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IP Capsule – July 13, 2007

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   July 13 , 2007 
IPso Facto…
 

Anticipation
The joint venture among several of the biggest U.S. cable companies and Sprint was exciting for a few weeks, when people could still entertain the notion that cable might soon thereafter field a four-Brian Santoelement bundle. But then the weeks turned to months, and the months are turning to years…

AT&T, Verizon Wireless, and other North American telcos may be rolling out video – thereby achieving the quad play, but the pace of that rollout is slow, and even when done, the footprint will leave the telco (4)bundle something less than ubiquitously available.

The marriage of wireline services and mobile services – aka fixed-mobile convergence (FMC) – isn’t going to happen before two conditions are met. The first one is more competition, and while the potential for competition is huge, there’s still precious little of it so far.

An indication that competition might be on the verge of accelerating is Motorola’s acquisition of Leapstoneprivately held Leapstone Systems Inc.

Leapstone, founded in 2001, says its Communications Convergence Engine (CCE) solutions enable service providers to package, bundle, deploy and manage a range of services. The CCE serviceBROKER integrates applications from multiple vendors and allows them to execute across multiple networks. CCE contentMANAGER provides a purportedly end-to-end solution for packaging, pricing, delivering and managing multimedia content.

Both AT&T and Verizon are Leapstone customers. They both also happen to buy set-tops from Motorola. That’s what synergy is really about, but I digress…

Companies like Motorola tend not to buy little startups like Leapstone until the little startups are on the brink of something big. That AT&T and Verizon are beginning to roll out video in earnest will trigger a competitive response from the cable companies, and the combination of telco and cable fourplay activity promises to be very big indeed. Compound that by cable companies – also frequently Motorola customers – following suit, and Motorola is sitting pretty.

Or as Sean Matthews, Motorola senior director of strategy, said, “this will provide us an engine for fixed mobile convergence.” The Leapstone products will connect various services to the back-office OSS/BSS. He called it an “intelligent service engine.”

The Leapstone tools are ready now, but the service providers aren’t. The acquisition of Leapstone, Matthews said, “is positioning to move to the triple play, the quad play, and the next play. Looking at cable operators – they’re looking to provide wireless. This will be a tool for our platform customers to enable a rich consumer experience.”

And that’s the second condition before cable operators, at least, proceed with FMC. They are bound and determined not to have a me-too product with wireless. That means they’re going to want to be able to have applications truly cross platforms. And that’s what Leapstone does.

Leapstone is hardly alone in doing what it’s doing. The interesting thing to see will be if Motorola’s timing is right.
 
Brian Santo, IP Capsule Editor & CED Magazine Editor
 
LiveFrom Cabe-Tec EXPO
 
 
 

IPTV to be a $26B business by 2011
iSuppli predicts the market for IPTV video services will rise to $26.3 billion in 2011, up from $779.2 million in 2006.

iSuppli said that does not include access to digital music, on-demand gaming, data services, home security and other services, which could tack on another $1 billion or so.

IPTV Video Revenue Forecast
Source: iSuppli Corp. July 2007

And that’s still not to mention the potential revenue from advertising and value-added TV services, maybe another $1 billion or so.

“However, to put things into perspective,” said Frank Dickson, principal analyst with iSuppli, “Comcast had 2006 pro-forma cable revenue of more than $26 billion. It is very likely that the entire worldwide IPTV industry in 2011 will not be as large as Comcast alone is.”

Dampening the glee even further is that a lot of IPTV activity will be in China.

Consumer groups and the FCC expect that competition in the U.S. is going to lead to lower prices. iSuppli agrees with those (including us) who anticipate that those expectations will be frustrated. Competition for services is likely to focus on features and benefits, rather than price, iSuppli said.

Consumers want Internet-connected TV
But that’s not all, according to the busy little beavers at iSuppli. Nearly two-thirds of consumers want their televisions to link to the Internet, which the research organization expects will propel rapid sales growth for network-enabled consumer electronics devices: DVD recorders, cable modems, digital televisions (DTVs), multi-room digital video recorders (DVRs), digital media adapters, set-top boxes and video game consoles.

Forecast of Consumer Electronics Devices
Source: iSuppli Corp. July 2007

Shipments of these network-equipped devices, along with consumer PCs and home network bridges and gateways, are expected to rise to 732.9 million units by 2011, more than triple the 225.3 million that were shipped in 2006, according to iSuppli.

IPTV, content driving FTTx market growth in 14 Asia-Pacific countries
It must be IPTV report season. Ovum RHK recently conducted 14-country assessment of broadband deployments and service drivers in the Asia-Pacific region, and has concluded there will be over 195 million broadband subscribers in Asia-Pacific by the end of 2010.

