Nurturing the Market for TV Over Data Networks and On Your Phone

Stockholm-based Net Insight, whose U.S. customers include Broadwing and
Savvis, offers products that aim to guarantee quality of service while
also maximizing network utilization for video. It does this by building
products around a platform that it says utilizes the maximum available
bandwidth for video rather than requiring an overbuilt network to
ensure quality. That may be a subject for another magazine – check
netinsight.net
for links to coverage of the company’s Nimbra platform in the cable
industry – but we asked the company’s founder and head of business
development, Per Lindgren, to talk to us about the market for digital
TV and mobile TV both inside and outside the U.S.

FILM & VIDEO: Who are your customers in production and
post?

PER LINDGREN: In production, we’re seeing a number of different clients
in the post and broadcast areas that are either buying services or
building their own private networks. More so in Europe, they’re using
SDI and HD-SDI to build their own networks. Large broadcasters have
fully uncompressed connections from their cameras to monitors, not only
in the studio but over fiber networks between different cities and over
the public networks. They’re centralizing content machines and content
so you don’t have to distribute both equipment and storage. You can be
more centralized, and do remote editing across a fibre-based network.
Right now, the delays and quality of service make it feel like you’re
sitting in the same building, instead of in two different cities. One
of the biggest German post houses has built a five-city network using a
GUI on top of our equipment that lets them set up five locations for
remote editing and playing uncompressed feeds for client review. That’s
a very state-of-the-art network, carrying compressed feeds but also
uncompressed HD and SD.

Clients can buy this as a service. In the U.S., Vyvx has been the
traditional leader, but the runner-up is Broadwing, using our
equipment, and sending not only compressed but also uncompressed HD and
SD feeds over our backbone. As a broadcaster or post house, you can
lease capacity and buy the equipment yourself. In that sense, you can
better set up how you use feeds for different types of applications.
You may have more file transfers and large data applications, but in
parallel with real-time HD and SD feeds.

What about in distribution?

There are many different platforms. We have the traditional playouts,
with cable and satellite being complemented with IPTV and even mobile
TV capabilities. Especially here in Europe, digital terrestrial TV is
huge. In large countries where you don’t have a large penetration of
cable and satellite, you now see penetration rates of 25 to 40 percent
for terrestrial digital TV distribution. It’s national buildouts where
we take in the feeds from the central head end and distribute that
MPEG-2 – and, more and more, MPEG-4 – out to mirror sites, where it
goes out over the air to a set-top box.

For mobile TV, there are a number of trials and even some initial
rollouts. Italy and Finland are using DVB-H mobile TV. This is a
parallel network to the live TV broadcast over the terrestrial network.
In handhelds, you have dual receivers, one data and one DVB-H or
Mediaflo receiver. Mobile operators are looking at rollouts or trials
for mobile TV in the U.S. And these different distribution forms
combine with different distribution models – who is getting paid by the
end customer, and who gets paid from the content
owners?

We’re also seeing people like Google and Yahoo looking at building
their own private services for video applications and real-time
streaming. They might be another player in this.

Where does Net Insight fit into the
picture?

We offer video network transport equipment. Our focus is on
video-intensive networks and content-production networks. If a
broadcaster wants to buy its own private media network for both
production and distribution, typically they build a network for HD-SDI,
and we can provide LAN-to-LAN and IP data feeds over the same network
so they don’t have to buy that network separately. The same goes for
post-production, video content creators and others, with a focus on HD.
We typically don’t provide storage, but we can provide transport
between storage systems. We do the pipes, so to speak.

And what’s your approach to
that?

We multiplex the different feeds along the same fiber or pipe, using
the leased-line capacity clients have. We see problems as soon as you
start adding a lot of video because legacy networks, traditional
optical transport networks, are quite rigid in their structure. IP
networks, because of the quality-of-service burdens, are typically
using priority schemes. When you have a majority of traffic going to
video, priority schemes have problems coping. So we are helping the IP
legacy networks cope with the quality-of-service and multicast issues
they face today.

What factors are holding digital TV and mobile TV back,
especially in the U.S.?

For subscribers, the content hasn’t really been there. Why would you
buy something you already have if you’re not getting anything extra?
One of the key things we’ve seen in Europe is that IPTV is successful
when you have exclusive content, typically some type of sports content.
In Italy, where they don’t have a lot of cable, IPTV penetration
increased tremendously as soon as they got all the soccer rights, and
the service was a commercial success. Also, they want to provide HD in
the future, so people have been waiting for next-generation compression
and set-top boxes that can handle it.

The trend in Europe is toward mobile TV, with a lot of trials going on
and roll-outs being planned for next year. There is DVB-H and the
Mobile TV alliance with Motorola, Nokia and Microsoft. The other
initiative is MediaFlo, with Qualcomm behind it. Another big thing
happening is digital terrestrial television as a complementary platform
to telco IP and cable and satellite digital TV. Typically, this is
driven by a desire to shut off the analog networks and free up spectrum
in the air for more mobile services like mobile TV.

Is IPTV going to expand the range of content available to
viewers?

That’s one of the nice things about IPTV and IP video – local insertion
is much easier to handle from anywhere on the network instead of having
a centralized approach via a cable TV provider and a central head end.
Now it’s much easier to do local TV channels, local sports or local
government coverage. The next step is more content also coming from
subscribers. As soon as we can get good quality of service from
anywhere on the network out to subscribers, we’ll see more local
content and more personalized content being provided to subscribers,
from professional large media companies and also from amateur
sites.

In the U.S., “net neutrality” has become a political issue. Is
that a factor in successful IPTV
rollouts?

Yes. In many European countries, the government gives money to local
communities to build large fiber networks. Now it’s not actually telcos
who provide fiber infrastructure – it’s typically the communities. A
very similar discussion of net neutrality has come up. All different
types of service providers and media providers should be able to
connect to these media networks, and connect in a fair way. The good
thing as a subscriber is you can choose from any service
provider or any media provider. If you are connected to the equivalent
of Verizon you only have Verizon as an alternative for your IP,
broadband service, and only for what they are providing in terms of
content. And that ties into the same questions. The problem is it’s
harder for the actual ISP to justify going into the smaller cities. If
you know you’re one of the first you can expect a certain penetration.
But if you have to [share the market with] competitors, your ROI will
most likely be lower or longer.

Is digital cinema becoming an important
market?

[Net Insight customer] Broadwing has already done things for digital
cinema distribution over their network. Discussions have been going on
for a number of years, but we are now close to seeing a roll-out. We
also discussed these applications a couple of weeks ago with a large
media company in Asia, and they’re also seeing this as a very big
opportunity – but it’s hard to predict when it will take off. From a
technology point of view it’s possible today. But it’s also a mindset
that has to be changed. We are used to certain distribution models and
ways of doing things, and there are content security issues. Changing
those patterns takes a while. But I’m pretty positive that we’ll see
some roll-outs next year.