We have just published a report that addresses the lackluster performance of IPTV of late.  Seems only five years ago that analysts were predicting IPTV would become the next big thing, and a threat to “traditional” pay tv platforms.  Much of this has failed to materialize, and we—along with others—have downward revised our global IPTV estimates.

In short, IPTV has failed to live up to its promise.

Steep Road Ahead for IPTV

IPTV has a few hurdles ahead of it, one of which I refer to as the “interactivity gap” in the report.  There has been much talk of “interactivity,” but little actual progress.  Sports scores, stock tickers, and traffic widgets are all well and good, but are unlikely to compel many consumers to sign up.

People like to talk about the great things IPTV can do, but few can point to actual implementations of interactivity or examples of services that customers actually want and are willing to pay a premium for.

No More Hotspotting Demos.  Deal?

Some things just won’t go away

Along with cargo pants and Dancing with the Stars, the so-called “Jennifer Aniston’s sweater” trade show demo keeps coming back season after season.  The somewhat cynically-dubbed example refers to a mocked up demo that was all the rage back in, well, about 2003.  In it, a fully-engaged and immersed tv viewer, ravenous for more information on the article of clothing a tv celeb is wearing can, at the push of a button, be transported to an information page and a t-commerce opportunity.  Cha-ching!  Right?

Not really.

As recently as 2 weeks ago, I was forced to endure another hotspotting demo at the National Association of Broadcasters (NAB show in Las Vegas.  The celebs were updated (somewhat), but the hackneyed concept is the same.  And so is consumer and service provider interest.  And by “the same,” I mean “nonexistent."  It has become a punchline in the industry.

IPTV providers need to find interactivity that consumers actually want.

Address Addressable Advertising

Another often-mentioned hallmark of IPTV is the concept of addressable advertising, a laudable idea that has yet to emerge on any scale.  All hope is not lost, however.

The recent announcement that San Jose-based BlackArrow, an advanced advertising vendor, generated an additional $20 million in funding should be seen as positive for the future of IPTV. While NDS Group led in this round of financing, others backers include ecosystem heavy-hitters including Cisco, Comcast and Intel. In total, the firm has raised just shy of $60 million. In an associated announcement, the two companies said they would be going to market together with the “first truly end to end” solution in the industry.

Will barrels of cash and high-profile backing be enough?