes to subscribers. PCCW�s service includes more than 23 channels available to residential pay-TV customers, and more than 60 additional channels, plus a variety of video-on-demand (VoD) content that is available exclusively to its broadband subscribers.

In an effort to increase the revenue per user, PCCW also introduced "minipack" subscriptions which enable broadband pay-TV customers to select a number of their favorite channels as a package for a discounted monthly subscription fee. By November 2005, PCCW reported that the service had surpassed 500,000 subscribers � the highest market penetration in the world by an IPTV provider.

PCCW subscribers receive a unique mix of local, regional and international programming. For example, the service includes an exclusive broadcast of ESPN and STAR Sports, a line-up of domestic programs that includes ATV news and STAR Chinese movies, as well as commentary in both Cantonese and English.

To broaden its addressable market, PCCW created a business-oriented service which is widely available in hotel rooms and a multitude of hospitality outlets. For corporate customers, PCCW offers a mix of business-related content, including local, regional and international news, financial analysis and various sports programs.

Looking ahead, PCCW is preparing to introduce a network-based video recorder (NVR) that will offer residential customers the benefits of advanced VoD service. In addition, the company recently announced that it will extend its IPTV service through its newly acquired �Sunday� mobile business unit to create what they intend to be the world�s first �quadruple-play� service offering.

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