1 IPTV BC en IPTV Industrial Background 1 PPT 201008(Draft) 55p

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IPTV Industrial BackgroundIPTV Industrial Background

Contents

IPTV- A Global Review

IPTV In Europe FT OrangeTV IPTV- In Europe- FT OrangeTV

IPTV-In America- AT&T U-VerseTV

IPTV- In Asia- PCCW nowTV

IPTV- In Asia- China Telecom BesTV

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Challenge -Chance for Telecom Operators

Evolution of New operation technologies

Declining Voice & Data Revenues

Convergence of Telecom, Internet, Media and Entertainment

Growing broadband network

Pipe operator or Service Provider, this is a question

IPTV is a Suitable Cut-in Point

Broadband Service enables new service opportunities

Video Services are dominating

Broadband users desires higher QoE on video services

Network operators transfer themselves to a broadband services provider

New Revenue Streams with Minimal Investment

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Source: IPTV Forecast MRG 2008/2009

75

100

Mil

lio

ns

Global IPTV Subscribers--2008-2012

0

25

50

Glo

bal

IPT

V S

ub

scri

ber

s©

MR

G, I

nc.

200

8

Source: IPTV Global Forecast © 2008 MRG, Inc. 24mn in 2008 to over 90 mn in 2012

2008 2009 2010 2011 2012

Total 24,006,800 37,363,500 52,016,700 70,891,077 92,800,066

ROW 647,500 1,171,000 1,790,000 2,769,056 3,753,915

North America 4,570,000 6,772,000 9,585,000 13,065,475 17,343,082

Europe 10,728,400 16,008,100 21,537,600 28,310,805 36,285,865

Asia 8,060,900 13,412,400 19,104,100 26,745,741 35,417,204

US$ 9.7bn in 2008 to US$ 25.6bn in 2012

The IPTV Promise

Push - LinearC bl S t llit

Pull -On-demandN C tit

Traditional TV IPTV

Cable or Satellite National & Regional Location-specific services

Time restriction

New Competitors Personal, Social Any content to any device

TSTV and TVoD, Killer application

Triple-play Traditional TV business

models

Enables Multiple-play Enables new business

models

“Schedule-free TV, on your terms”

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IPTV is Happening

10.7 Millions

8.4 Millions

4.9 Millions

Source: IPTV Forecast MRG 2007/2008

24 Million subscribers at the end of 2008

Contents


IPTV- In Europe- FT OrangeTV




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IPTV Market in France

There are five IPTV services providers in France: Orange, Neuf Cegetel, Free, Alice and SFR (Tele2)

Orange TV- Introduction

Achievements Orange TV had 1.9 mn subscribers in France by the end of

2008

Th t l h d t t l f 2 1 TV b ib The telecom had a total of 2.1 mn pay-TV subscribers across its European operations by the end of last year, up 66% from the end of 2007

Orange reports that its content services continued to experience rapid growth in France, with domestic VOD downloads more than doubling in 2008, rising from 5.1 mn in 2007 to 12.1 mn in 2008

Service Model

FTTX-based triple play bundle with speeds of up to 100 Mbps

France Telecom is also deploying a satellite TV service to reach areas where TV is not available via DSL

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FT IPTV Technology Ecosystem

Supervision

S itSecurity

Middleware

Platform

STB

FTFTcomponentscomponents

Sofrecom

Int’l d

eplo

Sofrecom

Int’l d

eplo

FT

Integration

FT

Integration

DSLAM

Head-End

oyment

oyment

nn

There are 4 key content areas to address

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IPTV International Footprint

UK

Open Markets France,

Spain,

Poland,

Mauritius, Senegal

Ongoing projectsUK Sl ki

FRANCE

POLAND

SPAIN

Ma riti sSenega

Slovakia

UK, Slovakia

Others Mobile presence: Romania, Switzerland, Belgium, …

Countries with no FT presence handled with Sofrecom

MauritiusSenegal

Orange TV Strategy: "Content Everywhere"

differentiate from access competitors

acquire and keep

broadband customers

develop ARPU

develop audienc

e

PCTV

grow advertisement

Grow direct pay content and airtime

mobile phone

revenue

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Classification of TV Services Live TV

