IP, Content Delivery Key To Telecom-Broadcasting Convergence

By William New with Pravir Palayathan
Content delivery and telecommunications are becoming rapidly intertwined in a “converging” world, bringing new opportunities but also likely leading to a dogfight among the high number of networks platforms for content delivery currently available, according to experts.

“Not every horse can win the race at the same time, and there is a lesson there for ‘convergence’,” David Wood, head of new media at the European Broadcasting Union (EBU), told Intellectual Property Watch. “Every day a new means of providing media to the public seems to come out of the woodwork, all convinced they will be popular, valuable, and make a lot of money. But it can’t happen. There will be winners and losers.”

The EBU hosted a 21-22 June “meeting of high-level experts” jointly with the UN International Telecommunication Union (ITU). “Our hope in organising the conference jointly with the EBU and ITU was to bring this into focus; and, if we accept that not everything can be successful, to see through to which would be more likely to succeed,” said Wood.

Linear media delivery can be done by any one of a growing number of ways, he said, including cable, mmds (multichannel multipoint distribution service), satellite, terrestrial, IPTV, broadband open Internet, digital mobile phones, and mobile broadcasting, with many also able to provide non-linear media. “That’s before you talk about packaged media,” he added.

“Convergence is blurring market boundaries between previously totally separated industries, such as the telecoms and the content industries,” Michael Bartholomew, director of the European Telecommunications Network Operators’ Association (ETNO) told the June meeting. “Telecoms operators are increasingly including content in their broadband offerings, creating new opportunities for content distribution. Content providers are adding voice or broadband services to their traditional offers.”

“One of the most interesting ‘who will win’ issues is the coming battle between ‘IPTV’ systems or ‘walled garden’ broadband, and plain vanilla ‘Open Internet’ or ‘open garden’ broadband,” Wood said. “The public will vote with its wallet and heart for one of them. Technically, they will choose between massive choice and lower costs, and more solid technical quality, but the winner will be decided by the content on offer.”

Another issue, he said, is “whether digital mobile phone systems like ‘G3’ will provide media to the consumer, or ‘mobile broadcasting’ systems, or possibly neither.”

“The conference did explore these issues, but you couldn’t say there was a consensus on who will be winners and losers,” said Wood. “Of course, if there were, I would not be here now, I would be buying shares in the right companies.”

There are three elements of the rapidly changing environment for digital content delivery, according to Houlin Zhao, deputy secretary-general of the ITU. These are technological change, market change and the availability of digital content.

The changes have led to a high number of choices for consumers, he said. For instance, a Swiss consumer theoretically has a choice between ten or more networks platforms, including: fixed-line, mobile and voice-over-IP for telephone calls; fibre optics, DSL, cable modems or Wi-Fi for broadband [high-speed] Internet access; and cable, satellite, over-the-air or IPTV for broadcast entertainment. There also are emerging new platforms, such as WiMAX or power-line communications, he said. In addition, there may be numerous suppliers, and this has led to significantly lower prices.

There are an increasing number of common issues confronting the ITU and EBU, Zhao said, such as access to content, multiple play, intellectual property protection, user-generated content. Furthermore, both sides are increasingly concerned with standardisation and the interoperability of platforms.

Zhao was careful to note that both sectors have a “long history of infrastructure investment” in rolling out networks, and that “we have to capitalise on that investment, not to devalue it.” The ITU and EBU signed a cooperation agreement on 13 April 2007 to guide further work, and the two organisations have already begun working together on projects such as on IPTV, he said.

Caution Against Over-regulation

A number of panellists in June cautioned against too much government regulation at a time when there is a technology explosion. “We’re on the verge of a tremendous amount of convergence,” said Don Whiteside, a vice president and director of technical policy and standards at Intel. “All computing products are rapidly becoming communications products. We increasingly are in a world where everything goes digital.”

Whiteside warned that a “command and control” regulatory approach to interoperability will not work as it could hinder the development of new technologies. In Intel’s case, it is investing in building wireless capabilities into its products, which he said will lead to lower priced products worldwide.

Whiteside described a “balancing act” between making content free and fully protected. Neither technology nor licensing, which creates trust and a governance mechanism for products, work against pirates, he said. Meanwhile, a key to the future is to make the different platforms used by consumers interoperable, he said.

Bartholomew said it is too soon for a legislative initiative for online content distribution, given the rapid change in the markets. But the European Union could facilitate the availability of content, for instance by increasing competition and transparency in collecting societies. He said the revision of the EU Television without Frontiers Directive is likely to be adopted in autumn and would cover on-demand and interactive services. But he questioned the need to extend traditional broadcasting rules to new online on-demand services.

Stephen Collins, director of government and regulatory affairs at Skype, also warned of legal and regulatory barriers, including control of content and licensing regimes.He cited jurisdictional barriers due to differences in national laws; political barriers such as censorship; anticompetitive practices; and network neutrality (users must be able to choose their content).

