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© Copyright Farncombe Consulting Group 2009 Digital TV Technology Trends and Internet Convergence Farncombe Consulting Group Barry Flynn, Principal Consultant.

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Presentation on theme: "© Copyright Farncombe Consulting Group 2009 Digital TV Technology Trends and Internet Convergence Farncombe Consulting Group Barry Flynn, Principal Consultant."— Presentation transcript:

1 © Copyright Farncombe Consulting Group 2009 Digital TV Technology Trends and Internet Convergence Farncombe Consulting Group Barry Flynn, Principal Consultant June 2009 – Digimedia 2009, Prague

2 2 © Coypright Farncombe Consulting Group 2009 Combination of different enablers and drivers is changing traditional DTV landscape DIGITAL TV TECHNOLOGY TRENDS Broadband return-path Increased storage Increased performance  More permanent storage as hard drives become cheaper  More semi-permanent storage as Flash memory becomes cheaper  Increased broadband penetration driving hybridisation with traditional DVB-T, DVB-S  Increased penetration of IPTV  Increased penetration of DOCSIS on digital cable  More powerful chipsets as processing-power becomes cheaper  More memory as RAM etc becomes cheaper IP everywhere  Video encapsulated in IP because more efficient SDTV→ HDTV  Enabled by increased performance, migration from MPEG-2 to MPEG-4, DVB-S to DVB-S2  Driven by consumer take-up of HD-Ready flat-screens  (Driven by DVD/games console quality versus over-compressed SD??)

3 3 © Coypright Farncombe Consulting Group 2009 Consumers expect more flexibility in content consumption in general and video in particular IN PARALLEL, CHANGING CONSUMER TASTES Expectation of ‘free’ content  Experience of Internet music and availability of pirated video leading to expectation that some premium video content should be ‘free’ at point of consumption Linear → Non-linear consumption Portability/mobility of devices  Mobile phones, MP3 players/iPods, portable games consoles – all encourage requirement for new devices able to deliver portable/mobile video content (although this may be a weaker trend than many have assumed)  In part because of Internet, but also because of increased penetration of PVRs, consumers increasingly understand/accustomed to/expect non-linear video consumption Portability/mobility of content  STB no longer a dummy device used to decode digital video → in addition to integrating PVR, expectation that STB will enable them to get access to personal content stored on PC and other devices, including photos and videos, and their favourite content from the Internet Video on the Internet  As broadband penetration increases, consumers increasingly accustomed to consuming video on the ‘open’ Internet, and via new CE devices with Internet connectivity

4 4 © Coypright Farncombe Consulting Group 2009 What happens when you marry these two sets of trends together? TV/INTERNET CONVERGENCE? TV TECHNOLOGY ENABLERS ? Confidential and Proprietary CONSUMER DRIVERS OVER-THE-TOP (OTT) VIDEO + ‘TRADITIONAL’ DTV

5 5 © Coypright Farncombe Consulting Group 2009 3 1 OVERVIEW OF THE FARNCOMBE GROUP DIGITAL TV TECHNOLOGY TRENDS CHALLENGES OF DTV/OTT CONVERGENCE 2 AGENDA

6 6 © Coypright Farncombe Consulting Group 2009 HYBRIDISING DTV WITH OTT VIDEO: STB PERFORMANCE STBS are more powerful today than they used to be, but….  Today’s STBs typically decode video with: –dedicated hardware –limited range of “frozen” standards such as MPEG-2/ MPEG-4  A wide range of OTT video formats that generally demand: – software-based decoding, and – higher level of processing-power than most STBs can deliver (even today, after much progress) This problem can be solved, but ….  Requires spending much more per box  This makes deployment prohibitive Today’s STBs are still not powerful enough

7 7 © Coypright Farncombe Consulting Group 2009 HYBRIDISING DTV WITH OTT VIDEO: ARCHITECTURE OTT video services change rapidly/are frequently upgraded  Media players, Internet browsers used for OTT video playback frequently upgraded  Similar issues arise with Internet technologies such as DRM and HTML A more fundamental difficulty: marrying a stable technology environment (DTV) with a highly dynamic one (the Internet) Issue not so much technical as economic  Even if engineers could adapt STBs to upgrade dynamically (like PCs), PCs have scale – 1bn+ now installed around globe (Gartner, 2008)  Vast majority are interoperable through use of Windows OS  PC software developers can spread costs of codec/player/browser/plug-in software development across large number of new PCs installed/yr  Plus receive occasional upgrade fees from installed base  This is not the case with STBs!

