Helping the world communicate
Telecom Sector on the Edge:
Driving the Future of IPTV
The Future of Voice
www.itu.int/spu/voice
15-16 January 2007
ITU Headquarters
Geneva, Switzerland
Jaroslaw K. Ponder
Policy Analyst
ITU Strategy and Policy Unit
International
Telecommunication
Union
The views expressed in this presentation are those of the author and do not necessarily reflect the opinions of the ITU or its Membership.
Helping the world communicate
Starting points
 Migration to
the IP-environment
 Convergence
of three
worlds
 Evolving
regulatory
Internet
environment
15-16 January 2007 / The Future of Voice / Geneva
 Socio-economic
development
 Investment
 Innovation
Telecom
Broadc.
 Catch-up
 Ongoing
regulatory r.
 Competitivness
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Monopoly
Competition
Narrowband
Broadband
Traditional
networks
NGNs
Telecoms
Telecoms/IT
Convergence
Wireline
Wireless
Convergence
Voice
Data / Video
Triple Play
National
Global
Pasive
Interactivity
General
Personalised
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Ubiquitous,
personalized and
interactive service
Video
Services
Telco Sector
Telecom and Broadcasting
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Three Times VoIP
Video over IP
Voice over IP
•IPTV (QoS)
•VoD
•Interactive MS
•Web TV
•Mobile TV
•VoIP / PSTN
•IP Telephony
•VoB
•VPN
Mobile and Wireless
Fixed Infrastructure
•2G, 3G, 4G
•WiFi
•WiMAX (d,e)
•Satelite
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Velocity on IP
•xDSL
•FTTx
•Cable TV
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Broadband Access, 2005
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Source: ITU (2006), World Information Society Report 2006, www.itu.int/wisr
Helping the world communicate
Telecom Sector in Transition
Broadband/Mobility
Now
Service A
Service B
Service C
Net. A
Net. B
Net. C
NGN
VoIP
Fixed: PSTN
Mobile: 2G
QoS
USO
Reg. Int.
Simulation
Emulation
Multimedia
Generalized mobility
Convergence
Integrity
Multi-layer orientation
Open character
Next Generation Services
QoS, Mobility, Interactivity,
Personalization, N-play
IP-environment
Future
Services A, B, C
IP Platform
(QoS)
Access Networks
Interconnection / Emerging markets / Universal services / Competition
Numbering / Quality of Services / Emergency Access / Consumer Protection
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Converging Markets
Broadca
sting/
Satelite
Fixed
Telec.
CableTV
Mobile
Telec.
Wire
less
Infr.
less
s. prov.
Voice
Internet
Television/
Radio
Services on
Demand
(VoD…)
Note:
historically, the main service provided over the access platform
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NGN Considerations…
 NGN will lead to re-monopolization in the
telecommunication sector?
 Less Bottlenecks / New bottlenecks
 Dynamic efficiencies
 Competition?
 NGN as an effect of competition
 NGN enhances level of competition
 New interconnection regime?
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Helping the world communicate
NGN Considerations…
 NGN will enable structural separation?
 Networks / Services / Applications
 Voice loses meaning?
 Tech: IP protocol
 Business: Voice plus Content
 Present regulatory framework remains
relevant?
 Evolution is unavoidable
 Convergence (T+B+C)
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New challenge for telecom sector
 Driving the Future of IPTV
 Chairman Report from
Executive Round Table
 Market, Regulatory Trends and
Policy Options in Europe
 Market, Regulatory Trends and
Policy Options in Asia / Pacific
 IPTV Global Technical Workshop
 12-13 October 2006 / www.iptv-ws.com
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IPTV: Implications
 Infrastructure requirements
Margin
Revenues
 6-16 MBit/s for HDTV / Narrow Band TV
 Bandwidth / Generalized mobility
 ADSL2+/VDSL/FTTx/3G/4G/WiFi/WiMAX
 Standardization process (Arch., STB)
 Compression Methods
 Business Model
Users
 Value Creation Chain / True margin
redistribution
 Triple-play
 Distribution platforms /Interaction
 Broadcasting /One way communication
 Regulatory reform
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IPTV: Market Trends
 Beijing RIC Information Consulting
(2005): Global
 2006: the global revenue of IPTV service 
$8 billion with over 8 million subscribers.
 Users: 2004: 2.19 million  2008: 20.44
million
 21st Century Communications World
Forum :
IPTV Users in Europe
 2006: 2-3 Million U.
