IP Capsule E-Newsletter, April 13, 2007

Thu, 04/12/2007 - 8:00pm
IP Capsule from CED Magazine
   April 13, 2007
IPso Facto...

Widevine mutates DRM
Last week I advocated for the death of digital rights management, but noted that film studios are nowhere near foregoing DRM. DRM for video is going to be with us for a while.

As a DRM specialist, Widevine Technologies thrives on studio fear of piracy. Earlier this week, the company announced support for the Adobe Flash video format, a move straight up the anti-piracy alley, with a consumer-friendly element to boot.

But Widevine held back on formally announcing other pending moves that have the potential to - first and foremost - increase its business, but could also insulate it a bit should video content owners decide to drop DRM.

WIDEVINE TECHNOLOGIESFirst off, by virtue of being able to encrypt and provide digital rights management for all major video encoding formats (MPEG-2, MPEG-4, Flash), Widevine claims it is the first and only DRM provider that allows consumers the freedom to choose their entertainment platform.

A studio going with a multi-format DRM solution (like Widevine's) gets a chance to sidestep some of the problems the music industry faced with DRM - consumer frustration with an inability to port their music from one player to another because of proprietary DRM formats and proprietary players. Eliminate or diminish that frustration - allow consumers to download video in any format they want - and a big part of the problem with DRM goes away.

So DRM for video might become less obstructive and therefore acceptable. But it could end up being ditched. Either way, Widevine's next moves will supplement its business in the former case or opens a migration path to a new business in the latter case.

Widevine intends to turn its DRM system into an advertising insertion and management platform.

Widevine decodes DRM-protected video each time the content is played. It's a relatively simple matter for Widevine to insert an advertisement into the stream/download on behalf of its video customers, and it has a utility to make sure that ad gets played that Widevine says defeats applications that viewers might install designed to strip out ads.

By monitoring playbacks, Widevine can naturally provide some ad viewership metrics.

But what if the movies are downloaded? Will viewers have to watch the same ads over and over?

Widevine CEO Brian Baker says no. Widevine can dynamically swap in new ads. Furthermore, it could potentially give content owners the ability to do the ad-swapping - client-based ad insertion.

But doesn't that become an enormous content- and ad-management task?

Baker says yes. "It's a big business, and we'll probably announce it as a separate product,"
Baker said.

That all struck me as fairly clever.

Brian Santo, IP Capsule Editor & CED Magazine Senior Editor

KT moves toward IPTV; picks Dasan for IPTV STBs
Korea Telecom (KT) will use IPTV set-top boxes from Dasan Networks for its Megapass TV service. Dasan's set-tops are based on silicon provided by Sigma Designs.

Megapass currently provides broadband at rates up to 50 mbps. In preparation to offer IPTV on Megapass, KT intends to upgrade its ADSL network to fiber-to-the-home (FTTH). KT expects to begin volume deployments of Megapass TV in July of this year. The new Megapass TV will include live television, pay-per view, high definition content, video-on-demand, and interactive services.

While there are a variety of IPTV set-top makers around the world, a common element in many of them is a process from Sigma Designs. Sigma's chips are also at the heart of set-tops used by Deutsche Telekom in Germany, Neuf Cegetel in France, AOL France, and KT competitor Hanaro.

Comtrend's CT-5621
Multi-port ADSL2+ Router

Pioneer Telephone using
Comtrend home router for IPTV

Oklahoma-based Pioneer Telephone Cooperative, the fourth largest telephone cooperative in the United States, will use Comtrend's CT-5621 Multi-port ADSL2+ Router as the key customer premises equipment (CPE) to support its IPTV and broadband services. Pioneer Telephone is a multi-service communications company with more than 140,000 total customers/members in 30 Oklahoma counties.

Motorola hits 1M mark with IP STBs
Motorola has shipped its one-millionth IP set-top. The VIP1510 is one in a series of STBs incorporating a hard drive and capable of processing MPEG-2 and MPEG-4/AVC in standard definition and HD. In February, Motorola acquired Kreatel Communications, a developer of IP-based digital set-tops that provided IPTV set-top software and hardware solutions to European telecoms and ISPs.


Galaxy Broadband offering DBS VoIP, care of Hughes
Galaxy Broadband Communications, a satellite-based Internet access provider is now using a satellite from Hughes to provide IP-based services - including VoIP, Citrix, and VPN - in Canada.

Satellite-based VoIP is subject to latency and other quality problems. The value of DBS IP services is that Galaxy will be able to reach remote areas not served or underserved by any other broadband provider. Galaxy is also positioning the service as back-up to terrestrial networks.

In a white paper the company published in March, it said "If you are contemplating purchasing a satellite Internet system just so you can eliminate your telephone company and save $35.00 a month, we suggest you reconsider. Voice over Satellite Internet should be considered as a viable option only if you do not have a reliable wired telephone line. Those in remote areas where cell phone, radiophones, or satellite phones are the only options to communicate with the outside world can benefit from this technology and should seriously evaluate the benefits, including cost savings."

New Global offers private-labeled VoIP
New Global Telecom (NGT), which has been providing wholesale hosted and trunk-based VoIP all along, announced what it's calling its Private Label VoIP Service, for potential customers looking for an outsourced VoIP solution that will allow them to provide VoIP services quickly. NGT said it is targeting VARs, ASPs, ISPs, systems integrators, retailers and other non-traditional telecom providers who don't want to assume operational responsibilities for VoIP service.

