Digital TV by wxr16887


									                                   Digital TV
                              Technical and Market
                                      Peter Ellis BA DMS
                              Author: “Interactive Applications for Digital TV”

                     Why is Digital TV Significant?

                                The Power of TV
                               UK Digital TV users
•   Sky (satellite) 3.2 million -launched November 1998
•   ONdigital (terre strial) 770, 000 - launched November 1998
•   Cable (CWC & Telewest) 250,000 - launched 1999/2000
•   UK TV home s total 23.82 million

                                 Customer Attitudes
•   Digital Application Consortium (US ): 60% of 600 households surveyed were looking for
    interactive apps with digital TV (1998)
•   Jupiter Communications: 35% of UK and 29% of French households were willing to pay for TV
    interactivity (1998)
•   Inteco: 42% of surveyed UK households were interested in interactive apps (1998)
•   ITC Re search: only 20% of UK respondents intere sted in interactivity however (1998)
•   TPS reports that 33% of subscribers are using home banking and 65% interested in other apps

                            Web TV trial/NOP 1999
•   More detailed information
•   115 home s in Liverpool
•   76% would buy digital TV in 12 months
•   Internet access and e-mail seen as biggest benefits
•   Enhanced game show s biggest area actually used
•   70% considered online purchase s, 78% considered interactive TV as educational tool
•   Might pay extra for educational apps, web content, web content/TV shows, banking, shopping
    (in that order)

                                         The Players
•   The existing TV companies
     – Commercial TV (eg Carlton/Granada - ONDigital)
     – BBC
•   Pay TV/Satellite broadcasters
     – Sky
     – Canal + etc
•   Cable companies
     – NTL, Telewest, CWC
•   Software giants
     – Microsoft
     – Sun

                                 The Players (cont!)
•   Telecoms Companies (France Telecom, Deutsche Telekom, BT would-be)
•   Adverti sers (UK TV advertising market worth about 7.5 billion a year from about £13bn total)
•   Media giants (Sony, Warner etc)
•   Numerous large high street retailers
•   Niche retailers from Internet world

                       Social and Economic Context
•   E-commerce central to most busine ss strategies
•   E-Government also a key force in most Government policies
•   Restructuring of the workplace and work force - large numbers of SOHO and virtual
    home-based workers a s traditional systems di sintegrate
•   Drive to reduce all costs
•   Globalisation of all markets

                            The Internet Connection
•   Digital TV and the Internet increasingly linked
•   Internet has around 200 million users w wide
•   35-40 million in Europe (UK about 10 million weekly)
•   UK SMEs connected expected to pass 1 million by 2002
•   Some E-commerce predictions:
     – McKinsey: US home shopping $4-5bn by 2003
     – Jupiter: US Internet retailing $37.2bn by 2002
     – Forester: $3.2 trillion for all Internet commerce by 2002!
     – Verdict: UK E-commerce £2bn by 2001
•   E-Government developments include digital TV:
     – UK - Digital TV one of ‘channels to market’
     – Other European countrie s - most mention DTV

•   UK usage at an all time high (73% of viewers) in 1998
•   51% of men used it on daily basi s
•   But only 15% of women
•   Higher % of users in ABC1 group
•   10-12.5% of UK holiday products bought via Teletext
•   ITC data

                                    Market Restraints
•   Confusion over rival technologies/platform s
•   More complex usage model compared to traditional TV - more technical/active - experience of
    BSkyB’ s EPG
•   Cost of entry - digiboxes etc (now mostly free however)
•   Standards - e specially re content and applications
•   Reservations about use of credit cards/payments
•   Content wars - enough quality to go round? Content drive s the market.

