Tim Bourne – Page 4 – Digital-Lifestyles

Eutelsat IPO At 14:30 In ParisToday

Today will see the share IPO of Eutelsat, the third largest satellite operator.

Shares are due to start trading in Paris at 14:30 at €12, following its cancelled flotation last month. A total of €860m should be raised.

Some are wondering if, in the year that marks the 60th Anniversary of Arthur C Clarke’s famous Wireless World treatise on ‘Extra Terrestrial Relays’, a shadow may have fallen on Satellite’s hegemony of trans-global communications.

Only yesterday, the great and the good of the satellite business gave their views on the future of the industry at the Arthur C. Clarke event at the IEE in London.There was much talk of uncertainty in the industry, with many small Niche audience’s becoming the expected targets of the future.

Eutelsat is positioned behind Intelsat and SES, the giants of global satellite business. It has 23 satellites of its own, transmiting around 1,700 television channels. It has its main markets in the super-served regions of Europe and the Middle East.

Eutelsat

BT Cashes In To Goverment Money

BT have been enjoying government payouts to maintain their networks.

Interesting news for all those that thought it was many years since BT was an ailing monopoly to be propped up by a Labour government.

It was revealed in an answer to a parliamentary question (text below), that around £7 million has been paid to BT in England and Wales, and a contract for work in Scotland, that is not yet complete, should benefit the Telco goliath to the tune of a further £16.5 million. BT has also received undisclosed sums from the East Midlands Development Agency to extend broadband availability in the region.

Now this might come as a surprise to those who’ve got the impression that BT was doing this along with its investment in the so-called 21C network, as some sort of “Noblesse Oblige”.

Looking back over our archives for January of this year, it put a smile on our faces to see BT, when defending itself against smears of improper financial assistance related to the UK property rating system, responded to criticism leveled by those terrible bureaucrats in Brussels with…

“BT is surprised that the European Commission is to investigate the UK government over the property rates that BT has been paying. In BT’s view, any allegation of state aid would be groundless as BT has received no benefit from the UK government. BT is confident that the UK government will demonstrate the fairness of the UK ratings system.”

Expect smaller UK operators to cry foul – with some justification – as they see the dominant player’s position reinforced by government money, and BT’s competitive edge further strengthened in areas that include upgrading their network for TV delivery.

(Ed: Looking at this information, it feels wrong that BT are being given public money to maintain their network, one which they are directly gaining income from. This benefit isn’t passed back to the general public who are funding it, but instead to BT’s shareholders.

—-Fully text of the questions and answer.
Stephen Crabb (Preseli Pembrokeshire, Con)

To ask the Secretary of State for Trade and Industry what the total amount of financial subsidies and grants received by BT has been since 1997 for the purpose of extending broadband availability in the UK.

Alun Michael (Minister of State (State (Industry and the Regions)), Department of Trade and Industry)
Since 1997 BT has received the following financial sums to enable exchanges to extend broadband availability in the UK:East of England Development Agency paid BT approximately £500,000, to enable most of their remaining exchanges in BED A areas. This was awarded through the Broadband Aggregation programme.

Following a competitive tender South West Regional Development Agency awarded BT approximately £3900,000 to enable some exchanges in the Cornwall area.

Following a competitive tender, BT in Wales was awarded £3.6 million of European Structural Funding to upgrade over 40 BT telephone exchanges from UXD5, making ISDB2 services available to 99 per cent. of BT lines. The investment was also used to enable Digital Subscriber Lines, ahead of the commercial roll-out programme for the UK, in BT exchanges in market towns across Wales. It is estimated that the total project value was around £6 million.

Following a full EU Procurement Process to extend broadband availability in the North East region, BT was paid £1,830,345. This sum is subject to a downward adjustment, in accordance with a reverse contribution scheme, which operates to repay money to the Agency if broadband take up in the region exceeds a prescribed level.

£364k was awarded to Vale Royal Local Authority acting on behalf of the Cheshire Digital Development Agency who, following a competitive tender through the North West Regional Aggregation Body, awarded BT a contract to enable of a series of remote rural exchanges in Cheshire.

In Cumbria, Your Communications was awarded a large infrastructure project (Project Access) contract for approximately £17 million following a negotiated, state aid approved OJEU competitive tender. Your Communications sub contracted part of the contract with a value of around £1 million to BT for the early enablement of all the exchanges in Cumbria and specifically for the enablement of 14 exchanges in the remotest areas of the sub region.