Judge bars Vonage from signing up new subscribers
CEO Michael Snyder stepped down and resigned from the company's board of directors, just a few days after a U.S. District judge ruled Vonage can not sign up any new customers while it appeals Vonageits loss in a patent infringement lawsuit filed by Verizon. It's a fairly devastating blow to Vonage, though not as bad as being forced to shut down entirely. Vonage intends to file an appeal against the injunction.

With Snyder gone, company chairman Jeffrey A. Citron has taken the reigns as interim CEO while the company looks for Snyder's replacement.

At the same time, Vonage announced preliminary results for the quarter ended March 31, 2007, including revenue of $195 million, a net gain of 166,000 subscribers, and average monthly churn of 2.4 percent. In Q4 2006, the company reported record revenue of $181 million yet still lost $65 million.

Citron said the company is taking a number of measures to reduce the company's costs and operating expenses. Vonage intends to reduce its marketing expense by approximately $110 million, and slim its G&A by $30 million through the remainder of 2007 through consolidation of operations and a workforce reduction that may trim up to 10 percent of the company's workforce.

Verso to acquire sentitO Networks
Continuing to build a VoIP system portfolio, Verso Technologies will acquire privately held sentitO Networks for approximately 7.7 million restricted shares of Verso common stock.

Founded in 2000, sentitO sells open and distributed VoIP gateway solutions for telecommunications service providers worldwide. The sentitO Open Network Xchange (ONX) is a SIP-based architecture enabling customers to offer voice services.

Arris' telephony products chosen by Mexican MSO
Arris Group's C4 CMTS and Touchstone E-MTAs have been selected by Mexican MSO Cablemas for its expansion of digital telephony service. Cablemas has previously deployed Arris technology to provide VoIP service to more than 30,000 homes in cities including Cuernavaca and Tijuana, and the MSO expects to launch the service this summer in additional cities where it has franchises.

Report: Business VoIP users can't quite cut cord
In a bit of good news for traditional telephone companies, the number of U.S. businesses using VoIP continues to grow, but even those adopting VoIP are not completely abandoning their traditional phones, In-Stat has found.

VoIP is currently used by 20 percent of U.S. businesses, but 44 percent of these businesses' voice lines remain TDM. But the tide has turned. In-Stat predicts that two-thirds of U.S. businesses will have some form of VoIP service by 2011.

"VoIP is particularly attractive to businesses with dispersed workforces, where long distance savings can be easily achieved," says David Lemelin, In-Stat analyst. "However, VoIP is not typically embraced as the sole source of voice communications for the vast majority of businesses that have adopted VoIP to date."

Arris's C4 CMTS

J:Com sticks with Arris for DOCSIS 3.0 gear
J:Com is deploying Arris' FlexPath pre-DOCSIS 3.0 wideband channel bonding solution based on its C4 CMTSs and Touchstone Wideband Modems. The pre-DOCSIS 3.0 version of Arris' wideband equipment will help J:Com deliver Internet service at downstream speeds of up to 160 Mbps and upstream speeds of 10 Mbps.

J:Com has been one of Arris' largest CMTS customers since 2004. The operator had 2.62 million customers as of December 31, 2006.

Moto snags rights to sell ECI's IP DSLAMs
In a maneuver to strengthen its position in the worldwide telco market, Motorola has arranged to be able to brand, market, and sell outside plant and central office IP DSLAMs from ECI Telecom. The IP DSLAMs portfolio will be added to Motorola's fiber-to-the-node (FTTN) and fiber-to-the-premises (FTTP) products.

Financial terms of the multi-year deal were not disclosed, though Motorola said it would have "an exclusivity period for the North American market."

Broadband gear revenue to hit $15.1B by 2011
And the good times for broadband equipment suppliers should only get better. Broadband equipment factory revenue is set to grow to $15.1 billion by 2011, up from $11.2 billion in 2006, according to iSuppli Corp.

XO, Nextlink unwire Seattle
XO Communications and Nextlink Wireless Inc. have rolled out broadband wireless technology in Seattle's metropolitan area. XO delivers services directly to businesses over wireless links at speeds ranging from 10 Mbps to 155 Mbps (OC- 3), the company said. Services include high-speed Internet, metro Ethernet and VoIP.

Current Issue

April 2007
Issue Contents

New Global Telecom
Headquarters: Golden, CO
CEO: Mike Donnell

Claim to Fame: NGT is a provider of wholesale hosted and trunk-based VoIP solutions in the United States.

Recent News of Note: The company recently introduced an outsourcing service that will allow customers to private-label its VoIP products.

April 14-19, 2007
Las Vegas, Nev.
More info: Click Here 

China Broadband
Triple Play/IPTV Forum 2007

April 18-19, 2007
Hong Kong
More info: Click Here 

China DSL Forum 2007
April 18-19, 2007
Hong Kong
More info: Click Here 

The Cable Show 2007
May 7-9, 2007
Mandalay Bay - Las Vegas
More info: Click Here 

May 22-24, 2007
More info: Click Here 

China VoIP
Conference & Expo 2007

May 23-24, 2007
Hong Kong
More info: Click Here 

SCTE Cable-Tec Expo 2007
June 19-22, 2007
Orlando, Fla.
More info: Click Here 

C-COR Global IP Summit
June 28-29, 2007
Cannes, France
More info: Click Here 

Wireless & Mobile
Expo & Conference

July 17-18, 2007
Toronto, Canada
More info: Click Here

CTAM Summit 2007
July 23-25, 2007
Washington Convention Center
Washington, D.C.
More info: Click Here

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