IPTV reality check

IPTV has been the subject of extensive media hype, especially with the recent attempts of American telcos to launch new IP-based pay television services.

However, in a recent report, Fortune magazine said some telecom and media executives have a more pessimistic — or “realistic” — view of the new technology. A recent survey by consulting firm Accenture found that only 4 percent of telecom, broadcasting and media executives think IPTV will generate significant revenue in the coming year.

And none of the phone-company managers surveyed thought IPTV would boost revenue in the next 12 months. Perhaps most surprising, Fortune reported, is that only about half are confident Net television will generate revenue in three years' time.

“We started to see a gap between what telecom executives were saying and doing and what their equipment and software providers were saying, and what was being hyped in the press,” Greg Douglass, global managing director of Accenture's media and entertainment practice, told Fortune.

Douglass does believe the phone companies eventually will see additional monies from their television gambits but he suggested it is going to take a long time.

First, he noted, the companies need to build new networks at huge capital expense, which Verizon and AT&T are in the process of doing. Then, he added, the telcos need to keep spending to make sure the networks are reliable and offer consistent quality — ”nobody is going to tolerate disruptions when it comes to TV programs.”

When IPTV will take off is unclear, the report said, but many in the industry think that will be many years away.