Improvements to IPTV Service May Lead to Greater Adoption Among Telecom Providers

This past week Google garnered headlines when it filed applications in Kansas and Missouri to provide video services as part of its Kansas City fiber roll-out. The company said it would use “national and regional video headend facilities to send IPTV across a private (IP) network to subscribers.” In the week prior, McMinnville, Tennessee-based Ben Lomand Telephone Cooperative announced that it would expand and upgrade its IPTV service with Harmonic's ProStream 1000 platform. While the two are obviously unrelated, the pair of announcements seem to indicate a renewed faith in IPTV from the newest to the most traditional providers. Most importantly, for rural and independent telcos, IPTV could be a way for companies existing (or planned) broadband networks to compete with cable companies, retain customers, and attract new subscribers.

In the past year we've seen providers as diverse as CenturyLink, TDS Telecom, Palmetto Rural Telephone Cooperative, Paul Bunyan Communications, Etex Telephone Cooperative, and SRT Communications all herald the benefits of offering IPTV. And for one of those providers—TDS—the implementation of IPTV led to a tangible drop in churn and a gain of 30% market share against national cable providers in just three years. So it's no surprise that companies like Ben Lomand Tel are stepping up their video services in a rural area of Tennessee, where the cooperative could gain an edge on the cable cos.

Like so many cooperatives across the country, Ben Lomand began concentrating on fiber deployment years ago, and in 2005 connected some of its first neighborhoods with fiber optic capabilities. Since then, the company has been able to build off of its increasing fiber deployments—the main expense for offering IPTV. Now that the company is ready to upgrade its digital TV services, Ray Cantrell, chief technology officer for Ben Lomand, says that Harmonic's platform will actually cut down on capital and operating expenses for video services by reduced power consumption and rack space, while allowing the cooperative to meet growing demand. According to Harmonic's press release, the platform will ultimately provide Ben Lomand with “high-density, real-time transcoder to power HD and SD video for its 200-channel HD and SD IPTV service,” known as BLTV. Harmonic ProStream offers 18k channels worldwide. Cantrell said, “The ProStream 1000 with ACE delivers the video quality, functionality, and reliability to make it possible to expand our digital TV services successfully and cost-effectively, allowing us to bring high-quality, state-of-the-art IPTV services to rural areas.”

BLTV is already available in much of Ben Lomand's service area, including Warren County, and parts of White, Cumberland, Coffee, Van Buren, and Grundy Counties in Tennessee, and is expanding on a neighborhood-by-neighborhood basis. The company offers “all-digital, state-of-the-art service carried over our fiberoptic telephone lines,” including nine different premium packages, “InDemand” pay-per-view, and HD and DVR capabilities in some locations.

In years past, IPTV deployments were often hampered by poor Quality of Service—but because of better delivery systems, middleware, and software interfaces, telcos are now able to offer reliable service with all the bells and whistles, just like the cable giants.

Service and monitoring has improved, too. Companies like Smithville Communications, in Ellettsville, Indiana, credit their successful IPTV deployment to better network monitoring and reliable Quality of Service. Part of Smithville's success is due to something called “proactive service assurance”—advanced solutions in IPTV that allow telcos to monitor and detect problems with service all the way to the customer's home. Analyst Mark Savoie says that as technologies like this have improved, “This combination of better service consistency, faster resolution and reduced operational costs is a triple whammy” for telcos with IPTV. Often, says Savoie, network disturbances are detected and corrected before customers are even aware there was a problem. He goes on to say that “to consistently deliver high quality of experience... improve[s] their customer retention. With estimates that upwards of 65% of all customer churn is triggered by service quality issues, there is no question how crucial delivering superior customer experience is to the success and growth of rural telcos.”

On the customer experience side, some telcos we've seen are taking advantage of software platforms like Microsoft Mediaroom. These upgrades enable, as Chuck Crabtree of Palmetto Rural Telephone Company said, “a very slick, great interface” with services consumers have come to expect—like VOD, whole home DVR, and even remote DVR.

We're seeing more and more companies mention IPTV when they announce plans to build out a fiber network, too, such as West Kentucky and Tennessee Telecommunications Cooperative (WK&T), Ben Lomand's geographic neighbor. WK&T said this year that it is planning to incorporate IPTV into its FTTH build, thanks to a $123.8m Broadband Initiatives Program loan and grant package from the RUS. The fiber network will reach to all of WK&T's 21k homes and businesses in 22 exchanges of west Kentucky and northwest Tennessee. Upon completion next year, WK&T's network will line more than 2k miles of roadways with fiber, making it one of the largest Last Mile Broadband Stimulus grant awards, and the largest single award focused on wireline services.