Sun servers to deliver U-verse
AT&T has tapped Sun Microsystems for servers and storage arrays to help deliver its U-verse video service. AT&T will use Sun Fire X4600 servers and will also deploy Sun Storage Tek storage arrays, the latter of which provides continuous access to AT&T’s VOD library. The new servers and storage arrays are scheduled to be rolled out in new deployments of IP-video super hub offices and IP-video hub offices in AT&T’s fiber to the curb U-verse network.

Juniper adds router for IPTV service expansion
Juniper Networks introduced a scaled down model in its E-series products aimed at routing applications in networks carrying multiple services, including data, voice, and IPTV. The E-series family of Broadband Services Router (BSRs), provides service awareness, allowing providers to develop additional sources of income through addressable and measurable advertising.

The router can support up to 64,000 individual subscribers, Juniper calculates.The E120 delivers 120 Gbps of capacity, which it claims is 50 percent greater capacity than currently shipping in competitive platforms (Juniper’s obligatory anonymous dig at rival Cisco).
 
 
 
 

Cable companies rack up top J.D. Power awards
Cable companies may be less popular than the IRS, but they’ve got a not-so-secret weapon that’s helping them improve their collective image: VoIP. When it comes to telephony services, cable operators are virtual prom queens, according to a new study by J.D. Powers and Associates.

Cable companies snagged the top honors for customer satisfaction in all six of the U.S. regions for the first time in study released on Wednesday.

For the fifth-straight year, Cox Communications’ residential telephone service was ranked the highest overall in overall customer satisfaction in the Western, Northeast and Southwest regions.

In the Mid-Atlantic Region, Cablevision ranked the highest by performing well in all six categories while Bright House Networks ranked first for the second-straight year in the Southeast Region. WideOpenWest! was included in the study for the first time and led the North Central Region with the highest ratings from customers in all six factors of overall satisfaction.

The study cited the power of the triple play bundle as one of the factors in the cable operators’ success. It found that 86 percent of the cable-based voice customers also subscribed to data services from the same provider, which topped last year’s mark of 71 percent. The importance of the bundle was also borne out by the increase in importance weight of the offerings and promotions factor, which increased 3 percent over the 2006 study.

GenBand's G6 Gateway
GenBand’s
G6 Gateway

Nortel to market its softswitches with GenBand gateways
To help customers whose phone networks are still based on legacy TDM equipment to migrate to VoIP, Nortel has elected to market its softswitches in combination with GenBand’s media gateways.

Nortel has agreed to resell, distribute, and support GenBand’s G6 Universal Media Gateway and G2 Compact Media Gateway. Nortel said the GenBand products complement the existing capabilities of its CS 1500 and CS 2000, which already migrate existing line equipment from both the Nortel DMS-100 and DMS-10.

Proxilliant gets Buford Media ready for VoIP; helps reclaim bandwidth
Following a pilot test, Buford Media will deploy Proxilliant Systems r Cable Access Management System (CAMS) throughout its systems in advance of VoIP rollouts.

Proxilliant’s Cable Access Management System (CAMS) provides comprehensive information about network and service performance, allowing cable operators to deliver VoIP and commercial services with confidence. CAMS features intelligence deployed deep into the access network that works in concert with sophisticated software in the regional head-end or central data center, allowing operators to reduce their field and network troubleshooting time and costs with precise issue identification and resolution.

In Buford’s Greenbrier, Ark., system, the CAMS System has permanently reduced the carrier-to-noise level by 12-15 dB and the expected reclaimed upstream headroom will enable the network’s transition from QPSK to 16 QAM—an effective doubling of upstream bandwidth capacity.
 
 
 
 

Ikano to resell Covad ADSL+, T1 services
Ikano Communications, a provider of private-label, wholesale, and retail Internet services, is partnering with Covad Communications Group, so that Ikano can market Covad T1 and ADSL 2+ service, in addition to ADSL service, to its more than 250 partners. As Ikano rolls out Covad ADSL 2+ and T1 services, its partners will be able to choose data speeds of up to 15.0 Mbps.

AT&T launches first metro Wi-Fi service
AT&T Inc. has completed its first Metro Wi-Fi deployment in Riverside, Calif. The service provides citywide Wi-Fi access across a 3-square-mile portion of the city. The mesh, wireless broadband Internet access network includes consumer and business solutions and a municipal public safety network for use by city agencies. Once fully built out, AT&T claims that the Metro Wi-Fi in Riverside will be the nation’s largest Wi-Fi deployment for both municipal and public use.
 

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