Broadband World Forum in Paris: an overview

Mark Main, Senior Analyst, and Jonathan Coham, Analyst

The IEC's annual European Broadband World Forum concluded on Thursday in Paris. Four days of keynote presentations, plenary sessions, workshops and in-depth speaker panels, plus a vibrant and varied exhibition hall, gave delegates more than enough to select from. We were able to sample a good mix of each and spent a good amount of our time talking to as many solution providers and their customers as we could fit in.

We didn't sense many earth-shattering announcements, but it was clear that the concept of the fully networked home - distributing content and making services accessible around the home - is becoming a key issue, particularly for those telcos with growing numbers of IPTV customers. The exhibition featured numerous vendors with a vast number of products and solutions designed to address the opportunity. We spoke with numerous players tackling various issues and opportunities and it is clear that there are a number of technology and business issues yet to be resolved. Ovum's new Connected Home service, being launched next month, will address many of these themes over the coming months.

There was, of course, the ongoing discussion around fibre in the access network - how much and how quickly FTTx would be installed in Europe, noting the recent situations highlighted in France, Germany and the Netherlands with their respective operator plans for next-generation network (NGN) access. The 'open access' model is starting to find some favour, however the issue of how certain types of fibre deployment of players with SMP could be unbundled is still unresolved - even though the problem is clearly foremost in peoples' minds. ARCEP (the French regulator) seems to prefer a specific architecture (AON) to overcome this, whereas other regulators such as Ofcom in the UK wish to remain technology neutral.

In other debates there was plenty of reference to content delivery via both telco IPTV and Internet video - all prefaced, of course, in the context of the recent Google/YouTube announcement. Content owners want to move to a slice-and-dice 'licensing to the individual, for life' model, which will surely meet a brick wall when it comes to many of those already actively engaged in content sharing. In addition to the difficulty and relative unwillingness of many of today's service providers to address the 'long tail' of content, the middle segment (which needs a name!) also came in for critical assessment - how do small and mid-size independent producers bring their offerings to market in the on-demand arena? Arjang Zadeh's (Accenture) keynote on Monday evening reminded IPTV players to keep offerings simple and compelling, and to work progressively, rather than expecting rapid success. Such caution and prudence is probably correct from an operator business perspective but it may frustrate the smaller-scale content producers, which will need to seek alternative channels to market. Overall, the conference sessions reflected a more objective view of IPTV and its merits, confirming that - at least in the early years - IPTV largely represents a market-specific opportunity for revenue generation. We remain unconvinced that some advanced features really are as value-added as they are represented as being - in the same way that spam filtering, anti-virus and content access control never really generated much additional revenue for ISPs. In the 'simplicity model' for IPTV, these features should be included as ordinary service enhancements - when the time is right.

Understandably, there was more than the occasional reference to 'Web 2.0' (which we find has many different definitions and meanings). In a keynote, Korea Telecom proposed a new 'Telco 2.0' activity (and, as an aside, we notice there is now growing use of the term 'VoIP 2.0' - the '2.0' label is infectious indeed!). At a superficial level it seems that much of the '2.0' label can be thought of as jargon to describe what is really little more than a technology shift towards IP-enabled services in various markets and that, in truth, there hasn't been any quantum leap in thinking or business activity. However, in his Keynote, Jong-Lok Yoon of KT called for the creation of a new 'Telco 2.0' forum within the IEC to foster collaboration around what he called new value-creation activities, based on communications infrastructures. In doing so, Yoon suggested a new co-operative venture encompassing the equipment vendors, the telcos and the Internet giants - based on a series of working groups that would help telcos to transform their ailing businesses from legacy to new business paradigms. However, we note that there are a growing number of established '2.0' initiatives in the telecoms space under various names. Is there not a danger of dilution of effort and confusion through the creation of yet another forum? More to the point, how much do the 'Internet giants' really want or need to collaborate with the 'old guard'?

Finally, but by no means least, major equipment vendors as usual had a strong presence at the event, offering an optimistic stance for IPTV, triple play and IMS. Interestingly, however, there was a clear theme of increased consumer and service orientation. We were given examples from two of the major equipment vendors, where consumer research featured clearly in product strategy, fitting conveniently with an obvious shift to managing the end-to-end deployment of services and infrastructure. This places such vendors even more aggressively into the systems integration and professional services space, to avoid the trap of becoming mere providers of products with eroding margins. This means that the edge they are looking for will require the deployment of increasingly complex systems that deliver the expected benefits to service providers first time, each time. A future clash of businesses? You bet.

Mark Main is a senior analyst with Ovum and has 25 years' experience in the telecommunications industry. He specialises in the exploitation of network technologies and their impact on new network services and architectures.

Jonathan Coham is an analyst for the Broadband@Ovum advisory service, which provides analysis of broadband markets and operators. Jonathan's contributions include operator strategy, regional competitive analysis, forecasting and reports on next-generation networks.