IPTV Research James Heath Research Director Dittberner Associates Inc Montgomery Avenue Bethesda MD USA Toll Free: Tel: Fax:

Dittberner’s Associates, Inc © 2005 Dittberner Associates, Inc. 2 Dittberner’s Research KnowledgeBases One-Stop Source for Tracking Technology Innovation  In business for 40 years!  Dittberner’s Technology KnowledgeBases are the distinctive reference source for world class, carrier grade next generation system offerings and solutions.  Unique monitoring service comes equipped with powerful web-based tools for instant, accurate and dependable answers.  Customers include:  Sprint, France Telecom, Deutsche Telecom, NTT, Vodacom, Saudi Arabia Telecom  Cisco, Huawei, Siemens.

Dittberner’s Associates, Inc © 2005 Dittberner Associates, Inc. 3 Technology Areas Covered  NGN / IMS Solutions;  Security Technologies (VPN, Biometrics, PKI, contingency planning)  OSS/BSS;  Digital Switching;  Optical Switching;  xDSL;  Fiber Deployments (FTTx);  Multi Service Switches / HS Routers;  Wireless  Fixed Mobile Convergence We also offer strategic market consulting and customized research in all of the above areas.

Dittberner’s Associates, Inc © 2005 Dittberner Associates, Inc. 4 IPTV Research Report “IPTV Impact on Public Networks ”  Technology Review  Bottom Up Forecast  Activity in 77 National Markets  Network Models described  Service Provider Case Studies  Equipment Supplier Reviews

Dittberner’s Associates, Inc © 2005 Dittberner Associates, Inc. 5 IPTV Research Results Case 1: Ninety channels of SDTV, no channels of HDTV, each VoD bandwidth is 3 Mbps and VoD peak usage is 2% of TVs. Case 2: Same as Case 1, but with assumption that peak VoD usage is double, or 4% of TVs Case 3: Same as Case 1, but with 300 SDTV channels pushed out to the DSLAM Case 4: Same as Case 1 but with an additional 100 HDTV broadcast channels being pushed out to the DSLAM. Case 5: Same as Case 4 but with the average VoD bandwidth being 6.5Mbps instead of 3 Mbps Effect of Bandwidth Demand on Equipment Revenue in 2013

Dittberner’s Associates, Inc © 2005 Dittberner Associates, Inc. 6 IPTV Research Conclusions  IPTV Takeup will Be Slow  53 Million Subscribers to Telco TV by  Incremental Cost per Subscriber is Low  VDSL Incremental Cost $560*  FTTH Incremental Cost $383*  Service Provider Incremental Revenue is Low  $14 B in 2013 * Includes network equipment upgrade, STB, Headend, Middleware, DRM, and Content