Watch out for the coming video explosion

As part of the volunteer work I do as a program producer and director for the local public access cable TV channel, I have been investigating alternate technologies for broadcasting TV programs. As a result, I have come to believe that we are about to see a widespread revolution in video transmission and content generation. The drivers for this sea change will not come from the cable TV giants and the telco behemoths, although those groups will certainly have major parts to play in the coming revolution.

No, in my view, the drivers of this revolution are likely to be several new faces, some tiny and potentially cash-strapped, and some larger and financially healthy because of recent significant infusions of venture capital or investments by media giants. There is one common thread linking these newcomers and that goes by the acronym, IPTV. No doubt you will have surmised that IP stands for “internet protocol,” and TV, of course, is “television.” So far, so good.

But, just what is IPTV? The simplest definition is “broadcast-quality television signals that are delivered to viewers using a broadband Internet connection.” Currently, this definition does not necessarily mean streaming TV signals continuously over the Internet but rather the delivery of programs that the viewer requests that are downloaded to a digital video recorder (DVR) for later viewing. Not only can the subscriber to such a service specify exactly the programs he or she wants to watch, but they can be seen at any time, in any order, and as often as desired.

The leader of the pack of novice IPTV service providers appears to be Akimbo Systems (www.akimbo.com) based in San Mateo, CA. For a monthly fee of only $9.95, Akimbo offers its subscribers programs from the BBC and other highly reputable sources that can be downloaded to a Windows Media Center PC (but not yet to an Apple Macintosh) or to a proprietary TV set-top box that costs less than $70 and can store some 150 hours of programming for viewing on a conventional TV set. Backed by such Bay-area venture-capital biggies as Kleiner Perkins and Draper Fisher, Akimbo is an early starter in the field, while other newcomers are only at the beta test stage.

And there are already growing numbers of early-adopter IPTV viewers around the world. According to the Multimedia Research Group, in 2005 there were 3.7 million IPTV subscribers worldwide, a figure expected to grow to 36.9 million in 2009. The same report predicts that subscriber revenues will grow from a piddling $880 million in 2005 to a whopping $9.9 billion in 2009. Now you begin to see why the venture capitalists are so interested in finding investment plays in the IPTV field.

For these and other numbers in this column, I am indebted to the editors of IPTV Information (www.iptvinformation.net), an electronic newsletter. The newsletter claims that there are IPTV ventures in Europe, too, notably FastWeb in Italy, HomeChoice in England, MaLigne in France, and Telefonica in Spain. In the U.S., several startups are planning to offer IPTV services, such as DaveTV (Atlanta, GA), Brightcove (Cambridge, MA), Magnify Media (New York, NY), and Veoh Networks (San Diego, CA). If you do a Google search on these companies you will get some idea of the frantic activity in this area.

What makes IPTV technically possible and commercially feasible is the rapid growth in bandwidth of Internet services. Telco Verizon, which has been furiously installing fiber-optic cable to homes here in suburban towns in New England, has announced a 30‑Mbit/s service, albeit at the extraordinarily high price of $180/month. Cablevision is also introducing a 50-Mbit/s internet service, although there were no details on the pricing at press time. This bandwidth and the recent developments in digital signal-compression techniques make the downloading of video files much faster today than a few years ago.

As I write this column, workers are tearing down several vintage Boston skyscrapers, and, in general, replacing them with glass and steel edifices that artfully conceal the miles of fiberoptic cable that will be crucial to the success of IPTV services. Business is gearing up for the explosion. Are you going to be ready for the coming video revolution?