Full Triple Play Offer

200+ Live Channels

Standard Bouquet: 63 Channels 5 HD

Special Features

- Time Control

Ti Shifti

24/24 Orange VoD 2500 Films

5000+ TV program

Pay per view 63 Channels, 5 HD

Orange Sports Channel

Premium Bouquets

Thematic Bouquets

Internet TV

Orange 15M unique visitors / month

2Bil visited pages / month

- Time Shifting

- PVR

- Multi-Screen

y

Subscription VoD

HD content

Mobile TV (Edge, 3G, 3G+)

Coverage: 95% of the Population

6.3M users

Live TV: 63 Channels 2Bil. visited pages / month

24/24 Video (VoD)

2500 Films

5000+ TV program

High Definition

Orange Sports Channel

Live TV: 63 Channels

VoD: 3000 Video

32.5 M video/TV sessions *

* Semester 1, 2007

IPTV Service Overview

Main services components: Television service

VoD “video store”

Access to HTML pages (web technology)

presentation portal, service related data

Main features: 3000 on demand films & programs

250 live TV channels in HD & SD

2,37M LiveBox users

Exclusive Sport (e.g. 7 R. Carros channels)

Dedicated Music channels (e.g. Madonna)

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Contents






U-Verse Service Model

AT&T U-Verse TV Up to 360 channels, includes local 105 HD programming channels and growing Total Home DVR service Store up to 233 hours of SD or 65 hours of HD shows AT&T U-Verse High Speed Internet Wireless Internet router, wireless networking service Downstream speeds up to 18 Mbps available Voice Digital home phone serviceg p AT&T U-verse Messaging (SM) Broadcast voice messages Call History On PC Screen and Incoming calls on TV

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U-Verse Ecosystem

Head-End

DRM

Middleware

DSLAM

SetTop-Box

U-Verse Statistics

AT&T reported a record 284,000 AT&T U-verseSM TV subscriber net additions in the first quarter to drive the U-verse TV subscriber total above 1.3 million in 2009million in 2009

U-verse TV is now available in 93 markets across 19 states

AT&T U-verse fiber network passes nearly 18 million living units

Customer demand is growing as AT&T expands availability and introduces service enhancements

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U-Verse Subscriber Trend

Nearly 50 percent of AT&T U-verse TV subscribers take one of the two largest video packages

More than 90 percent of U-verse TV customers bundle with High Speed Internet

More than 75 percent of U-verse TV customers have a triple- or quad-play

U-verse Voice services are now available in 80 markets.

U-Verse Features

Mobile Remote Access to DVR，any Internet-connected computer or compatible wireless device

Built-in Picture-in-Picture You can channel surfing without missing a minute of the program you are watching by using the Picture-in-Picture browse feature

AT&T U-bar The U-bar allows you to access customizable stock, weather, sports and traffic information on your television screen, based on preferences set through the AT&T portal

Four stream DVR recording You can record up to four shows at once

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U-Verse Features

Local Yellow Pages search, YELLOWPAGES.COM TV gives you an intuitive new way to search your local Yellow Pages directory on your television screen

Yahoo! Games You can play your favorite games on your television screen, including Sudoku, JT’s Blocks, chess, and so on

Advanced program guide, easy access of programs including title, time remaining in the current program, cast and crew. Parental control, etcetc.

AT&T Online Photos You can simply and conveniently watch slideshows and browse your online photos right from the comfort of your couch, on your U-verse TV screen

Contents






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NowTV Info

NowTV, launched in 2003 and widely regarded as one of the world's most successful commercial deployments of IPTVIPTV

NowTV is the largest pay-TV Service in Hong Kong with 927,000 subscribers at the end of 2008

Viewers may choose from more than 160 channels

Watch now TV programming not only on a TV set, but also on a mobile phone, an online PC, or on fixed-line home multimedia device, branded PCCW eye

AGENDA





IPTV- In Asia- China Telecom BesTV Shanghai Telecom (BesTV)

Jiangsu Telecom (BesTV)

User Analysis

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Evolution of China IPTV

Sprout Breaking i

Frustration Progress Turning to b tt

2005 2006 2007 2008

• Globally, IPTV service is evolved from experimental stage to commercial use stage.

2004 2005

ice better

• Issue the first IPTV license

• Commercial trial in Harbin and

• IPTV commercial services are started by the most of the main operators in

• The size of China IPTV subscribers increased greatly, over 800,000 users

• After years of development, there is a large amount of IPTV subscribersg

And at the end of the year, PCCW has 480,000 IPTV subscribers

• There are over 10 million broadband users in China and IPTV goes to experimental stage

in Harbin and Shanghai

Europe

• Only three IPTV licenses issued in China

•IPTV service was banned by regional administrations in different areas

• The regional administrations request that IPTV service should notbe banned by SARFT. And there is fast development in digital TV switching

•The 2008 Olympic Games in Beijing provides opportunities for IPTV

•Telecom operators reformation, a new pattern formed

.

