Executive SummaryWhile DSL TV is being introduced in some developed markets around the world, progress is very slow in Australia.
Take-up for Digital TV receivers has improved considerably since broadcasts began in 2001, however by mid 2005, penetration has only reached 650,000 digital TV receivers (including set top boxes) which would classify digital TV still very much as a niche medium.The key drivers for digital TV sets are actually not digital TV itself but the uses of DVDs and plasma screens.
A relative small percentage of the TV sets and the Set-Top Boxes (STBs) are fully HDTV-enabled.Advertisers are increasingly being deterred by the networks’ long-term audience erosion and constant demands for higher ad rates.
This threat is being exacerbated by PVRs that let viewers skip ad, and other platforms such as mobile phones and the Internet that often can reach consumers in a more targeted fashion.As from mid-2006, Telstra itself, directly and indirectly, will become the major competitor to Foxtel.
Broadband TV or IPTV is rapidly conquering the world.
It has already been introduced by TransAct in Canberra and will soon spread around the country, in the first instance through telcos such as Primus, iiNet and others.Telstra is currently experimenting with Internet delivered TV and has been buying Internet rights to TV programs from Hollywood producers.
However Telstra admits that its broadband network is too slow and will remain too slow for at least another 5 years in order for it to be an attractive enough alternative to watching free-to-air TV.Telstra will certainly pull out all stops to make life as difficult as possible for potential DSL TV players; however, with the new access charges, wholesale facilities such as ULL and line-sharing are looking more interesting by the day.But Telstra can’t dominate the broadband TV market, so no matter what happens on the Telstra DSL network, broadband TV is going to flourish one way or another.
And this is where Telstra’s future lies.
In a narrow space Foxtel is a monopoly, but its future would be very dubious in a market with cheaper and more diverse choices once broadband TV is able to deliver thousands and thousands of video-based applications.Video-on-demand (VoD) does exhibit good potential on the new information and entertainment superhighways, but the vested interests involved are making it very difficult to come up with workable models.
There is far too much conflict of interest between the key players in this market.Both Foxtel and Austar have very limited VoD services – they provide hardly any choice for customers.
Foxtel can’t use its HFC network to deliver VoD and it is stopping everyone else from obtaining commercial access to its network, so nobody gets a chance to test this market.There may be a better opportunity over the broadband network.
For instance, Telstra will soon stream video to BigPond subscribers.
Other BSPs can use their DSLAM infrastructure to deliver services (ADSL2+).With mobile TV becoming available, the industry has been looking at new technologies to deliver such services in a more efficient way.
At present, when two mobile TV users next to each other are watching the same TV content, two different mobile channels are used for the delivery.
A new technology, known as Mobile Broadcast Multicast Services (MBMS), makes it possible for any users with a particular cell to use one channel.