In Scotland £16.5 million was awarded to BT following competitive tender. The roll-out has not yet been completed so not all the money has been paid as yet. The European Commission was notified under State Aid rules.East Midlands Development Agency has worked with BT on a number of sub- regional strategic partnerships, to extend broadband availability. As part of the contractual arrangements confidentiality agreements were signed by the sub- regional partnerships to protect information as commercial in confidence. Accordingly, this information is not be available for disclosure.
Hansard reference

Satellite Business Joins The Niche Club

The Legacy of Arthur C. Clarke, Review: IEE Lecture

Satellite Business Joins The Niche Club Yesterday evening saw a celebration of The Legacy of Arthur C Clarke at the IEE in London.

Rightly so. His fame not only stretched across the globe, it spanned fathering the communication satellite, to great fiction. Who can forget the seminal Sci-Fi classic 2001- A Space Odyssey?

During the addresses given by the assembled industry heavyweights, pontification was rife as they pronounced on the effect of satellite technology advances and where the industry stood in the communication world today.

To boil it down – satellites would be an important part of the communications mix, but it was unlikely to be as dominant as it was once thought.

Getting stuck right in was Olof Lumberg, formerly Chairman of Inmarsat, remarking on how the cabling of the planet was making some uses of Satellite technology passé.

Seeing quite how far Skype is disrupting businesses was interesting as key figures from the satellite industry noted that customer expectations brought about by Skype and similar VoIP technology had meant that the business model that ‘costs in’ the launching of huge satellites was becoming increasingly redundant.

Satellite Business Joins The Niche Club Professor Barry Evans of the University of Surrey considered the 1980’s and 90’s were probably the golden age for communication satellites and predicted their future as an infill technology. Working alongside terrestrial delivery systems, with the possibility of satellite providing TV connectivity to mobile devices outside the fibred home.

Marcus Bicknell, Commercial Director of SES Global the satellite giant spoke about the importance of niche markets and revealed a new low cost satellite mobile phone designed to help parents locate their children.

Some were more optimistic. Sir Martin Sweeting, who heads Surrey Space Technology, a world leader in small satellite development, saw a future with far less expensive launches. This could lead to the creation of ’clouds of small deployable satellites,’ configurable to provide focused communication at times of disasters.

Happily it wasn’t all business predictions. Arthur C Clarke’s brother Frederick spoke charmingly about his brothers’ early enthusiasm in looking at the skies.

The crowning glory of the night was a recorded message from Arthur C Clarke himself, from his home in Sri Lanka. Projected onto a large screen at the grand, historic setting of Savoy Place, home of the IEE, Clarke’s lucid speech belied his eighty-eighth birthday, only a few day away.

Reassuring to hear that his commitment to technology remains.

IEE – Institution of Electrical Engineers

3 Italia Buys TV Broadcaster: Now First Euro Hybrid Mobile TV Co

3 Italia Buys TV Broadcaster: Now First Euro Hybrid Mobile TV Co In a sure sign that TV to the mobile is the new European media battleground, 3G mobile operator 3 Italia have announced its plans to purchase the Italian national broadcaster, Canale 7. Reports have put the price of the acquisition at between €30-35m.

The addition of Canale 7, Italy’s fourth largest broadcaster, gives the company access to the country’s existing home TV business. Canale 7 currently broadcasts in analogue to around 40% of Italy, predominantly its north. More interestingly, it also has a terrestrial digital TV nationwide network operator’s license. This should provide coverage for over 70% of the country.

It is expected that 3 Italia will work to develop a Pay-TV and interactive services proposition for handhelds. We also understand their intention would be for Canale 7’s nationwide digital project to be integrated with 3 Italia’s UMTS mobile network to create a DVB-H network.

3 Italia Buys TV Broadcaster: Now First Euro Hybrid Mobile TV Co The company intends to offer a DVB-H mobile TV service from the second half of 2006. Indications are that there will be a minimum of 20 channels, although no line up has yet been decided. 3 Italia already carries Playboy adult entertainment and football via existing technology, and has worked with Mediaset and News Corp’s Sky Italia pay-TV operator.

Italy is already one of Europe’s leaders in mobile consumption and is considered to be a prime market for such services. Reports we’ve seen rather puzzlingly mention a “standard of video quality comparable to DVD” perhaps somewhat unlikely on the small screens that will be deployed for this sector – but we’re sure the picture will be absolutely bella.

3 Italia, which is owned by Hong Kong-based Hutchison Whampoa, has so far invested €9bn in its 3G network since obtaining a license from the Italian government in 2000. It currently has around 4.8 million Italian subscribers. Hutchison Whampoa also own 3G licenses in other countries including the UK.

3 Italia
Canale 7

NBC Take First Pop At TivoToGo Enhancement

NBC Take First ‘Pop’ At TivoToGo Enhancement As we predicted last week, the US TV networks are not taking the new TiVo enhancements to its TivoToGo lying down.

