My Gmail alerts are full of IPTV and WiMax news. I'm tired of both. WiMax doesn't really exist yet and IPTV is a limited idea. Here's why IPTV is a limited idea:
TV is the only medium where the consumer generally has a choice:
- rabbit ears
- the local cable franchise
- 2 satellite TV companies (DBS from DirecTV and DISH)
- The Web: iTunes, direct from the network website, and other places, and
- soon, at least, in the NFL cities, you will have VZ or T offering something called IPTV.
But here's the funny part: it's a static pie. It's all about price at this point, because the channel choices are very similar. So the Bells are going to spend billions to split up the pie with cable and DBS. Gary Kim remarks:
But there's an important principle here. If one totes up the actual revenue any telecom provider can generate from video (ARPU is nice, but gross margin for an entertainment product has to be sliced in half to figure out what "gross revenue" actually is for a service provider), and then compares that to what a service provider can lose from current voice and data, the potential loss from voice and data is a larger number than the potential gains from new video services. That isn't an argument against providing video. It is an argument for not getting defocused on core data and voice revenues. That's where the money is. [emphasis added by me]
Even Wall Street is looking for proof in TV strategy, as the Washington Post writes.