IP Summit Keynote: IPTV has great potential

CHICAGO--Television will change more in the next five years than it has in the past 50, according to Christine Heckart, general manager of marketing for Microsoft TV, who gave a lunchtime keynote address today at Telephony’s IP Summit, held in conjunction with Globalcomm 2006.

Heckart said TV today remains unconnected and has been left behind by the digital revolution, but IP will revolutionize TV in much the same way IP connectivity forever changed the way people use personal computers.

“We’ve become an on-demand world, but TV isn’t keeping up with that,” Heckart said, citing the example of the Live 8 concerts held simultaneously around the world last July. More people watched those performances over their PCs--and after the fact--than watched them on TV.

Although many in the telecom industry might see TV as a dying or stagnant technology, Heckart says telcos can help evolve TV and even profit from it, and they don’t need to erode their prices to do it. Microsoft research shows carriers can capture 13% of the market if they enter the space with a competitive offer, and they can grow the overall TV market by shifting prices up to $35 average revenue per user, per year. Heckart said the research shows service providers can drive 20% share and retain ARPU of about $60 per subscriber annually if they market their features instead of cost, much the same as cable companies have done over the past 10 years.

There are three rules telcos must keep in mind to allow IPTV to reach its full potential, she said. They must think big and maintain their community, commerce and content vision, making it possible for people to use multiple applications at once.

The second rule is to start small, get the essentials right, upgrade and maintain the networks to where they need to be to support the technology. “We have to start small, then we can innovate,” she said. “This is the year for getting the basics right.”

The last rule is to move fast, strive for vision and change the rules. “You have to be able to let the industry try and fail,” she said. Only then will the industry be able to see what works.

Above all, she said, telcos must not lose sight of the fact that the killer app for TV is TV. “It’s about great, interactive TV experiences.”