NBC are making the early running, with a spokesman telling the Hollywood’s Daily Variety trade paper, “TiVo appears to be acting unilaterally, disregarding established rights of content owners to participate in decisions regarding the distribution and exploitation of their content. This unilateral action creates the risk of legal conflict instead of contributing to the constructive exploitation of digital technology that can rapidly provide new and exciting experiences for the consumer.”

Legal types though, are quoting the landmark Sony v. Universal Studios case of 1984, citing it as a precedent where time shifting was expressly found to fall within fair use. Although this particular case has come under the microscope recently, during the Grockster case, where the the US Supreme Court ruled that companies could be liable if they deliberately encourage customers to infringe on copyrights.

NBC Take First ‘Pop’ At TivoToGo Enhancement It could be, that time will prove TiVo have announced prematurely this new augmentation, without fully taking account of the wide ranging business and legal implications. But in this fast moving sector, innovation is a necessity rather than an option.

TiVo

TiVo: PSP/ iPod Downloads Planned

TiVo Enhanced For PSPs And ipods TiVo have announced the release of new software, slated for the first quarter of 2006 that will let owners watch recorded television shows on their Sony PSPs and video iPods.

It doesn’t stop does it? Boy, is this technology disruptive.

What’s that sound? The sound of TV legal types rubbing their hands together as TiVo’s press release hit the ‘wires’.

TiVo’s software will enable subscribers to easily transfer recorded television programming, in MPEG-4 format. Other capabilities include auto-sync, letting TiVo users choose if they want new recordings of their favorite programs transferred to their portable devices via their PC. Recharging content onto their devices overnight, ready for the next days commute. It is expected to be priced as a one off of around $30 (~£17, ~€25).

TiVo Enhanced For PSPs And ipods This development is a further blow to TV network schedulers and their much-relied on conventional prime time programmes. This theory is torn apart when mobile viewers are able to watch programmes recorded the previous night, on the go.

The US networks are unlikely to take this lying down. Companies like ABC (part of media giant Disney) have been keen to generate additional revenue from download deals of their premium shows like Desperate Housewives – as offered by Apple through their online store, to their video iPod.

This TiVo development sees that particular rug being pulled from under them, and we suspect that they won’t be won over by TiVo’s promises to employ “watermark” technologies on programs transferred to a portable device.

TiVo’s share price has initially climbed, having faltered due to the perceived weakness in TiVo capabilities for both dual recording and HD use.

Some commentators are warning of the practical problems, expecting only the technically adept to be able to handle the transfers and pointing out that the enhancements will only be available to a subset of TiVo’s 3.8 million subscribers.

We think that while this could be the case for now, we don’t see this particular genie jumping back in the bottle.

TiVo

Nielsen To Include PVR Viewing In Ratings

Shock News -PVR Users Are Exposed To Adverts Nielsen, the top American agency that measures TV viewing audiences, is going to provide ratings that take account of time-shifted viewing through digital recording devices like TiVos even though viewers are able to, and in my experience, generally do, fast-forward through the paid for messages.

And as usual, with research funded by those that benefit, it could be worth taking several pinches of salt with this study. Some of the phraseology has strong hints of bamboozlement; the underlying message from a study conducted for the US TV networks, is that homes with PVRs and equivalents watch more commercials. Much the same came out from Sky after they introduced their Sky+ PVR.

Shock News -PVR Users Are Exposed To Adverts The US networks say that time-shifted ratings should be taken into account, and point out that PVR users watch more TV – which we don’t dispute. They watch around 5.7 hours and that’s more than 10% extra when compared with the technologically-disadvantaged standard household. Their logic follows that this extra 10% of viewing, gives them more opportunity to see commercials. With PVR penetration in the USA already around 8% of the TV universe and expected to rise steadily over the coming years, this adds up to a is significant amount for media buyers.

As one would expect, media buyers remain sceptical and many have said that they will ignore the new time delay viewers.

TV is now being consumed in a variety of ways. With Apple having sold more than one million download viewings of ABC programmes, expect further challenges for the agencies, as media companies seek to measure the viewing of commercials from mobile devices, Internet and other on-demand screenings.

Cisco and Scientific Atlanta Converge

Cisco and SA Converge Convergence took a step forward Friday past as Cisco announced the takeover of Scientific Atlanta (SA). The price? $6.9 billion cash.

SA shareholders don’t get a big premium (around 4%). The markets had already priced the shares to allow for a takeover talk, of which has been ongoing for some time – Sony being rumoured as one of the prospective suitors. Conversely, Cisco stockholders aren’t too enthused with the takeover, and see the cable business as riskier than the high margin routers that have been Cisco’s cash cows.

