Fledgling medium focuses on early days.

The second annual IPTV World Forum, which was held at London's Olympia exhibition center last month, took the form of a series of seminars and exhibition of companies offering goods and services aimed at the nascent IPTV market.

And IPTV is, indeed, nascent. Vincent Chabrier, business development manager at France's Fashion TV, estimated that the first IPTV platform launched, "five years ago, possibly less," but approximated that, now, there are, "30 to 35 IPTV platforms worldwide, and that number is growing quickly." Of course, Fashion TV is an established content provider that runs its own linear channels which, reported Chabrier, "run nine different feeds worldwide," and it sees IPTV as another logical extension of its business, providing the opportunity of deriving extra revenue from a newly emerging outlet.

One critical question is, "what is the size and value of this newly emerging business opportunity?" The simple, and honest, answer is, no one is really that sure. Tom Munro is CEO of Verimatrix, a company that offers a "watermark" digital right management (DRM) solution trademarked as "Videomark." This system places a unique, and indelible code on every encryption so that, when the encryption is decoded at the set-top box (STB), if the resulting free transmission is copied, it will be possible to trace the time and date of the copying, and address of the STB, from which the copy was made.

Munro has seen reports that estimate the worldwide number of IPTV subscribers, "between 2.5 and 5 million." On that basis he feels the real number is, "probably around 2-3 million." Whereas Eddie Abrahams, strategic development director at YooMedia, a company, which provides the technology giving the Sky Box in the U.K. a return path, said, "Currently there are fewer than 10 million IPTV-enabled homes worldwide," but added that, "I have seen research which suggests this number will reach about 60 million by 2008."

Whether this number is realistic, nobody seems to know, but Verimatrix's Munro said that he does know what IPTV has to do to be a sustainable long-term business, and how that's most likely to be achieved. "To prosper," he insisted, "IPTV has to be able to make a more compelling offering than cabsat." He believes there are three components of IPTV that will help achieve this: "More content," is his first prescription. "If IPTV can achieve the fabled 'one million channel universe', then," Munro believes, "that will give it a massive advantage over cabsat. The second prescription," he continued, "is that IPTV offers a much faster switch to HD than does cabsat," and finally, he concluded, "it offers a genuine two-way system."

Scott Reeves, technical director, EMEA at newly-formed Ruckus, believes his company offers IPTV another potentially big advantage over cabsat--the world's first "in-home smart Wi-Fi system." Essentially, this is a technology that will allow the dissemination of an IPTV signal to any number of sets in the home. This, obviously, obviates the need for drilling holes in the fabric of putative subscribers houses and, said Reeves, "provides a big plus for many people." Although Ruckus will sell the technology directly to the public, Reeves said that the company's focus is on sales to IPTV platforms, and they were therefore particularly pleased to be able to announce at IPTV World Forum their first European sale--to Ireland's Magnet IPTV platform.

Because IPTV is still a new business, exactly what that future will look like is still not clear; a business model adapted specifically for the medium has yet to emerge, and Fashion's Chabrier said that they are still being modeled on those currently applicable to cabsat.

The two main models are based either on the operator paying the channel provider a monthly fee determined by the number of subscribers, or some form of revenue share. Whether or not some form of window is applicable, Chabrier reported, is, like so much else in this nascent business, "very much an open question." In the case of Fashion TV, their In Vogue channel, aimed at women, gives their linear feeds a 48-hour window over any IPTV usage; whereas FTV Men allows contemporaneous use of content. This, said Chabrier, "is because it is much more important for women to see new fashions first than it is for men." It seems there are some things technology will never change.

Whatever business models emerge, and however exaggerated talk of a "one million channel universe" may seem, one of the few things that can be said of IPTV with any certainty is that, if it does mature into a genuine business, there will certainly be vastly more channels than has ever previously been the case. It therefore surprised Rob Machin, executive creative director at U.K. branding house English and Pockett that, "nobody seems to be thinking about branding." And it doesn't take more than a few minutes with Machin to see that IPTV will offer some significant branding challenges.

"To begin with," offered Machin, "people choose content and not delivery systems, but if the platform or delivery system is itself heavily branded, then that is going to get in the way of channel branding. Also," he continued, "it seems highly likely that much of the IPTV offering will be in the form of VoD, which greatly reduces the opportunity for branding, and means that you will be forced into branding 'micro areas'." Machin also believes that, "While it will still be vital that consumers associate your brand with top quality content, the selection process in a world with such a vast array of channels will change, and this will alter the point at which branding kicks in." Essentially, the point Machin is making is that in the new world, the consumer's selection process will start with the choice of genre, not of channel, and that branding only becomes relevant after the genre has been chosen.

Although, "not many people are giving proper consideration to branding, some are," reported Machin, and, although at press time he was not in a position to reveal details, he did tell VideoAge that, "We will shortly be announcing a deal between a number of channels with different content, but the same demographic target, to run cross-channel promotional packages and even establish jointly run and funded channels."

It is far too early to predict the future of IPTV, but at the World Forum it was noticeable that technology companies outnumbered content providers by, at a rough estimate, 30 to one, and, if IPTV is to grow, at some stage that must change because, as English and Pockett's Machin pointed out earlier, "People choose content, not delivery systems."