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Friday, February 18, 2011

IPDC (Internet Packet DataCasting): The value chain

A promising technology remains only a promising technology if there is no support from the business world. Services such as mobile TV, offer attractive market opportunities for all. But to make it possible, the telecommunications, media and broadcasting industries need to cooperate, exploiting each other’s core competencies. The main actors involved in implementing IP Datacast services include cellular network operators, broadcast network operators, TV broadcasters and media companies.
In this I give highlight into an IPDC value chain, examining the various components comprising this chain; below is an illustration showing the various components making up the IPDC value chain;

The datacast service provider controls distribution of the datacast capacity. Usually, content aggregators buy the capacity directly, either as a long-term agreement for broadcasting annual content or on special occasions to deliver particular content at agreed times (e.g., World Championships). An IP Datacast service provider also takes care of ensuring the protection of available content from illegal viewing. Moreover, in addition to capacity, the datacast service provider controls the Electronic Service Guide. The guide is broadcast along with the content, providing users with information as to which shows and services are available, and at what times. For the consumer, the guide is simply a key to accessing the service, without which watching a show would be just a lucky guess. Thanks to mobile TV, service providers also benefit, obtaining new revenue streams such as advertising and subscriptions.

Next, we have datacast network operators. They own and operate the whole digital broadcasting infrastructure, including mast sites, transmitters, etc. Often, they also happen to be the frequency license holders. Consequently, the companies operating datacast services purchase capacity and coverage from them. One network operator can sell capacity to many service operators, which makes it cost effective. Additionally, by implementing IP Datacast services themselves, the datacast network operators gain an opportunity to generate additional growth from their investment in the digital television infrastructure. Actually, in practice, the two above-mentioned roles are quite often combined. Next we have the
mobile network operators, who will be able to provide interactivity via their networks’ return channels (polls, online voting). Additionally, they will offer billing and e-commerce services to partners, which will generate new revenue streams for them. After all, since the cellular operators already are in possession of large customer databases, it is easiest for them to charge for the services. Following this, a customer receives only a single bill, which is obviously convenient. The cellular network operators also benefit in many other ways. First of all, they will offer their customers a completely new and desirable service, including mobile TV.

Secondly, the revenues will grow thanks to the increased traffic in the network via the return channel (content purchasing, data and web-based services). Finally, to fully exploit the possibilities, the cellular companies may consider building and operating the IP Datacast network, which should considerably enhance their profits. The cellular and e-commerce service provider offers the access necessary for purchasing the content and experiencing the available interactive services. All of this is possible thanks to cooperation with a cellular operator; therefore, it is possible that it will cover this role as well. By provision of e-commerce services we mean selling users access rights to the content (for example, in the form of monthly subscriptions). At the same time, all consumer purchase actions are recorded and passed to a billing system. The revenues are then shared with other parties. Some of the services offered by the cellular service provider can employ only cellular networks. After all, it is not always worthwhile and justifiable to use the broadcast network. This group of services includes mainly those aimed at a particular user (one-to-one services). Examples here would be video-on-demand or purchasing wallpapers or ring tones related to watched TV shows

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