 Gartner (2006): Europe
 2006: 3.3 million users
 2010: more than 16 Million Users
Source: Gartner (2006)
 Additional revenues generated
will
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15-16 January 2007 / The Future of Voice / Geneva
grow from 336 Million to 3 Billion
Helping the world communicate
Case Study on Hong Kong: PCCW
Strong Demand for
Residential
Installed
Pay channel customers
608
Commercial
26
549
Installed pay
channel services
22
(’000)
441
444
17
Reached
654,000
Pay Channel Customers & ARPU
26
391
361
22
100%
10
at end of August
269
Pay channel
customers
Mini Packs
as % of total
launched
installed
105
271
70
17
418
192
147
57
(HK$/ month)
110
61%
114 118
120
71% 73%90
60
39%
369
10
53%
Steadily rising
ARPU as new
content introduced
20%
30
254
182
106
0%
29
H2
2003
H2
H1
H2
2004
H1
H2
2005
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H1
2003
0
H1
H2
2004
H1
H2
2005
H1
2006
2006
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Source: ITU-T IPTV Global Workshop, KT Case Study, Mr Berriman
Helping the world communicate
Case Study on Hong Kong: PCCW
Growing penetration rate of
among
consumer NETVIGATOR
Broadband Lines
(’000)
Wholesale
Business
Consumer
703
953
753
796
53%
59%
48%
857
94
28%
88
80
629
74
63
68%
998
H2’03
H1’04
H2’04
H1’05
68
58
798
840
Maintained low churn rate of consumer
NETVIGATOR since
launch
715
660
558
Dropped by half
517
460
H1
H2
2003
H1
H2
2004
H1
H2
2005
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H1
2006
Before launch
Jun-05
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Source: ITU-T IPTV Global Workshop, KT Case Study, Mr Berriman
Helping the world communicate
IPTV: Drivers and Obstacles
Drivers
 Telecom competition
 Inter-modal comp.
 Pricing and sell
strategies
 Broadband
deployment
 Content providers
 New ubiquitous
distribution platform
 Convergence
 Bundling strategies
 User
 Switching behavior
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Obstacles
 Regulatory
environment
 Standardization
process
 Margin redistribution
 New form of service
 Interactivity
 User
 Cost of the STB /
Hardware providers /
Operators
 Willingness to migrate
 Willingness to pay for:
TV Services / Video
on Demand / Next
generation
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 Consumer protection
Helping the world communicate
IPTV: Regulatory considerations
IPTV
Policy/Regulatory Goals
 Socio-economic goals
 Application and service
 New markets
 Investment
 Fosters competition
 Innovation
 New architecture and
bottlenecks
Regulatory Focus
 New cost models
 Static and dynamic
 Market analysis
efficiences
 Cross-subsidies
 Monopolistic bottlenecks
 Boundaries between
 Market failures
infrastructure and the
 Ex-post r. v. ex-ante r.
content
 Cross-ownerships
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Helping the world communicate
IPTV regulatory requirements
 Infrastructure
 From legacy infrastructure to investment
 Inter-modal competition
 Local loop unbundling
 Interconnection
 Universal service
 Net neutrality
 Symmetric regulation
 Quality of services
 Consumer protection
 Definition of IPTV in legal systems
 IP Hybrid-service / Information service /
Broadcast service / Linear versus non-linear
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Meaningful concepts
 Neutrality
 Technological neutrality
 Net-neutrality
 Universality
 Universal service
 New platforms…
 Interoperability
 Standardization
 Asymmetric regulation
 Ex-ante versus Ex-post approaches
 Unbundling and access pricing
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Helping the world communicate
Conclusions
 All-IP environment accelerates
convergence process of telecom and
broadcasting industry
 Required strict distinction of transport and content
regulation
 Imposing old regulatory schemes to the new
technologies may weaken growth dynamics
 Regulatory forbearance will impact growth dynamics
of the IPTV market
 Institutional issues
 New dimension of regulatory reform
 Competition issues
 All-IP environment fosters competition
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Helping the world communicate
Thank you for your attention!
International
Telecommunication
Union
Jaroslaw K. Ponder
Policy Analyst
<Jaroslaw.Ponder@itu.int>
ITU Strategy and Policy Unit
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Helping the world communicate
Useful Links
 Full version of presentation:
 www.itu.int/spu/presentations
 ITU work on NGN and IPTV:
 www.itu.int/spu/ngn
 www.iptv-ws.com
 Strategy and Policy Unit:
 www.itu.int/spu
 Shaping Tomorrow’s Networks
 www.itu.int/stn
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NGN and the ITU
Regulatory considerations
 New Initiatives Programme
 What rules for IP-enabled NGNs?
 The Regulatory Environment for Future Mobile Multimedia Services
 The Future of Voice
 ITU Study Groups
 Question 6-2/1: Regulatory impact of NGNs on interconnection
 Question 12-2/1: Tariff policies, tariff models and methods of
determining the costs of services on national telecommunication
networks including NGNs
 Question 19-1/2: Strategy for migration from existing networks to
NGNs for developing countries
 WTDC 2007 in Doha
 Trends in Telecommunication Reform 2007
 Global Symposium for Regulators 2007
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Helping the world communicate
NGN and the ITU: IPTV
 IPTV Focus Group
Created in 2006 to deal with the
standardization issues related to IPTV
and link between IPTV and NGN
Meetings and first outcomes
 July 2006, Geneva, Switzerland
 October 2006, Busan, Korea
ITU Global IPTV Technical Workshop
 Regulation / Market / Technologies
 October 2006, Seoul, Korea
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Helping the world communicate
ITU New Initiatives Programme
 Focus
ICT innovations
New market developments
Emerging regulatory challenges
 Three main outcomes :
Research programmes
International expert workshops
Publications
 www.itu.int/ni
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Helping the world communicate
The Future of Voice




Research Programme
Background Materials Page
Three Background Papers
Three Regional Studies




Asia
Africa
South Eastern Europe
Latin America
 Workshop: January 2007
www.itu.int/spu/voice
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New Initiatives
Programme
www.itu.int/ni
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