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ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Key Success FactorsKey Success Factors………….Beyond IPTV.Beyond IPTV
Paul Berriman PCCW12th October 2006
International Telecommunication Union
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
now TV – Introduction
Performance to date
The Future: Interactivity and Home Networking
The Platform and capabilities
Content and Marketing
Strategy and Integrated Services
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
now TV – Introduction
Performance to date
The Future: Interactivity and Home Networking
The Platform and capabilities
Content and Marketing
Strategy and Integrated Services
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
7M population, multi-lingual, mainly Chinese speaking
World’s 2nd most developed broadband market with more than 1.6m accounts – about 60% household penetration
Mobile penetration over 100% with 3G launched in 2003
3.8 million telephone lines
4 pay TV operators, 5 fixed operators, 5 mobile operators
Hong KongHong Konga Leader in a Leader in TechnologyTechnology and and CompetitionCompetition
2 free to air broadcasters with 4 channels (2 Eng + 2 Chi)
Over 50% pay-TV penetration
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
650k+ installed customer base in 3 years
25% of Households
High quality platform
Innovative pro-active marketing
CASBAA Chairman’s Award 2004
IntroductionIntroduction
Significant benefits to broadband businessBroadband Churn halved to <1%
Over 110 TV and audio channels
Growing array of new Interactive services
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Sustained MomentumSustained Momentum
Pay Channel Customers & ARPU
Pay channel customers as % of total installed (HK$/ month)
2003 2004 2005
Steadily rising ARPU as new content introduced
2006
73%71%61%
53%39%
20%
118114110105
7057
0%
100%
H2 H1 H2 H1 H2 H10
30
60
90
120
Mini Packs launched
Strong Demand for
InstalledPay channel customers
Residential
CommercialInstalled pay channel services
2003 2004
29106
147
269
H2 H1 H2
361
182
10
10
192
441
H1
254
17
17
271
H2
2005
549
369
39122
22
(’000)
+38% y-o-y
+38% y-o-y608
444
2006H1
26
26
418
Reached 654,000
at end of August
Reached 654,000
at end of August
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Growing penetration rate of among consumer NETVIGATOR
Maintained low churn rate of consumer NETVIGATOR since launch
Dropped by half
Jun-05Before launch
H2’03 H1’04 H2’04 H1’05
Strategy is WorkingStrategy is Working
28%
48%
59%53%
68%
Broadband Lines Continue to Grow
460
5863
68
8894
840
517558
660715
798
8074
H1 H2 H1 H2 H1 H2 H1
629703
753 796
2003 2004 2005
857
WholesaleBusinessConsumer
953+16% y-o-y
+16% y-o-y(’000)
998
2006
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Expanding the Pay TV Market by More than 60%Bringing Quality Entertainment to More ConsumersBringing Quality Entertainment to More Consumers
Expanding the Pay TV MarketExpanding the Pay TV Market
Expanding Pay TV Market
HK Cable TV
13 YearsCustomers 740K
@20% Piracy3 Years
Customers > 650KZero Piracy
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
now TV – Introduction
Performance to date
The Future: Interactivity and Home Networking
The Platform and capabilities
Content and Marketing
Strategy and Integrated Services
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
now TV – Platform
TV Headend
Hong Kong Head-End
Production
Satellite, or Fibre Optic feed
Content feed
Tape
Hong Kong LocalTelecommunications ExchangesLinked by Fiber Optic Cables
Local exchanges
EncodeMPEG 2
Subscriber Management SystemBilling SystemRating Database
DSLAMCAU
ConditionalAccess Unit in DSLAM in Local Exchange
Decryption
Encryption
Hong KongCustomer’s Home
Modem ->TV SetTop Box
Customer’s TV
PLATFORMPLATFORM6 Mbit/s ADSL to over
93% of Households overexisting copper
Custom Network Based Conditional Access Unit
in DSLAM
Low Cost Digital Decoder Based on DVD Chipset
End to End Dynamic Key encryptionWith/Without DVD
Auto Software Upgrades
Web Browser & Web Server Based EPG
with On-line SubscriptionManagement & Billing Enquiry
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
High quality picture with NICAM digital soundAbility to offer multiple language channels
Digitial encryptionNo geographic overspillFirewalled from internet
Installation easy and targets feasibleGrowing interactivity and integrated services
>990,000 Broadband Customers to Upsell
Scaleable Network with Large Channel Capacity and “Add-Ons”
HDTV in commercial service by end 2006
Viewer reporting – time of day viewingABC Asia Pacific - Reach Rate - Sep-Nov 2005
