IPTV Faces Struggle For Foothold Over Next Five Years

IPTV services face an uphill struggle against traditional broadcasters, according to new research from analyst Gartner, which claims the technology will take more than five years to become a revenue opportunity for operators.

The analyst estimates that Western Europe will see 3.3 million IPTV subscribers by the end of the year, and 16.7 million within four years, but claims the technology will “struggle” in the face of stiff competition from terrestrial and satellite broadcast dominance.

According to Gartner, IPTV services will be bundled with other technologies in an effort to foster subscriber uptake, with the result being IPTV revenues which rise from €336 million in 2006 to €3 billion in 2010 – a figure which the analyst expects could be much higher.

The company is optimistic for the future of IPTV, however, with principal research analyst Susan Richardson stating: “”While the short to medium-term profits from IPTV will be modest at best, carriers can’t afford to delay in the deployment of the IPTV platform. Those who delay too long will risk undermining their ability to be long-term key players in the consumer infotainment communications business.

“This is because IPTV is not a single service; it is a new distribution platform over which many services can be offered eventually. Investments now have to be seen in the context of seeding the ground for the future.”

There are currently around 75,000 IPTV subscribers in Britain, with the nation representing one of the smallest markets in Western Europe.

This is expected to increase rapidly, however, reaching 1.9 million by 2010, fuelled by the launch of services such as BT Vision (see BT Unveils Next Generation TV Service) and BSkyB’s forthcoming video on-demand products (see Sky To Launch IPTV Service In 2007).

Gartner: www.gartner.com