Abstract

Optical Fiber to Become Mainstream Broadband Technology

IPTV service will drive the development of optical fiber technology for the following three reasons. Firstly, since IPTV services are broadcasted on a single channel, in the future, when every TV set in the household receives IPTV signals, the amount of available bandwidth would be an issue. If operators fail to provide sufficient bandwidth, development of IPTV services will be baffled. Secondly, IPTV content will evolve towards HDTV standard, which will require more bandwidth for transmission. To ensure enough bandwidth for HDTV signals, which usually ranges from 4Mbps to 13Mbps, operators will need broadband technology with higher bandwidth. Thirdly, with the rise of Triple Play services, bandwidth and transmission quality will become a key factor for subscribers' widespread adoption of IPTV services. As a result, broadband network upgrades will be a fundamental task for telecoms. Since optical fiber can better address operators' needs for bandwidth than any other broadband technologies, telecoms have been injecting investment into the optical fiber sector.

Nowadays, telecoms tend to use optical fiber along with xDSL technologies to provide high-speed broadband services due to concerns over the excessively high cost of optical fiber. However, as the cost of optical fiber is falling, and given the deterioration of quality for ADSL2+ and VDSL 2 in long-distance transmission, optical fiber will become the mainstream IPTV technology. At this moment, all East Asian nations are using FTTx technology for their IPTV services.

Customized Purchasing Schemes and Innovative Content

Content will be a crucial factor for the success of IPTV services. In addition to providing affordable basic channels, IPTV operators should offer a rich selection of programs that allow subscribers to purchase individually based on their needs. Operators can also provide a wide range of service packages, such as bundled services for a low charge rate, to increase their product differentiation.

Provision of a variety of innovative content is also key for IPTV operators. Such strategies have been adopted by Hong Kong's PCCW and Japan's KDDI. PCCW's VOD channels and network value-added services enable subscribers to shop or buy movie tickets online through DSL networks. With KDDI's downloading services, subscribers can pay for downloading 5,000 movies and more than 10,000 karaoke videos. KDDI is also planning to add an online shopping service that allows subscribers to make purchases over the IPTV shopping channel with their remote controls. The addition of interactive content such as e-voting, interactive games, interactive e-learning, short messaging services, entertainment, and online chatting, also helps KDDI create original service content, attract new subscribers, and boost ARPU (Average Revenue Per Unit).

Appendix

List of Companies