0.000%
0.020%
0.040%
0.060%
0.080%
0.100%
0.120%
06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 00 01 02 03 04 05
Mon-Fri
Sat-Sun
Overall
Secure platform – network based CAU
PlatformPlatform
Zero Piracy – Revenue Assurance
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
now TV – Introduction
Performance to date
The Future: Interactivity and Home Networking
The Platform and capabilities
Content and Marketing
Strategy and Integrated Services
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Flexible Pricing OptionsFlexible Pricing Options
14NAMinipack (choice of 8 pay channels with selected genre mix)- Larger packs available
1 – 8 each1.5 – 10 eachPay TV content (per channel)10**NABroadband plus pay TV only20*NABroadband plus Internet plus pay TV2030Broadband plus Internet access
12 Month Contract
(approx.US$)
Monthly(approx.US$)
Service
•Installation and STB charges waived plus 17 free channels** Customer must have minimum pay channels
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Pay TV is about watching great TV content…
All genres:
Local / localisation
ContentContent
Mass & niche Some great exclusiveness
Travel & documentary,Movies & drama,
電影預告頻道
Foreign language, AdultTVB Pay Vision,Sports,Entertainment & Music,Kids,News & Information,
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
The Movie HouseThe Movie House
Long term exclusive arrangements – 2011
& 2014 with STAR and HBO
Continue to strengthen local content
including exclusive Mei Ah Movies & STAR
Chinese Movies
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Easy to use EPG, parental control, bill viewing, previews, barker…
“Arm chair” proposition… buy on screen, check bills on screen
Flexible “a-la-carte” channel / “a-la-carte” pack pricing structure
Recognition that content providers have fantastic brands
Mass / CRM based marketing - internal: shops, call-centre, EDMs, promos / barker channel and external: road shows, TV, radio, print, bill-boards, busses, door-to-door…
Comprehensive channel proposition with high quality picture
now TV Marketing ….. Maintaining Momentum!
MarketingMarketing
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
A la carte proposition – low entry pointUnique flexible pricing
Unique flexible pricing
From 23 to 90+ channels in just over 24 monthsEnrich content
Enrich content
More exclusive
deals
More exclusive
deals
Jan-06Mar-04 Nov-04Sept-03 Oct-05
Marketing Strategic RoadmapMarketing Strategic Roadmap
Mass market
packages
Mass market
packagesChinese Content Platform
Mini-packs drive up ARPUDrive ARPU
Drive ARPU
$388 Super Value Pack
Ticketing, now SelectInter-activity
Inter-activity
Marketing …. Maintaining Momentum !
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
now TV – Introduction
Performance to date
The Future: Interactivity and Home Networking
The Platform and capabilities
Content and Marketing
Strategy and Integrated Services
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
AccessConduit (POTS, Basic
Broadband)
Own content (e.g phone calls)
Separate networks and billing
PCCW Business TransformationPCCW Business Transformation
Unlocking CapabilitiesSecure third party contentManaged high bandwidth
Network and BillingTrusted partner
Increased stickiness
Extending Value Chain
ContentApplicationTransactions
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Customers Access Integrated Services through Customers Access Integrated Services through Quadruple Play on an All IP Core NetworkQuadruple Play on an All IP Core Network
Access to valuable content and transaction revenues will be via multiple access technologies for a number of customer situations, devices and
experiences, fixed, wireless and mobile
Mobile Cellular2G/3GBroadband
WirelessWireless
Home/OfficeWired
Broadband
Wireline
Content Applications & Transactional Services
Access Layer
Content Applications & Transactional
ServicesIP Core Network
Telephone MobileTV PC
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
PCCWPCCW GroupGroup
Fixed LinePay-TV
Broadband&
ISP
Mobile
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Quadruple Play Quadruple Play Complete Platform for Integrated Services
Pay TV
654k subscribers, up 38% y-o-y
HDTV in trial
Fixed-line
Continued line gain
Market share returned to 68%
998k lines, up 16% y-o-y
music library launched
Broadband
Mobile
Migrating PCCW 3G trial users
Launched Mobile TV
Plus: TV Content + ISP Portal Content + Mobile Content
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
now.com.hk
Video clips of all 125 games
Content includes preview, match highlights, etc. from