8 8 © Coypright Farncombe Consulting Group 2009 THE PROBLEM WITH STB ARCHITECTURE STBs do not enjoy economies of scale that PCs do, because DTV is highly fragmented  Interactive TV providers have tried over last 20 years to make ‘middleware’ platform- agnostic, e.g. using a Java ‘virtual machine’ (as in DVB- MHP)  But MHP generally acknowledged to have been a failure  MHP implementations have in practice been –stripped-down and customised –only nominally independent of platforms Applications HTMLJAVAMHEG5FLASH Applications Manager Middleware Services OS + Drivers Hardware CA Network Provider Special Services Source: Farncombe Consulting Group Pay-TV providers generally use proprietary combinations of hardware and software tailored to their own needs/territorial standards

9 9 © Coypright Farncombe Consulting Group 2009 WHAT IS THE ANSWER? Responses to PC/STB dilemma lie along a continuum, clustered at either end Accept that STBs will never be like PCs? Demand that STBs be PCs by any other name? OR

10 10 © Coypright Farncombe Consulting Group 2009 WHAT IS THE ANSWER? Neither extreme of continuum offers satisfactory solution Accept that STBs will never be like PCs? OTT decoding confined to a restricted range of video types Consumer not offered full range of OTT services available over the Internet Customers who expect full range of Web video services may rebel against “walled-garden” approach

11 11 © Coypright Farncombe Consulting Group 2009 WHAT IS THE ANSWER? Neither extreme of continuum offers satisfactory solution Demand that STBs be PCs by any other name? Technical solution problematic: PC architecture unlike STB’s Implied power consumption levels run risk of breaching new EU rules on ‘eco-STBs’ Even if possible for STB to migrate to PC universal/flexible architecture, cost of ‘STB- PCs’ prohibitive

12 12 © Coypright Farncombe Consulting Group 2009 WHAT IS THE ANSWER? Connected TVs present an intermediate solution ‘Connected TVs’ with limited HTML browser or ‘widget’

13 13 © Coypright Farncombe Consulting Group 2009 WHAT IS THE ANSWER? But limited services and potential non-upgradeability problematic ‘Connected TVs’ with limited HTML browser or ‘widget’ Technologies not standard/complete, upgradeable only if TV makers willing to pay ‘Widget’ does not offer PC/Internet functionality, potential lack of upgrades implies limited services Risk of consumer hostility because ‘connected TV’ experience just another ‘walled garden’

14 14 © Coypright Farncombe Consulting Group 2009 WHAT IS THE ANSWER? Responses to PC/STB dilemma lie along a continuum, clustered at either end Accept that STBs will never be like PCs? Demand that STBs be PCs by any other name? OR

15 15 © Coypright Farncombe Consulting Group 2009 WHAT IS THE ANSWER? Rejecting PC/STB dilemma by using headend may lead to scalability problems Traditional DTV Transcoder Set-top Box MPEG HeadendConsumers Traditional DTV codecs Video, Audio MPEG-4/MPEG-2 + OTT codecs Standard MPEG-4/MPEG-2 chipset OTT video Place transcoders at network headend  Can convert Web video standards in real-time into (narrow) range of formats supported by STB  Solves issue of making STBs dynamically upgradeable  But introduces additional, expensive infrastructure which might prove difficult to scale

16 16 © Coypright Farncombe Consulting Group 2009 CONCLUSIONS  Clearly, the digital TV industry is at a turning-point: –Consumer expectations are changing –Customers with broadband are creating home networks, leading to demand for OTT video (to the TV and PC) and to content-sharing between the TV and PC –Video-capable devices are all being connected to IP/broadband  This represents a major challenge to both operators and equipment-providers  Properly managing CPE strategy is the key to success (FARNCOMBE CAN HELP YOU WITH THIS!)

17 © Copyright Farncombe Consulting Group 2009 INTRODUCTION  For further information, please contact: Barry Flynn Principal Consultant Farncombe Consulting Group E-mail: barry.flynn@ftl.co.uk Tel: +44 1256 844161 Mob: +44 7720 566585 www.farncombe.eu Thank you!

18 18 © Coypright Farncombe Consulting Group 2009 BBC IPLAYER AND VIRGIN MEDIA An example of OTT viewing on the TV screen  Virgin Media, which offers the BBC OTT iPlayer service to its VOD cable homes, has reported that its cable network accounted for around a third of all BBC iPlayer views in May 2008  But the Virgin cable platform has a significantly smaller universe than the BBC’s online one –Around 44% of Virgin’s 3.5m TV customers were regularly watching on-demand content at that time (1.5m) –But the number of regular online iPlayer users was around 6m, on Farncombe estimates  This would mean viewers on the TV- based platform were each responsible for at least twice as many iPlayer views last May as those on the PC/online one


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