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IPTV Service Providers Reach a Major Crossroads

IPTV network operators face a complex array of issues and challenges as they scale their networks to deliver services to a wider group of customers. Those challenges aren't limited solely to subscriber headcount, according to the latest market study by Heavy Reading.

"IPTV is at an exciting stage in its development, with subscriber numbers growing at a fast pace around the world," notes Simon Sherrington, research analyst with Heavy Reading.

"But even during this time of opportunity, the industry faces significant challenges related to what can broadly be described as scaling -- IPTV services and systems are scaling up in multiple ways, including not only more subscribers, but also more data, more devices, more interactivity and more content."

Demand for HD content and multi-screen delivery, the overwhelming quantity of content that must be delivered efficiently and discovered by the user, and the need to respond to competition from OTT video content -- as well as to cable operators' increasingly sophisticated services -- are all affecting telco efforts to scale IPTV services, Sherrington says.

"Vendors need to help their telco customers in many ways, pushing along multiple axes of the scaling challenge and opening up their systems to third parties to help in the development of new services in which managed IPTV is likely to become just one part of an even more complex TV and video delivery service," he adds.

IPTV service providers have reached a significant crossroads. Will they choose to open their closed walled-garden platforms to independent TV app developers, or will they stay on their current course?

Key findings of the market study include:

- Vendors are evolving their systems in several ways, from handling IPTV and video traffic at lower layers in the network to opening up middleware to innovative third-party apps.

- The IPTV service layer can cope with HD and 3DTV content, although 3D is two years away from being significant.

- Efficient technical and commercial models for multi-screen TV services have not yet emerged.

- The processing power of set-top boxes will soon approach that of PCs, and will handle hybrid managed and OTT content in an integrated way.

- Intelligent content discovery and recommendation engines are increasingly important to enhance the user experience.

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