In the cable model of Figure 6.1 we now add a shaded arrow showing the flow of content, as in Figure 6.2. Content enters the network directly (contribution is shown as a vertical line). From the internal core fiber entry points (for
Figure 6.2 Cable TV's content (shaded arrow) and revenue (solid arrow) flows.
example, “head-ends” in the MSO cable terminology), the content is delivered entirely over the cable MSO's network to the consumer.
Conversely, the subscriber revenue is paid directly to the cable operators (the dashed arrow) - usually some form of monthly direct debit. Accounting data and usage data flow back up the system (solid arrow) varying with usage, and that is collected along with the subscription. This is an on-net model: the operator accounts and bills for use of network services.
The IPTV model can be offered by potentially any last mile operator as shown in Figure 6.3. The key thing about IPTV services is that they guarantee SLA end to end, and so offer just as high a standard of quality delivery as a cable TV network, enabling a Telco to offer the same service as a cable operator.
Our royalty premiums (or at least the SLA QoS measurement and accounting data for them) has to pass through the fiber Telco environment to the source. This is much the same as how a super head-end (SHE) would talk to regional head ends in the traditional MSO model, but now the last mile can also be addressed by copper and fiber last mile operators.
There is little to stop a mobile or wireless operator from offering their customers an IPTV service too, but SLA claims will get muddied by the fact that the last mile will have a variable QoS depending on the local radio link. Accordingly expectation management could become a significant overhead. However, with OTT services now being the norm, even mobile operators can consider in-house IPTV as a service offering to their customers, if the operators themselves have the aptitude to negotiate suitable rights deals.
Figure 6.3 IPTV model's content and revenue flows.