Development of China IPTV Users

There are about 2.2 million IPTV users in 2008. There will be 2~2.5 million more users in 2009.

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Construction of FTTx Based on EPON Guaranteed Bandwidth China Telecom

Deployed more than 10 million EPON user ports in 2008: Most ports are FTTB and a few portion of FTTHMost ports are FTTB and a few portion of FTTH ports, providing 8M and 20M typical bandwidth options

In 2009, China Telecom will go further in broadband-accelerating strategy and related constructions based on EPON

China Unicom In 2008 China Unicom only applies a small scale of EPON In 2008, China Unicom only applies a small scale of EPON

In 2009, China Unicom starts the "Broadband-accelerating" strategy based on EPON. In June, it purchases 11 million EPON lines totally.

Construction mode and service capability are consistent with China Telecom.

Wireless Broadband Pushes forward IPTV Service

January 2009, China releases 3G license. March~June, China Telecom, China Unicom and China Mobile Communications Corporation start 3G commercial application. The competition for the wireless service will become the key point between the three main operators.

Based on IPTV platform, China Telecom will provide mobile handset video services through 3G wireless broadband.

The three-screens-in-one (PC screen, TV screen and mobile handset screen in one screen) service will become the most popular operation mode among China operators.

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AGENDA







User Analysis

China Telecom is the world’s largest wireline telecommunications and broadband services provider,with about 210 million fixed line subscribers and over 40 million broadband subscribers.

Shanghai Telecom is a subsidiary of china Telecom, contains about 3 million broadband users.

Launched in Sep 2006 Total 800 000 IPTV subscribers (Jan 2009)

Shanghai, Shanghai Telecom Introduction

Shanghai-------Largest city and economic center of China

Launched in Sep.2006. Total 800,000 IPTV subscribers (Jan 2009)

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Shanghai IPTV Eco System

Head-End

Middleware

DSLAM

SetTop-Box

Tele-votingKaraokeGaming

TV Shopping

Web portalsTV yellow Pages

StockWeather

Government Online

Launched IPTV Services in Shanghai

Key Focus:Video service

QoERevenue opportunity

VOD (PPV)TVOD (3 Days)

NVOD

Government OnlineTV-Bank

Remote Education

Live TV (108 ChannelTSTV (60 Min.)

Olympic Game Column

Video Phone/ConferenceUnified Message

Hotel IPTVHotel IPTVGlobal Monitoring

ZTE STB

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IPTV Enables Premium $Content$

39%38%40%

收视比例传统电视 IPTV的节目Traditional TV IPTV

Percentage of Viewers

7%

25%

16%14%

8% 8% 8% 10%10%

20%

30%

Data from Shanghai Media Group - SMG

2%4%

2%5%

2%0.02% 0.36%1%

8%

0 0.10%0%

10%

电视剧电影少儿娱乐纪实财经体育法治游戏新闻

Comparison of Traditional TV and IPTV Viewers

Sitcom Movie Kids Entertainment Social Financial Law Sport Game News

IPTV Value-Added $Service$

Example: Dance Competition 2006

Voting rate of IPTV viewers (with remote controller)

was 25 times as high as that of cable TV viewers (using

SMS to vote)

Same viewing period:

100 000 i 000 %100,000 IPTV viewers: 5,000 votes 5%

20,000,000 CATV viewers: 40,000 votes 0.2%


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Revenue Sharing with CP and SP

SMG Shanghai Telecom

SP

•IPTV service provider provides network infrastructure, service provision, and hosts all value-added services;

• Content provider converts video formats and manages all video contents (including media sharing part)


IPTV Charge Strategy of Shanghai Telecom

Phase III

Phase II

Phase I

2007, IPTV binding with broadband: Users focus on broadband.

2008, sales-promotion on IPTV charge: charge free for over 8 times usage within a month together with

2009, monthly payment pre-paid: cultivate a good payment habit ,it is nearly one million IPTV users

Although the number of IPTV users increases fast, the usage ratio of IPTV STBs is very low.

month, together with VOD and TSTV ，achieve quite positive reputation from IPTV users.

