Levi Shapiro was at the NATPE conference in Las Vegas recently and spoke with leaders in the IPTV field. The enclosed article will appear in an upcoming edition ofVideo Age International and IPTV Evangelist has the preview release.

Marcel Fenez is a twenty-year resident of Hong Kong and a devoted fan of IPTV. “PCCW captured 700,000 subscribers in three years because they offer more choice, on-demand movies and are the only source for English Premier League. Even Ipod didn’t capture that much market share in its first year”. Along with panelists from Telefonica, Microsoft, Thomson and Belgacom, Fenez discussed successful IPTV models from around the world. Whether in Hong Kong, France or Belgium, these learning are can be instructive for the future of IPTV in the US.

According to Bart Becks, who was responsible for an IPTV rollout in Belgium, there are three basic ingredients for IPTV to compete with cable. First, the technology has to be invisible to the customer. “It needs a very easy interface, with only one button to push, said Becks”. Panelist Benoit Joly of Thomson agreed, saying it must be “granny proof”. Second, IPTV needs to offer everything that cable offers, otherwise people will be reluctant to make the switch. “At a certain period, one of the Big 4 broadcast networks was not available, which hurt our take-up. To convince people to cancel their cable subscription, you have to offer same thing available everywhere else.” Finally, there needs to be some form of exclusive content. “In Belgium”, said Becks, “we bought exclusive rights to live football. This helped to increase churn from our competitors.”

IPTV involves television services over closed, managed network, usually owned by the service provider, which is typically the telephone company. IPTV is inherently hi-speed, and two-way. This creates the opportunity for personalized, dynamic ad insertion. In addition, viewers can see miniaturized screens while watching other programming. Now you literally see “what’s on” TV while without missing your show.

Culturally, IPTV has had an impact on the way Spanish viewers watch sports. Antonio Otero, VP Innovation at Telefonica VP Networks, talks about soccer viewing habits. “Twenty percent of Telefonica subscribers buy soccer match each month. Previously, people went to the local bar but now they are watching soccer matches at home.”

From the point of view of local stations, the greater bandwidth allows broader distribution for their content to a wider geographical audience. Becks cites a local television station in Belgium with a library of short-form travel related clips. These evergreen episodes reside in VOD and are being viewed by a broader potential audience.

Particularly, when there are fewer eyeballs, personalized advertising increases the value to brand owners. The capability, while not yet deployed, is to measure audience at the level of the zip code. What the panel did not explore was what type of advertising format, placement, and experience would be appropriate in a personalized advertising environment. Becks acknowledges, “We will need to use different metrics, rather than GRPs. IPTV can bring below the line advertising to mainstream media.” In short, this may make IPTV’s smaller long-tail audiences more appealing to advertisers as a micro-segment with the right ad for the right viewer at right time.

The key learning for IPTV in the US may be access to exclusive sports programming. Becks believes that “successful roll-outs have to have something exclusive, like only having the NBA available on AT&T. Costs a hell of a lot of money but its what they need to do to be in the game.”

Cable companies have learned that their customers want bundles. This year we will see AT&T and Verizon bundling video and television services in order to compete with the bundles offered by the cable companies. The true winner of this battle will be the consumer, who will have more choice and a richer viewing experience.

Today is the second day for the Future TV show here in New York City. Among the many speakers is Frank Chindamo of Fun Little Movies, who we interviewed last summer.

Some of news from Frank and FLM includes

-He has started teaching a new class at USC, “Mobile and Internet Viral Screenwriting and Production.”

-This month Fun Little Movies has also signed its 30th distribution deal. They are now all over the world: US, South America, Europe, the Middle East, Israel, South Africa, India, Australia, NZ, and the Far East, including several deals in China. We’re also all over the Internet, soon to be seen on Revver, RooTV, and Veoh Networks, to name a few.

-They have also signed a distribution deal with ComedyNet.com, for great stand up comedy from NY, and that brings our library to over 1,000 films.

