MICROSOFT: IPTV ISN'T SLOWING

Microsoft last week defended progress of the IPTV market overall and its own IPTV developments after reports surfaced that Telstra has opted not to move forward with a trial using the vendor's platform.

The vendor had been in discussions with the Australian carrier about using the Microsoft TV IPTV Edition, but Telstra was not a member of its early-adopter program, according to Ed Graczyk, director of marketing for Microsoft TV.

Early in the week, numerous press reports claimed that the company was halting a trial, but Graczyk said the carrier wasn't that far along.

“We were talking with them about this, and they decided not to do it,” he said. “They've gone through some pain to explain this wasn't a problem with the Microsoft software but more to do with their internal preparedness. They're still very encouraged about the platform. From our perspective, it's our business to lose.”

The reports on Telstra, however, fueled speculation that the entire IPTV market was taking a breather, with several analysts noting that Swisscom and SBC Communications — both members of Microsoft's early-adopter program — had adjusted their deployment timelines. In a mid-week research note, Herve Utheza, director of IPTV Research and senior analyst for The Diffusion Group, criticized SBC's decision to use Microsoft because it would give the software giant too much power. Competitors also seized the opportunity to criticize Microsoft's platform.

Brian Baker, president and CEO of video security vendor Widevine, said purported delays reflect on Microsoft's ability to deliver and the telco's recognition that using the platform is risky.

“What these operators are looking to do is create price competition among vendors,” he said. “If you're using a content security solution that has a vested interest in all the components, that creates a conflict.”

Graczyk, though, said Swisscom slowed its rollout because of the availability of its chosen set-top boxes and that SBC hasn't deviated from its promise to deploy by the end of the year. Moreover, it has only been 18 months since Microsoft Chairman Bill Gates announced at Telecom 2003 the company's intention to get into the market.

“The real interesting story is how quickly this thing has gone from ground zero to what will be commercial deployments,” Graczyk said. “It's amazing when you contrast that to video-on-demand and cable when the first trials were in 1990 in Orlando, and the first deployment wasn't until last year.”