Broadcasting 77 games live
Simultaneous broadcast up to 4 games
All 125 games on demand on
Broadcasting all 125 games live
/ jointly developed UEFA Champions League on-line Challenge Games
On All Platforms Began September 13
Content on Multiple Platforms:Content on Multiple Platforms:UEFA Champions League SoccerUEFA Champions League Soccer
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
onon
• Exclusive content made available to customers
• Utilizing CMB technology, content can be broadcast more efficiently and to a large group of users
• Initial programming will include local & international news, finance & sports:
• Other entertainment and infotainment will be available soon:
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
now TV – Introduction
Performance to date
The Future: Interactivity and Home Networking
The Platform and capabilities
Content and Marketing
Strategy and Integrated Services
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006 Time
HDTV
MPEG4Home networkingMultiple TVs
Evolution from Basic Evolution from Basic Broadband to HD IPTVBroadband to HD IPTV
AdvancedInteractivity
Media serverNetwork based personal video recorderReplay/ timeshiftOn-demandInteractive advertisingTransactional services (e.g. Movie Trailers/Cinema Ticketing)Casual games“Side” Channels including ESPN Plus and HBO UncutMOBILE TV
BasicInteractivity
Electronic program guideOnline subscriptionOnline billingTraffic & weather channels95 channels (ESPN, ATV, drama)Mini-packages 23 channels
a la carte modelMPEG2Broadband
InternetToday
2006 STB with H.264 for HD @ 8 Mbit/s
plus MPEG2 for SD
IP TV
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Broadband AccessBroadband AccessDevelopmentDevelopment
Early ramp up of fiber to the building/ kerb
Early ramp up of fiber to the building/ kerb
6Mbps6Mbps
8Mbps8Mbps
18 - 25Mbps18 - 25Mbps
85%
93%
Per
cent
age
of T
errit
oria
l Rea
ch (%
)
50%
ADSL to 8MbpsTo 50% from
exchange
ADSL to 8MbpsTo 50% from
exchange
Via FTTB + ADSL2+ and
VDSL
Via FTTB + ADSL2+ and
VDSL
Dedicated Managed
Bandwidth with Q.o.S.
NOT SHARED!
Dedicated Managed
Bandwidth with Q.o.S.
NOT SHARED!
introducedintroduced
TimeToday
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
now HD
New Interactive ServicesNew Interactive Services
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Movie Trailer ChannelMovie Trailer ChannelOnOn--Line Ticket Booking via IPTVLine Ticket Booking via IPTV
Hong Kong’s first-ever instant box office on TV through partnership with UA Cinemas and Cityline
Customers can preview theatrical trailers then pick the seats and purchase tickets from UA Cinemas by clicking on the buttons on their remote controlMore customers using Movie Ticketing than Cityline on Internet
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
New Interactive ServicesNew Interactive Services
A selection of casual games for the whole family
Currently 8 games on free trial for high ARPU customers
Major enhancement by November ’06
the place to shop
Interactive shopping mall
DVDs/Books, Kids/Sports, Leisure, PCCW Products, Bargain Corner & more
Stock Market Express – Real Time Quotes
Stock quotes, FX spot rates and gold prices
Transactional capabilities to come
Mall out of the box!!
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
Experience Gained:Experience Gained:Some Key Success FactorsSome Key Success Factors
• Start with large Broadband Customer Base enabled by Bandwidth everywhere and low cost STB decoder
• Award winning customer relationship management with proactive outbound call centre telesales. Cross Selling-Upselling. Not Bundling
• A La Carte as competitive entry strategy, migrating to “mini packs”retaining choice
• Wide choice of content, some “killers”, some exclusives
• Constant progress monitoring and marketing initiatives which evolve to keep up the momentum.
• Protect Content Providers Rights – Zero Piracy, Revenue Assurance– Become Trusted Partner – for customer and content provider
• Quality Picture, better than Cable and Easy to use Customer Interface with phased introduction of interactive services
• Strong “in-house” capabilities for network/systems development and Installation
ITU-T
ITU-T IPTV Global Technical WorkshopSeoul, Korea, 12-13 October 2006
PAUL BERRIMANPAUL BERRIMANHead of Strategic Market DevelopmentHead of Strategic Market Development
PCCW PCCW LimtedLimted40F PCCW Tower40F PCCW Tower
TaikooTaikoo PlacePlaceQuarry BayQuarry Bay
HONG KONGHONG KONGTel +852 90241312Tel +852 90241312
Email: [email protected]: [email protected]
International Telecommunication Union