Today's Business Week has an article, which suggests that, YouTube is moving in the direction of revenue sharing model that “could” offer content creators the ability to generate cash. How that will look is still up for grabs and the article quoted Chad Hurley that such a program would go into effect.

“A YouTube spokesperson confirmed the plans Jan. 29, saying, "We are actively exploring a variety of ways to help the community to monetize content.” An announcement could come in a matter of months”.

Of course, unless you have created a Mentos ad or similar fare serious content creators are going to be hard pressed to generate sustained revenue from my perspective, this due to several factors.

-Difficulty in generating sufficient buzz against the hundreds of thousands of other content

-The life cycle for content is getting shorter by the day; this requires content creators to be churning out new content on a weekly basis, this may be fine for stupid videos however, serious content creators have a longer cycle time, which also requires more capital outlay.

While sites like Metacafe claim some producers have earned ten thousand dollars in a few months, this is likely the exception and could be hard to maintain over the long term, also are these serious projects?

The notion that Google is going to place ad content against “thousands of independently produced videos uploaded to its site” is no different then what Revver, Brightcove and other sites are already doing and will require people and not automated systems to check for proper copyright ownership.

Sure YouTube is the 800-pound gorilla and its viewership has captivated advertisers however, will that alone be sufficient to induce what companies are willing to pay in CPM rates?

At the end of the day, if ITV is about offering viewers compelling and diverse content as alternative to the processed food the media establishment has been churning out for years, Indie producers will need an established revenue stream where their content has maximum reach. Right now, I would place my money on companies like Akimbo and NeuLion for the short term.

Time will tell.

photo: Fastweb NOC

As reported in an article in GigaOM, Entitled: Fastweb, IPTV Lessons Learned, Paolo Agostinelli, Chief Marketing Officer for the company had some real world data on how approximately 350,000 customers view IPTV content, Among the companies findings:

-Kid vid is tops, accounting for more almost 50 percent of their VOD consumption

-Triple Play3 ain’t all that — what customers are really looking for is a focused video offering

-Offering 3-day replays of regular TV broadcasts is immensely popular

-The long tail of content (niche programming or Internet video) is still short and stubby when it comes to user acceptance

Fastweb site

As reported in OMMA (subscription required) and the Brightcove's site, the company has secured $59.5M from a number of sources in addition to the New York Times, which is a user of their platform.

While the company has been successful in bringing large companies such as Discovery Channel, Dow Jones, Warner Music, Sony BMG, Reuters, The New York Times and others onboard, it is less clear if small content (meaning: Independent producers) are realizing significant revenues, either via the Brightcove site or across other sites using their platform.

I have contacted the company to speak with individuals for accurate feedback. I know some of the folks at BC and believe they have done a lot to grow the business of ITV and certainly want them to succeed. One of the central questions facing small producers is can they make a living with any ITV platform? Also, will solutions such as those from Akimbo or NeuLion that bridge the gap between ITV and home TV's make it possible for Indie producers to make a living in their craft?

What is critically important if compelling programming like Alive In Baghdad, American Microphone, Daniel Liss, Have Money Will Vlog, The Burg and other's are to succeed will be if can they monetize their content so we are not left once again with only that which mainstream media outlets decide to put online.

If you are an Indie producer and making money using the BC platform, or any other portal, please drop us an email so we can highlight your success.

We have added a new section to the site, which will cover the Mobile space. Specifically, we will endeavor to highlight data and trending information specific to the multimedia aspect (TV/Video, etc...) within the space, this as mobile is poised for explosive growth in 2007.

BusinessWeek has a special section devoted to how business has embraced the use of online video to leverage their brands, reduce production costs, create buzz and energize community

Looking back at the last quarter of 2006, it is interesting to see where the traffic flowed for content viewed. With the Young turning to sites Without Rules, will YouTube and other similar sites for the masses see their influence diminished, or will they morph into a new business model?