The acquisition looks a good fit though, Cisco are keen to push their IPTV proposition, SA’s strength in the US set-top-box market (they have around 40% market share) will allow them to capitalise on the access to the home that video brings. The companies’ combined news release majors on this, John Chambers, president and chief executive officer of Cisco Systems said “Video is emerging as the key strategic application in the service provider triple play bundle of consumer entertainment, communication and online services.”

The release also notes that the coming together of the two companies “creates a world class, end-to-end triple play solution for carrier networks and the digital home”

Formed in 1951, SA has long been a market leader in Cable TV, has a healthy balance sheet and already has one large IPTV customer in the shape of SBC Communications. The critical mass of SA as part of Cisco should help it win more.

Expect both Motorola (SA’s main US competitor) and Microsoft to consider how best to respond to this strategic move by the dominant Internet hardware backbone provider.

Cisco
Scientific Atlanta

Satellite Operators Consolidation To Continue

Satellite Operators Consolidation To Continue It’s not cheap to launch a satellite and, as commercial satellite operators have become prey to acquisition over the last 2 years, this has been followed by the operators consolidating. The economics of satellite distribution have fundamentally changed in the USA and Western Europe. Expect competition to be fierce in what was until recently a comfortable cartel carved out the International Telecoms Union (ITU) with constituent members many years ago.

Long term, there may be question marks over the future of satellite. While it’s currently the main method of transmitting digital pay-TV platforms to much of Europe, the threats increase. The combination of the continued increases in the efficiencies of encoding technology and additional service distribution reduce the need to rely on satellite.

Satellite does still have an important role to play as an intermediate solution, that is, providing connectivity and services ahead of the arrival of more sophisticated solutions. It will also continue as a ‘in fill’ for those places where the population is dispersed and delivery of data by other means would be uneconomic.

Increasingly telecommunications traffic is being carried by fibre – an example being sports games, that used to be delivered to the broadcasters by satellite, now routinely use fibre that is available at most major venues. This has led to many Telco’s divesting their interest in the satellite companies.

Satellite Operators Consolidation To Continue Telecommunications companies like France Telecom are increasingly selling off underused teleport facilities – they’re those places with loads of big satellite dishes pointing towards the heavens. These are being bought by satellite operators so they can offer an integrated end-to-end solution to their customers.

So expect the merged Intelsat/PanAmSat who bought PanAmSat for $3.2 billion at end of August to take satellite uplink business from Globecast (owned by France Telecom) and other European Telco’s who have traditionally up-linked their satellite services.

The metamorphosis will continue with an IPO by Eutelsat and a beefed up Inmarsat. Despite a good year for satellite companies, focus will shift to the growing markets of Asia and Africa with tighter control of costs and careful management of capacity in the mature markets.

Anyone say all change?

Too Easy(net) For Sky?

Too Easynet Yesterday, Sky’s takeover of Easynet was finalised and it looks to many that, despite paying a premium on the share price, they’ve have quite a bargain on their hands.

Easynet is not a ‘fly-by-night’ Internet start up but a profitable business having traded for over 10 years in it own right, it has equipment located at over 250 of BT’s exchanges and has earned its technological spurs with deliveries of 22Mb using its ADSL2+ network.

The broadband addition should future proof Sky against TV being broadcast to the home by ‘Wi-Fi’, and cable or fibre, expect future generations of receivers to start evolving into the home media hub with increased storage and the sophisticated Digital Right Management (DRM) that major film studios demand. Easynet will also offer an alternative to satellite delivery to customers who are prohibited from having a dish, or live in a built up urban area, where there can be no line-of-sight.

Too Easynet Although reports that broadband is the latest media battleground have highlighted the moves by the UK telcos, the ultimate prize is the fabled home digital information gateway. The opportunities that this acquisition enables go beyond a mere triple play option (Inernet, TV & Telephone), allowing Sky to, begin by become the overriding aggregator of TV content and, in time, become the preferred digital gatekeeper for many UK homes.

The prize? Being the ability to take a small fee for each of the numerous transactions that will take place.

Sky will be competing initially with the telco’s and ultimately Microsoft. Sky’s choice of MPEG4 H264 for future HD TV delivery pits it against Microsoft and their WMV HD. The two new encoding technologies offer similar advantages and share characteristics but, by and large, broadcasters remain wary of becoming locked into a Microsoft solution and prefer, historically the flexibility of more open standards.

Eyes are peeled to see if Sky Italia and other associated ‘News’ companies look to replicate this type of broadband acquisition.