Problems at Home?
Seems everyday we read about some new broadcaster or video content provider announcing big plans to make content available over the Internet or their broadband provider partners’ network, giving consumers a plethora (yeah we know what it means...we looked it up on dictionary.com) of new digital entertainment services.
But what you DON'T read about is all the problems in getting this done. U.S. carriers, for instance, are arguably behind (relative to the rest of the world) in delivering IP-based digital TV (IPTV). Here are some ugly factoids:
- Local loops in North Amercia(the distance between homes and the nearest carrier central office) are typically much longer, making it much more difficult to provide the access bandwidth necessary for video services
- The U.S.has now fallen to 12th in the world in broadband connectivity per capita, more than half of the American population don't even have broadband yet
- Less than 9% of U.S.households have a network at home.
- Compelling new content and services, enough to make subscribers change, hasn’t yet been developed
Check out this great piece that looks at the IPTV regulatory environment in the
Many of the reasons behind the U.S.lag time in these areas have nothing to do with technology. We have it and know how to get it to the consumer. Many believe that the problem centers more on the government’s desire to over regulate and our inability to create compelling content that drives consumers to brow-beat Washington, D.C. into submission. Maybe. Maybe not.
But most analysts will tell you that one of the biggest (if not THE biggest) obstacle inhibiting the mass deployment of so-called “triple play” (voice, video and data over a single IP connection) is finding a way for consumers to distribute this new multimedia content around their homes.
The problem is that these services now come into the home over the DSL or broadband connection, typically located in the basement or office and is never near to TVs and other A/V devices. IPTV providers in Hong Kong and Italy (two of the world's largest markets for the new service-and THEY should know cuz they're offering services right now to hundreds of thousands of broadband users) both say that the rejection rate of the new service (i.e. people who send away the installer) can be as high as 20 to 30 percent as soon as the consumers find out they have to have wires installed.
Basically, as an industry, we haven’t made it simple or compelling enough for consumers to install a home network. Most people have a voice line coming into their home, a coaxial cable connection for TV signals, a broadband DSL line (if they aren’t getting Internet over cable) and a Wi-Fi network for data applications. That’s four different in-home networks they must pay for and keep going.
So what do consumers have to do to get these great new services (sarcasm implied)? Sometimes they pay the carrier to wire Ethernet or coaxial cabling around their homes which, according to providers, typically costs a few hundred dollars and takes around four to six hours. Sometimes the service providers have to eat the cabling costs in order to increase penetration of their new IPTV service. Sometimes, (if the IPTV service offers really compelling content that consumers cannot live without) the consumers just put up with ugly exposed wiring. Better ways are becoming available now, such as IP over home power lines and multimedia over Wi-Fi but even those technologies have their problems.
We’ll explore that next.
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