Z30

Slide 38

Z30 TSTV,Alwin, 10/25/2010

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Shanghai Telecom's IPTV and Broadband Users Penetration Rate

IPTV Penetration Rate19%

2008.3

2008.5

2008.7

2008.919%

8%

Broadband user IPTV user

2008.1

8%

Relationship of Shanghai Telecom and SMG

User

Shanghai Telecom

SMG

CP/SP of non-Video VAS

CP/SP of Video VAS

CP/SP of Video Service

STB Provider

Content Service Access Service STB Order

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• Broadband Penetration• Large broadband user base: 3 million subscribers with high loyalty

• Sufficient bandwidth: up to 4 Mbps on average

Shanghai IPTV Success Factors

• Sufficient bandwidth: up to 4 Mbps on average

• Content Variety and Appeal• Win-win partnership with SMG on content acquisition

• Compelling and competitive content to attract users

• Different contents including TV programs from Hong Kong, new release movies

• Convenience with TSTV & TVOD: watch TV at any time

• Value added services increases the profit• Value-added services increases the profit

• Marketing Promotion• Annual pay (only pay for 10 months- 2 months free)

• Discount when bundling with E-Home services

• Free STB for two-years contract

AGENDA







User Analysis

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Jiangsu & Jiangsu Telecom Introduction

Rank in China(Population)

Administrative Division

PopulationComparable

country

— China 1,301,531,000China 1,301,531,000

5 Jiangsu 76,245,000 Egypt

Rank in China(GDP)


In million RMB In million US$

— China 20,940,700

3 2,556,010 335,964

Jiangsu Telecom, a subsidiary of publicly-listed China Telecom, thelargest fixed-line telecom operator in China, has become a major playerin broadband services, serving more than 3.3 million broadbandsubscribers

Project Profile

I 2006 j t t d l dIn 2006, project covers most developed cities in Jiangsu province, and it has about

100,000 subscribers

In the first half of 2007, the project was expanded to cover 13 cities of the province

Nov, 2005 ZTE beats UTStarcom, Alcatel and Bell

ZTE is a sole provider

Z35

Slide 44

Z35 province, and Alwin, 10/25/2010

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Jiangsu IPTV Eco System

Head-End

Middleware

DSLAM

SetTop-Box

Launched IPTV Services in JiangsuVAS

KaraokeInformation

B

System Functions

Multiple CP/SP Access

Customized EPG

Video & Audio

Services

Live TVVOD Browser

Tele-votingGame Hall

Online/Offline Game

Video SurveillanceVCS Live

Advertisement Insertion

… …

Customized EPGVCDN

Live Relay Group User

FunctionRe-operationChannels Mix

Integration with hotel’s system

Hotel’s Solution

VODTSTVTVODNPVRNVOD

ITVVirtual

Channels

… …Self-care Service…

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Contents






China Telecom is the world’s largest wireline telecommunications and broadband services provider,with about 210 million fixed line subscribers and over 40 million broadband subscribers.

Shanghai Telecom is a subsidiary of china Telecom, contains about 3 million broadband users.

Launched in Sep 2006 Total 800 000 IPTV subscribers (Jan 2009)

Shanghai, Shanghai Telecom Introduction

Shanghai-------Largest city and economic center of China

Launched in Sep.2006. Total 800,000 IPTV subscribers (Jan 2009)

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Jiangsu & Jiangsu Telecom Introduction

Jiangsu is a province of the People's Republic of China, locatedalong the east coast of the country.

Rank in Chi

AdministrativP l ti

ComparableChina

(Population)


PopulationComparable

country

— China 1,301,531,000

5 Jiangsu 76,245,000 Egypt

Rank in China(GDP)


In million RMB

In million US$

— China 20,940,700China 20,940,700

3 2,556,010 335,964Jiangsu Telecom, a subsidiary of publicly-listed ChinaTelecom, the largest fixed-line telecom operator in China,has become a major player in broadband services, servingmore than 3.3 million broadband subscribers

Behavior Analysis of China IPTV Subscribers

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Attraction of Different IPTV Contents

Will you recommend IPTV to your friends?

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Marks of IPTV User's Satisfaction

Global Summary

Large Number of subscribers shows successful IPTV deployment

Huge Revenue is generating and expected to be more in the future

Future Plans are aggressive

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Documents

1 IPTV BC en IPTV Industrial Background 1 PPT 201008(Draft) 55p