Copper-wire couch potatoes?: ImagicTV lets telcos turn IP networks to broadcast-and turn a profit

Telcos looking for new revenue streams may want to take a page from the book now being written by New Brunswick Telephone. Chapter One: Start delivering cable TV and high-speed Internet access over your existing copper network.

The vehicle for doing this comes from ImagicTV, a one-product company with investments from NBTel, Newbridge Networks and a venture capital group. ImagicTV produces what it calls "telco-ready" software that will allow service providers to carry digital broadcast television to residential or business subscribers over digital subscriber line (DSL), fiber-to-the-curb or wireless broadband networks.

ImagicTV was born of NBTel's push to promote electronic commerce in its eastern Canadian market. To do that, the telco had to upgrade its network to provide high-speed Internet access, said Peter Jollymore, NBTel's vice president of planning and marketing. "The only way to make the business case for that work was to develop multiple services over a common infrastructure-TV and Internet access as well as telephony."

But bringing TV over an Internet protocol network is just the beginning, said ImagicTV President-and NBTel alumnus-Marcel LeBrun. "Lots of companies can stream video over copper or IP," he said. Asymmetrical DSL "was developed to deliver video after coaxial cable proved uneconomical. But what was missing was the answer to the question, 'Can we make money with ADSL?'"

There's no business case for high-speed service to the home if a service provider is going to deliver only Internet service or cable TV, LeBrun said. "But if you use the high-speed infrastructure to deliver multiple services, you've justified your cost. We complete the service bundle that permits that high-speed deployment."

ImagicTV's proprietary software delivers digital television along with capabilities for pay-per-view programming, video-on-demand and Internet access. Assuming the IP access network is in place, a service provider licenses the TV channels it wants to offer, builds a cable headend to receive and digitize video signals, deploys set-top boxes in consumer homes and begins broadcasting. All the business and broadcast management rules that control the delivery of video are contained in the ImagicTV software-including the provisioning system, administrative and billing functions, and the capacity to profile customers.

The ImagicTV viewer experience comes through a remote control or an optional keyboard. Users get an electronic program guide that can bookmark and recall their favorite channels on a given night of the week. While the broadcast content can be viewed over a multimedia PC, viewers can also browse the Internet using their TVs, getting Web access on Channel 5, for example, and e-mail on Channel 99. If they wish, viewers can watch TV on a multimedia PC, and a home collector box can enable both a TV and a PC.

To subscribe to a channel, viewers click on it and answer "yes" when an on-screen question asks if they want to subscribe. Depending on the service provider's rules at set-up, viewers may unsubscribe the next day and be billed for 24 hours of access to that channel.

"We already know from the telephony world that if you put something on people's phones and just charge them for use, rather than forcing them to subscribe, then usage goes way up," said LeBrun.

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