By Brian L. Clark
There they go again: Last week AT&T rolled out Homezone, its initial "IPTV offering" in San Antonio and Ohio. Turns out Homezone is less IPTV than just another package deal that brings together a phone company and a satellite service—in this case, Echostar—to provide the same types of voice, Internet and entertainment services many cable companies are already delivering.
Frankly, IPTV is looking more and more the DSL rollout from seven or eight years ago. At the time, it looked like the phone companies were going to beat the cable companies to the broadband punch. The problem was they weren't ready to deliver on their initial promises. I remember a gentleman from the newsroom at Money magazine who was on the phone every day for three months trying to get DSL installed into his NYC apartment. By the time they were finally ready to install it, Time Warner had launched Road Runner in his neighborhood and he just went with cable. I'm sure he wasn't the only one who lived through that ordeal. The end result: telephone companies botched the launch so badly they still haven't completely recovered. Today DSL has 44 percent of the broadband market compared to cable's 56 percent, and telcos have had to offer all manner of cut-rate pricing to reach that number.
AT&T spokesperson Amanda Ray says Homezone was part of the company's strategy to increase its video offerings. But it's dangerous for phone companies to even imply that these half-assed solutions as part of their initial IPTV rollout when the reality is, they have absolutely nothing to do with IPTV. When consumers subscribe and find out exactly what these services are, their experience will completely sour them on the idea (just like DSL). As a result, these telephone companies will spend the next few years of their rollout just trying to recover. Maybe this time, they'll learn their lesson.
Yeah, and maybe they'll offer IPTV for free....
This past week, I attended Sony's annual line show at Aspen, in NYC. There was the usual lineup of TVs, digital cameras, camcorders, and home theater units. But beside the fact that the air conditioning seemed to be broken and the new PlayStation 3 was safely posited behind glass, the most striking—but not surprising—thing about the event was the push for Blu-ray. Sony obviously hopes Blu-ray can carry the day for the company this holiday season, but I have my doubts. Honestly, how many people do you know who are going to pony up $1,000 for a technology that won't work with an existing DVD collection?
Just the same, look for the BDP-S1 Blu-ray Disc Player, Vaio BD-Enabled PCs, and the BWU-100A Blu-ray internal disc drive for PCs to come to your local PC and electronics store soon. Just don't look for a lot of people to be buying.
YouTube recently announced it had 19.7 million visitors in June, a nearly 300 percent jump over January, according to Nielsen/NetRatings. It's another indication viral video made with phones, camcorders and digital cameras is on the verge of posing an even larger problem than the networks ever imagined. Suddenly, people are entertaining themselves via the Web and the networks—who can barely handle competition from cable—are understandably nervous.
And speaking of YouTube, MTV Europe announced today it would launch MTV Flux, a new channel in the UK that only airs video created by viewers. According to Angel Gambino, MTV's VP of digital strategy in Europe, the new service will be a guide to the best of what's out there, and will come from phones, computers and any other video source. Users will be able to "snag it, drag it, and drop it into Flux," she says, where they'll be able to view it on the PCs, phones or TVs. Gambino adds that MTV will even offer tools that allow users to create ads for its new service. Hmm. A network where the network doesn't have to do any of the work—sounds like a good business to me.