IPTV Commercial Rollouts Planned

Three telecommunications companies plan to deploy services based on Microsoft TV IPTV Edition, Microsoft’s platform for delivering live television and on-demand video over Internet Protocol (IP) networks, by early 2006. These planned deployments emerge from an early-adopter program begun in 2003, during which Microsoft convinced partners to provide hardware and services and helped potential customers conduct trials. IPTV Edition stands a better chance than past Microsoft TV efforts because it focuses on a motivated customer segment (telephone companies) and proven feature set (video). Nonetheless, IPTV is still untested in the market, and unforeseen technical or business factors could stall adoption.

Platform Requires Infrastructure Upgrade

After achieving little success with its platforms for TV operators, Microsoft revamped its strategy in 2002 to focus on two platforms-one for today’s cable TV market and one focused on broadband providers.

Foundation Edition, available since June 2003, is intended for cable TV providers and includes a searchable onscreen program guide, as well as technology for operators to build interactive Web-like pages that can be embedded in the guide. Unlike past Microsoft TV platforms, which required cable companies to deploy expensive new set-top boxes in customers’ homes, Foundation Edition works with the current cable TV infrastructure. Microsoft has had some success with this approach: in the United States, for example, Comcast has started to roll out the software and plans to deploy it to about 500,000 households in Washington State by the end of May 2005.