- Broadband TV
- Peers of the realm
- Broadband TV
It sounded such a good idea. Telecom would use its phone lines to offer TV on demand to residential customers over DSL. Here was a potential killer app to bring about the broadband boom we've been waiting for.
Once people have broadband they seem to be reluctant to give it up (cold dead hands syndrome), but there's been a distinct lack of drive to take it up in the first place. While in the long term I don't think we need a killer app (people provide their own content after all - think email, chat, online gaming), it's hard to think of a better app to get the broadband uptake ball rolling than TV. You don't have to explain it; people generally get the idea straight off the bat.
Overseas trials of TV on demand have come up with some interesting results. In April I spoke to Colin Goodwin of Ericsson Australia about TV on demand and in particular a pilot service called "replay TV" that Ericsson is involved in. The free-to-air programmes are stored on a server and for three days after being broadcast they are available for viewing via broadband. Now that's a service I'd sign up for.
Telecom has been trialling JetVideo with 100 households in Auckland. Basically it's movies on demand over your DSL line, but it only ran on full rate JetStream, not the limited JetStream Starter, and most users had the movies pumped to their PC. A lucky few on the trial had movies to a set-top box on their TV, a far more compelling idea. I don't want to sit in my cold little office hunched over a monitor when I've got a big screen TV in the lounge, thank you very much.
The trial's concluded now and Telecom says it won't be rolling out services any time soon. Technical issues need to be addressed, no doubt, as well as an appropriate billing model, not to mention the question of digital rights management. How long do you think it would be before someone figured out how to store and copy movies and start flogging them online?
Instead, Telecom has signed a five-year exclusive content deal with Sky TV, effectively making Sky the only game in town as far as pay TV goes. Telecom's decision to dump Intertainer, the trial content provider, is hardly surprising when you consider that Telecom owns a chunk of Sky, but it would have been nice to see some competition.
Telecom will re-launch its popular "Sky-Fi" deals that saw phone line, JetStream and Sky TV bundled together. It's an attractive deal if, like me, you're thinking about pay TV but don't want to lose broadband access to get it.
Meanwhile, for true broadband TV, with all its control and interactivity, I guess we'll just have to watch this space.
- Peers of the realm
Peering is an odd thing. This is an agreement between ISPs to send traffic back and forth between them without charging each other ISP for the service.
Why do it? Well it makes sense to extend your network to as many users as possible (networks generally speaking can be said to double in worth for every user they add) with as little fuss as possible. If I'm on an Auckland ISP and want to send an email to a user in Dunedin I don't expect to have the traffic routed via Honolulu, bounced off satellites over the Middle East or any other inefficient solution.
To that end there are a couple of peering exchanges here in New Zealand, one in Auckland and one in Wellington. These are effectively black box arrangements. The ISPs pay a monthly fee to connect to the box and are in turn given access to all the other ISPs that connect. This means they don't pay too much for national traffic, everyone's on the same footing and we, the subscribers, get our data sent over the most efficient route.
Of course, not all ISPs are equal, and there are two that are much larger than the rest. Telecom and TelstraClear account for a huge number of users between them and, more to the point, they have built their own networks. Why then, so the reasoning goes, should they not charge other ISPs to use the network? It's cost billions of dollars to build this latticework of pipes; that money has to be recouped somehow. And so it is that TelstraClear is rumoured to be floating the idea of charging ISPs to connect to its network. TelstraClear denies it, but doesn't rule out changing its billing model in the future in an "evolutionary" manner.
I'm no expert on the machinations of telco business models. I look at the mess that is the interconnection agreements between Telecom and the other players over the years and shake my head in wonder at it all. To my way of thinking, peering makes a lot of sense and avoids those same pitfalls we've seen elsewhere. You get traffic on your network, your own network reach is extended, users are getting the optimal routes for traffic and so on. The alternative seems quite troublesome. Some of the system administrators I spoke to are talking of a blanket ban on connecting with TelstraClear should the telco start charging. That would mean traffic to and from TelstraClear customers would take a more circuitous route, possibly out to Australia and back in through TelstraClear's international connections, and we could see bottlenecks forming in new and usual places.
That would certainly make some customers, and I'm thinking of large corporates, sit up and take notice. The idea has been raised that perhaps they would simply ask a couple of the giant US telcos whether they would come to New Zealand and peer with the exchanges in Auckland and Wellington for a low flat rate (around $2000 a month, say) to offer international bandwidth. The corporate customers could then peer with the exchanges themselves and pay far lower traffic costs than they would using local ISPs.
All told it's a tricky one. Surely if you build a network you should be allowed to charge customers to use it? But having said that I'm sure Telecom and TelstraClear aren't about to starve if they don't charge ISPs to connect - they've got all those lovely end user wallets open and at the ready, haven't they?
You also have to wonder whether the telecommunications commissioner would be interested in the matter should Telecom and TelstraClear decide to peer freely between themselves but charge other ISPs for the same service. That would surely raise a few eyebrows in Wellington.