Special Report
Opportunities & challenges
of IPTV in Europe
By DR GLODINA CONNAN-LOSTANLEN, business development
eventually the business will grow to
manager IPTV & Mobile TV, Harris Broadcast
encompass advanced or interactive
Communications, EMEA.
advertising models.
However before European IPTV service
W
hile IPTV is a still a relatively leading IPTV services providers can procure and expand
new entertainment distribution in the world are advertising revenue, there are significant
platform, we at Harris believe based in France: challenges they must first face and overcome
that this market has enormous Free, which has one if they want to compete for increasingly
growth potential, particularly in Europe. million subscribers; budget-conscious advertisers and advertising
‘The IPTV Global Forecast for 2007 to Orange France spend.
2011’ by MRG Research, Inc., re-enforces this Telecom with These start-up services must compete
potential for growth when it states: "Europe 1,250,000 head-to-head against established, traditional
is leading the world in the deployment of subscribers; and Neuf media, such as broadcast television, satellite
IPTV services. IPTV is a commercial reality in Cegetel with 900,000 and cable TV service providers - all of which
Europe." It goes on to say: "The IPTV subscribers. Deutsche want a slice of the advertising pie. While the
activities in Europe are quite robust and will Telekom (DT) in most prominent television broadcast
keep Europe as the leading region in terms of Germany and British companies in the market may reach millions
Dr Glodina Connan-
IPTV deployment through 2011." Telecom (BT) in the of viewers from their TV transmitter towers,
Lostanlen.
The MRG reports also claims that global UK are just beginning fledgling IPTV service providers may only be
IPTV service revenue, which was $3.7 billion to catch up as of this year. able to offer advertisers access to hundreds
(USD) in 2007, is projected to grow to $23.2 or thousands of subscribers.
billion by 2011. And Europe, which saw $1.5 Meeting challenges head-on Another challenge is that most IPTV
billion in service revenue in 2007, should operators are new to the process of selling
grow to $8 billion by 2011. Also, the At present, European IPTV service and managing television advertising. So to
European IPTV subscriber count, which was providers rely primarily on subscriber make their business propositions more
6.7 million in 2007, is forecast to reach 30.4 revenue, but in the near future, we anticipate attractive, many will likely leapfrog the
million subscribers by 2011, compared to just this picture will expand to encompass conventional TV ad model altogether and
11.7 million IPTV subscribers in North revenue from advertising. Initially, the IPTV offer advanced advertising that is targeted
America by 2011. industry in Europe will see advertising based and interactive.
The MRG report indicates that the three on traditional, linear advertising, but Because of unique capabilities inherent in
The Harris G-Series.
the IP technology platform, they can even
deliver a specific ad to a single, targeted
viewer based upon demographic or consumer
profiling. This helps differentiate IPTV from
other competing distribution channels, most
of which will be primarily linear mediums.
And advertisers and advertising agencies
consider interactive advertising to be
desirable even when this is to a
comparatively smaller audience.
Three-phase model
Before European IPTV operators can fully
realise their advertising potential, they need
to build a strong foundation - not only with
respect to their physical infrastructures but
also the business models they develop and
employ.
At Harris, we envisage a three-phase
guide2iptv iptv 26 september 2008
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