Collins recommended measures for a competitive marketplace, media literacy skills, and the recognition that on the World Wide Web, “content cannot be controlled.” To help address the global digital divide, he said online marketplaces like eBay might help though infrastructure is needed.

European Parliament member Ruth Hieronymi said digital platforms can coexist “if we choose an intelligent way of regulating them,” which she said comes from a focus on the content rather than the means of transmission. Also key is cultural diversity, she said. The European Union’s new Audiovisual Media Services Directive calls for single regulation for all media services regardless of the way they are transmitted, she said. The EU switch from analogue to digital technology will be completed by 2010. The EU will publish a communication on a European approach to online content in September, and a European Commission proposal for a regulatory framework for the electronic communications sector is expected in October 2007, she said.

Laszlo Toth, strategic director at the Hungarian National Communications Authority, discussed regulatory challenges of convergence and said a wide gap remains between telecommunications regulation and traditional media regulation. The significance of the decentralisation of content production to the community user level has not been fully grasped yet by regulators, he said. Regulators need to watch for dominant market powers and have so far encouraged open networks, he said.

Discussion of Technologies

Masao Matsumoto, director-general for technology policy coordination at Japan’s Ministry of Internal Affairs and Communications, described the country’s firm move to digital television broadcasting, and said Internet Protocol TV is being looked at as 100 percent of households are expected to have broadband (high-speed) Internet connections by 2010, the year before analogue broadcasting is scheduled to be terminated nation-wide. But there are still questions about IPTV, he said, such as quality.

Albhy Galuten, vice president for digital media technology strategy at Sony Corporation of America, said the goal should be to create the best experience possible for consumers and make digital rights management “invisible.” Consumers need to have rights over the products they purchase and the ability to use those products across their technologies, he said. Galuten described flexible business models, including advertising, purchase, rental and subscription.

Reinhard Scholl, deputy director of the International Telecommunication Union Standardisation Bureau, gave statistics showing the demise of fixed-line telephony and the rise of broadband, positing that IPTV may come to “the rescue” of incumbent telecom companies.

IPTV is defined as “multimedia services such as television/video/audio/text/graphics/data delivered over [Internet Protocol]-based networks managed to provide the required level” of service, experience, security interactivity and reliability, Scholl said. IPTV, still in its infancy, would represent an improvement over Internet TV, he added. The ITU telecom division has a well-attended focus group on IPTV, he said.

Bartholomew also mentioned the importance of IPTV and “self-made” content, and said television over mobile is “emerging as the next big trend in mobile services,” a view held by others in the conference.

Addressing the Digital Divide

The session also focused on the digital divide. Peter Knight, coordinator of the e-Brasil project, said conference participants face a challenge of how to take advantage of these technologies and digital content to “solve global problems [of] peace, sustainable development and poverty eradication.” This means using wireless information and communications technologies to increase access to knowledge for a greater proportion of humanity – possibly through non-written format (images and sound).

It was generally agreed that delivery and access to digital content in developing countries is below what is required to bridge the current gap despite progress made in areas such as mobile connectivity or the digitisation of content.

Various statistics showed that the broadband connection rate in developed countries is far higher than in developing and least-developed countries. Zhao said that only half of the 50 least developed countries have broadband service. Akossi Akossi, secretary general of the African Telecommunications Union, said that broadband penetration amounts to less than one percent in Africa.

Mogens Schmidt, deputy assistant director general for communication and information at the UN Educational, Scientific and Cultural Organization (UNESCO), said that in large parts of the world, radio is still one of the most-used devices to get information, and that traditional media still has a part to play.

Other issues discussed at the session included the role of standards. Alan Bryden, secretary general of the International Standardization Organization, said an action plan was put forward to involve developing countries in the production of standards.

The cost and affordability of digital content also were highlighted. Philippe Petit, deputy director general at the World Intellectual Property Organization (WIPO) gave examples of initiatives like microfinance institutions that give free access to children to computers, and said WIPO also works with small businesses.

Participants also raised questions about what was being done to address the special needs of farmers, women or handicapped people regarding access to knowledge. Remote areas need to be better served to ensure that no one is left behind, they said.

Broadcasters’ Role

EBU Director General Jean Réveillon said, “I believe that Europe’s public broadcasters have a unique role to play in the fast growing digital world. Europe’s audiences want outstanding content on all significant platforms. The unique, valuable and diverse content which Europe’s public broadcasters produce also by broadband is a vital part of that offering.”

Réveillon added, “The trust we have built with Europe’s audiences is the unique element which will ensure that public broadcaster’s content will be crucial to the success of many digital platforms and will become an essential element of tomorrow’s media content industry.”

William New may be reached at wnew@ip-watch.ch.