                                  Set Top Issues
                              Set Tops - Hardware 1
•   Processors - 1st generation boxes usually quite low power compared to PCs
•   Memory - 1st generation boxes also quite low 2-4 Mbyte s of RAM and ROM/EEP ROM
•   Usually no secondary memory for 1st generation boxes
•   However, 2nd generation with more local memory appearing and XTV boxes will ha ve up to 20
    hrs storage so long term trend is towards more off -line usage
•   Card readers - conditional access to service s + payments
     – Smart cards (France etc)
     – Proprietary magnetic cards (UK banks)
     – PCMCI A standard approved by the Digital Video Broa dcasting (DVB) group

                              Set Tops - Hardware 2
•   Currently almost everyone uses a modem return path - typically 56K bps
•   Cable modem return path - can be 500K to 10 Mbps but more expensive and standards not
    resolved Europe favours DAVI C, US favours DOCSIS). CWC using DOCSIS and NTL DAVIC.
    Some boxes available but problem is finding a service. Also need for fibre drop
•   Some experiments with a broadcast return channel but not widely in use
•   ADSL - may be used for next generation boxes by satellite operators to give faster return path

                            Set Tops - API Software
•   Canal+ - MediaHighway. Proprietary programming language, low hardware requirements (hence low cost),
    local interactivity, hardware independence. Leading platform in Europe
•   TPS - OpenTV. Involvement of Sun and Thompson. Uses a optimised version of Java to reduce local
    processing requirements. Also very successful
•   BSkyB - OpenTV
•   WebTV - Bought by Microsoft in 1997. More processor intensive but provides full Internet a ccess.
    Experiments with Telewest. Originally proprietary code, now migrated to WinCE operating s ystem
•   Liberate DTV Navigator - backed by Oracle. Intermediate hardware requirements and being used by UK
    cable operators. SA Power TV used by NTL but problems
•   BetaNova - Kirch group Germany

                             Set Tops - CA Software
•   Acce ss to broadca sters signal
•   Variety of system s
•   Can mix and match with APIs
•   Interfaces with API defined by DVB

                   Leading Digital TV Platforms
              Set Tops - Interactive or Enhanced TV?
•   Inte ractive
•   Thick client
•   PC-like
•   Complex to use
•   Inte ractive use
•   Full web access
•   Networked to other devices (Personal Java/Jini, WinCE)

•   Enhance d
•   Thin client
•   TV-like
•   Simple to use
•   Passive use
•   Limited we b access or none
•   Stand alone
                                The Internet Model?
•   Full web browsing
•   ‘Walled Garden’ of specific internet site s
•   Directed web-content
•   Embedded links
•   Dial up e-mail only

                                      Content Issues
•   Most first generation API owners are making it easy to develop apps by m aking API s available
    and developing authoring tool s (eg to convert HTML to appropriate formats). Wide range
•   Satellite and terrestrial will not display web content without reauthoring
•   Internet/HTML camp stre sse s time saved by not having to port/re-author HTML content and apps
    (NTL ha s said it could be as much as a third of costs) - but no integrated Internet for cable yet
•   But new generation digiboxes for satellite and terrestrial are promised to be able to re -format
    HTML content (next year) and will offer open web access

                               Distribution Networks
                               Networks 1 - Satellite
•   Satellite
•   Direct to home (DTH) or to cable headends
•   Essentially a one-way system
•   Well-establi shed in analogue form and first to market in digital form
•   Now v. profitable because of low infrastructure overheads
•   Large scale content owners
•   Large audience already
•   Large channel capacity: BSkyB has 54 ba sic and 60 NVOD channels

                                Networks 2 - Cable
•   Usually hybrid fibre coax in UK (two-way)
•   Can be a fully two-way system with cable modems and fibre drops
•   Much greater bandwidth - v. fast internet browsing (up to 30M bps for downloading) but cable
    modem and fibre drop needed. Also service s not yet widely available and not yet integrated with
•   Multi-service (often includes phone)
•   But not content owners (buy from terre strial and pay TV)
•   Later to market than satellite so audience only now building up. Some serious delays and
    technical problems, especially NTL. Also other distractions eg rolling out profitable phone
    servi ce, getting taken over, taking over etc
•   Pre-eminent in some national markets

                            Networks 3 - Terrestrial
•   Broadca st system to standard aerials
•   Minimum disruption to existing equipment
•   But needs complex transmi ssion network
•   Limited interactivity provided via phone line
•   A few apps eg e-mail, digital text, games, PPV and basic shopping
•   Majoring on simplicity, quality and additional broadcasting choice rather than complex
•   Fewer channels: 11 free to air, 14 primary and six premium rate

