YouTube effect changes IPTV plans

A few thousand carriers and vendors graced the TelcoTV conference and expo earlier this month, and although YouTube wasn't among them, the online network of user-generated video was easily the hottest topic of conversation at the event.

Google's $1.65 billion acquisition of YouTube, announced last month and completed last week, obviously has something to do with that. But unlike the investment community, the telecom industry's IPTV advocates are not combing the Internet to find the next YouTube. Instead, they are trying to figure out the best possible way to package and present YouTube-like content to IPTV consumers likely to be keen on personalization.

That includes avoiding walled garden IPTV content strategies, said panelists at the TelcoTV panel “MeTV: Exploring the true power of IPTV.”

“Controlling and distributing video is the hard part of this,” said Lee Friedman, director of IPTV applications for BellSouth. “There are gobs of video content out there, but no good way to navigate it. How will we take what we learned doing broadband on the Web and bring it to TV. Cable is very closed and very limited, and what we have to do is make it more like the Web — open.”

On the same panel, Jeff Weber, vice president of product and strategy for AT&T operations, told a story about talking to a prospective content partner “about televising polo. I realized I forgot to ask whether he meant water polo or the kind with horses, but it doesn't matter which because they both have audiences that we need to cater to.”

That doesn't necessarily mean partnering with a network that only provides polo programming, however. It more likely means that IPTV providers such as AT&T will have to provide consumers with all the means to find and subscribe to content that fits their interest, no matter how obscure they are or where that content lies.

“Talking about 500 channels versus 200 channels at this point is a waste of oxygen,” he said. “The long-tail effect brings a wider array of content to our customers, which is a huge advantage for us. We are very focused on building out our infrastructure, but we are equally focused on content.”

Yet, the methods by which AT&T and other carriers will allow their users to latch onto the long tail remain to be seen. Derek Kuhn, senior director of strategic solutions for Alcatel, noted during the same panel that intelligent search functions could be integrated with user programming guides to provide access to both IPTV content and online video content.

However, in an earlier panel on the same stage, another group of industry experts discussed — with no consensus — how such programming guides will be branded and who will be in control of how content is presented.

Mike Hudack, CEO of blip.tv, said telcos should control and brand the menu of services. However, Internet companies like Google are also positioning themselves as online video guide, and other content firms and even manufacturers of TVs, digital video recorders and set-top boxes want to wield their influence.

Personalization also changes how content can be priced and potentially where telcos can realize their revenue. If users pick and choose content from different sites and sources, telcos may have to find a way to charge a processing fee on each content transaction.

Trey Gaskins, chief operating officer for Dave.TV, said the uncertainties of how to integrate a wide variety of content might leave telcos pursuing walled garden strategies in the short term. “Ringtones are a huge, multi-million dollar business because carriers didn't open it up. For the foreseeable future, a walled-garden approach can protect their investment,” he said.

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