BuddeBlog

In 2005 Telstra announced a mobile TV trial with 1,000 customers. A partnership had been formed with The Bridge Network (a full subsidiary of Broadcast Australia), which would develop the service for the company. The trial was based on the DVB-H standard. 

The Sydney-based 12-month trial with 375 users, known as ‘Movemedia’, was launched in 2005. During the trial, customers were able to watch programs from the ABC, Foxtel SBS, Nine Network, CNN, Sky Channel and other sources on Nokia GSM phones equipped to receive the signals which were being broadcast from the ABC’s Gore Hill transmitter. Coverage was expected to reach about 80% of Sydney. 

The trial was the first in the world of DVB-H using transmissions from a single high-powered transmitter and used one of two UHF channels presently reserved in capital cities for future services. No commercial services would be possible until ACMA made a decision on how to allocate these channels for commercial use. 

Telstra conducted its own experiments with mobile TV while participating in the trial, which allows simultaneous transmission of television broadcasts to mobile phones and PDAs. During the Commonwealth Games in 2006, users of its Third Generation (3G) mobile phone service were able to stream coverage of events from Telstra’s BigPond website. 

After the trial Telstra reported that 80% of the participants reported liking the ability to watch TV on the move, with viewing increasing during week days as workers accessed the service on the way to the office and at lunchtime. Users accessed the service for an average of 25 minutes per viewing session, with one or two sessions per day. The most popular content was general entertainment, news and documentaries, all of which met expectations, though many noted that they would like to be able to download and record programs to watch later. 

Later on that year Telstra suddenly announced its departure from the partnership, citing regulatory uncertainty. Telstra preferred to develop further services alone and established its own mobile TV business unit. Speculation had been mounting that it would bid for one of two new digital licences, able to carry up to 15 channels each and which could be used to deliver live television to mobile phone handsets.

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Over the past five to ten years we have seen great improvements in IT infrastructure developments, both in business and in government organisations.

Driven by the need to save costs, IT systems have been implemented that have automated many front- and back-office activities. Apart from the actual IT changes involved this has also changed the workforce behind these applications. Many people needed to be reskilled so as to be able to operate basically the same functions but with different tools. Often this consisted of changing from a largely manual process to a fully automated one.

The multi-billion dollar investments that are taking place have also resulted in super fast, efficient and cheap hardware.

An overview of some these new processes include:

• ordering, purchasing and transactions;
• dealer and sales support, customer service systems;
• automation in healthcare and education;
• e-government between agencies, services and applications to the public;
• web-based services (front-office and back-office);
• online publishing, media and advertising services.

While some services directly involve the public, most of them are still more on an internal level – between departments, between health care facilities, between government, their agencies and schools, hospitals, police offices, and so on.

The next revolution will take place between these organisations and their end-users. And broadband is the key infrastructure for the delivery of these services.

After five to ten years of practice with the above mentioned systems and applications, most organisations are now ready to take this next step. Further cost savings and the availability of low cost IT solutions are going to drive this.

As is becoming clear in countries where high-speed broadband infrastructure is widely available, businesses and government agencies are now pushing these IT applications out to the public. The first indications are that this can lead to direct cost savings of between 5% and 15%.

This is going to have an enormous impact on the budgets of health and education departments, and on the budgets of businesses with large customer service overheads. Many organisations desperately need these new IT/broadband facilities to be able to keep up with the demand for their services; this is most urgently the case in healthcare.

Already we see ‘impatient’ providers pushing for a faster rollout of broadband infrastructure; some are becoming actively involved in what are, for them, key markets; and others are looking at subsidising infrastructure costs in order to be able to push out their e-services.

The infrastructure costs involved in these services is often below 5% of the total costs; and it’s never more than 10%, so they can see the advantages of becoming involved in these broadband infrastructure developments.

Some telcos have problems understanding the massive shift that is taking place before their eyes, and they are unwilling, or incapable, of making the changes necessary to facilitate this process. However, this is the tsunami I have been talking about, and it is simply unstoppable.

Some telcos are now starting to face the consequences of having underinvested in their local access infrastructure for the last decade or more. No wonder others have become impatient and begun to look at alternative infrastructure (often, of course, in the most lucrative parts of the network first).

These include large cities such as Amsterdam, Brisbane, New York, San Diego and Stockholm (the last one already since 1990). Online media companies wishing to get their services out are building wireless broadband networks, and companies such as News Limited are providing free broadband access, provided the customer subscribes to their services also. Regional towns – really feeling neglected in all this – often have no choice other than to directly manage the process themselves.