             Networks - Interactive or Enhanced TV?
•   Satellite is favouring the ‘enhanced’ TV model:
     – limited web access, linked to broadcasts if at all
     – clever derivatives of local interactivity
     – reliable, robust TV
     – wide programme choice and strong content at core of offering
     – limited full interactivity
•    Cable is favouring the ‘interactive’ TV model
     – freer web access
     – exploiting full two-way interaction
     – involvement of Microsoft
     – However, service offerings not integrated with TV yet
•   Terrestrial is favouring an ‘ease of use model’ with limited interaction

                             Convergence of Models
• Cable and Interactive TV camp (Microsoft etc) is having to pull back
  from unlimited web-access because advertisers won’t wear it
• Satellite and terrestrial camps are both planning to offer Internet access
  on next generation digiboxes because public is demanding it
                            The Applications
                       Some Emerging Applications
•   Video on demand (VOD), near video on demand (NVOD), pay per view (PPV)
•   Electronic commerce - home banking shopping etc + shopping channel s
•   Digital Teletext
•   Internet access
•   Interactive advertising and CRM systems
•   Games

                                  On Demand Video
•   True VOD still expensive, despite fall in video server costs. But DSL makes it possible over
    phone lines (eg Yes TV)
•   NVOD more practical. Multiple channels make it possible to start same broadcast at interval s.
    Sky Box offi ce, Front Row etc delivered this way. Playout can be tape machines
•   PPV - simplest of all. Just acce ss to appropriate channel which is reserved for the event or film
•   NVOD and PPV make most commercial sense
•   Increased local storage will change delivery mechanism making it possible to download content
    and browse at will - high speed VCR

                           Home Shopping/Banking
•   Most operators have a variant eg Open….(Sky), cable operators, NTL ‘Interactive Superstore’,
    TPS Boutique, ONdigital has ba sic version
•   Range of large high street partners - often orientated towards large middle market brands
•   Most currently work by one-way embedding of data in video stream until you dial up and
    purcha se. Links to Internet site s for cable though
•   Range of items more limited than Internet shopping because there is limited interactive
    browsing invol ved at present, although most operators also have Internet sites
•   Concerns re security of payment system s but 67-75% of WebTV trialists had confidence to
    purcha se online
•   Well-establi shed in France - but use of bank smart cards
•   Some bank transactions limited

                                     Digital Teletext
•   Better graphics
•   Faster
•   Better navigation
•   But some technical problems at introduction eg BBC system used by ONdigital
•   Canal +, BSkyB and other satellite broadcasters have exploited local interactivity to give
    impression of full interaction eg sports stats (Notepad)
•   Mileage left in the system?

                                     Internet Access
•   Perhaps most contentious area
•   Fully interactive model clashes with needs of broadca sters and advertisers big time
•   Thus satellite and terrestrial favour enha nced model with access to a very few site s (if any)
    linked to adverts or show s etc - not really even a ‘walled garden’
•   Some high capacity business Internet possible by satellite
•   Cable has been enthusia stic, but in fact slow to deploy fully integrate d service s because they
    have same commercial problems as satellite and terrestrial. They are keeping open web access
    and TV access separate for the most part

                                Full Web Browsing
•   Cable separates out the Internet content connected with TV and unrestricted web-content eg
     – Telewest’ s Active Digital service displays Internet content from about 90 partners but re
       purposed for TV to make it look better. A true ‘walled garden’. However, its set top
       (Navigator) could handle HTML content
     – Telewest provide s full Internet browsing either via your phone line (Surf Unlimited) or via a
       cable modem and fibre drop (Blue Yonder) but thi s is onl y for a PC
•   Microsoft WebTV Platform DOES provide full web browsing from the TV along with with
    walled-garden access, embedded links etc but only to be used by NTL later this year in the UK.
    But MS building up stake s in cable everywhere including UK

                       Interactive Adverts and CRM
•   Pay TV already segments the audience
•   Respondents will already be receptive
•   Pioneered in France with Canal+ and TPS
•   Targeted marketing campaigns
•   CRM systems will gather even more data on us all according to viewing habits, programme
    choice s etc
•   Prepare for more personal junk mail and personalised adverts - you are being watched!

•   Basi c games use local interactivity. Widely available
•   Games linked to TV content eg ‘Strike it Rich’ for audience participation

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