OTT video to overtake IPTV by 2013

More people will be watching over-the-top (OTT) video than walled-garden IPTV by the end of 2013, and in the UK, that point has been passed already. OTT services will overtake IPTV in 2013 and then leave it quickly behind, reaching a subscriber base of 380 million by 2015 according to research by Informa Telecoms & Media. By then, there will be 163 million watching IPTV, which is still a big gain compared with the 45.3 million IPTV subscribers at the end of 2010 reported by different research from broadband analyst group Point Topic.

But this global picture masks great local variations, especially within Europe. In the UK, where OTT has already overtaken a lackluster IPTV sector, Informa predicts OTT will have eight times as many viewers by 2015, at 27 million compared to 3.6 million for IPTV. But in France, IPTV will still be ahead, and it is currently the world’s cheerleader for IPTV accounting for almost 25 percent of the total number of subscribers at 10.25 million, according to Point Topic.

Behind these figures lies some split hairs, because the distinction between IPTV and OTT will fade quickly and all but disappear in many countries within five years. Both are often delivered over the DSL or fiber-to-the-home (FTTH) access infrastructure already, with the difference being in the backhaul and core networks. IPTV is delivered over a service provider’s own infrastructure, while OTT comes over the public Internet and, as such, is subject to quality factors beyond the operator’s control. But with the proliferation of content delivery networks (CDNs) over the next few years, ISPs will increasingly be able to offer guaranteed quality of service right to the end point either for OTT providers such as Netflix or directly to content owners.

This is the real story of these OTT forecasts. It is true that current OTT growth is being driven either by successful low-subscription operators such as Netflix or free content services, such as BBC iPlayer in the UK. But in the longer term, the reason for bullish OTT forecasts is that OTT as we know it will cease to exist only to be replaced by a high-quality public service. The walled garden will have become history.