Over the next five years we will see an explosion in high-speed broadband infrastructure, from both the incumbent providers and elsewhere. This will often be a chaotic process, as it means an enormous change to the monopolistic structures that are currently in place -which are often not able to cope with the massive increase in demand for bandwidth.

Most countries are ill-prepared, lack the appropriate government policies to address these national infrastructure developments, and are still not completely capable of grappling with these changes.

Paul Budde

For more info see:-
Global Broadband Infrastructure

Global Broadband Analyses & Forecasts

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1. THE PASSING OF KERRY PACKER

The death of Kerry Packer in December 2005 is one of many events that, combined, leads me to throw them all on the pile of the way things used to be.

For me, the death of Kerry Packer marks the end of an era that was full of drama.

I find myself looking back on affairs such as Telstra’s kicking and screaming during the last half year, Foxtel’s fight for survival and Seven’s court case. Other examples could be found if we were to look closely at some of the SingTel/Optus and TCNZ/AAPT developments.

2. MEDIA INITIATED GOVERNMENT POLICIES

These were all significant events within the environment of the time.

They took place in a world that was driven by government policies, and if you were skilful enough you could carve out a nice market for yourself and exploit the regulatory environment to the maximum by keeping competitors out. You could create monopolies, duopolies or cosy alignments with your peers around demarcation lines, in order to live and let live.

If things got hot you simply went off to Canberra for some pork-barrelling and you were set for another five, 10 or 15 years. I think Kerry Packer heads this list, as he was able to get a 15-year pay TV moratorium from the government to protect his wealth.

3. FROM BULLYING TO COOPERATION

However, slowly but surely this era is coming to an end. Telstra has been given some stern messages from the government, and with Kerry gone, fear and intimidation will now also be throttled down somewhat, which may allow for more rational media policies. I can’t see James being like his father, and I don’t think current times will allow for a new generation of business bullies.

But far more importantly, the battles are moving from government lobbying to competition based on new technologies. Competition for Packer’s Channel Nine now comes from broadband Internet, and Telstra is under threat from the same direction, with Internet-based companies setting the scene and wireless bypassing those parts of the network they abstract monopolistic rents from.

Seven’s court battle only further highlights the enormous powers that were at play in the old world of domination and bullying. Whatever the outcome, the picture this case presents of the traditional players in this market is very ugly indeed.

It is also a world where very intelligent, highly educated and senior business executives, during all of those old-era court cases and Senate hearings, suffer from persistent memory loss. Do these industry leaders realise what an example they are setting for their own employees and for the next generation in general? I am sure their behaviour will backfire on them, as most of the younger generation is appalled by this kind of behaviour. It also sends a clear message to the customers of the companies these executives represent – that they can’t be trusted.

4. MEDIA NEED TO PULL UP THEIR SOCKS

Unfortunately many are blamed for the behaviour of the few, since all business will be lumped together in a universal condemnation of free trade agreements and globalisation. I hope it is not too late for the young Packers and Murdochs to change their behaviour; otherwise this third generation will bring about the final demise of the empires built up by their fathers and grandfathers.

They no longer have the bullying powers of those old-timers, and the empires they rule are being attacked by technological developments such as the Internet, an area in which government protection is unavailable. Anyway, national border (protection) no longer applies in the global world of the Internet. It doesn’t matter what the service is – TV, entertainment, information, communications – these are all rapidly becoming global products, and the government can do little to continue to protect its media mates.

5. WATCH OUT FOR THE INTERNET MEDIA COMPANIES

As we have said before, the traditional companies have a huge task ahead in trying to find a new place in this rapidly changing business environment. Competition no longer exists between the media or telecoms companies. It comes from a totally different direction – from the many new players, such as Google, Yahoo!, eBay, Skype, Amazon, Microsoft and so on.

Just look at the different approach these two groups take to customer service. The old world has been paying expensive lip service via TV campaigns, to let their customers know how much they care. The new world simply delivers high quality customer service over the Internet.

Guess where the customers are going?

Incumbent telcos are losing customers in huge numbers and so are the media companies. And newspaper readership and TV audiences are nosediving. This is also reflected in the status of the share prices of these companies.

So it is two minutes to midnight for the old media and telecoms industries to change their tack and start some serious business reconstruction, so that they will be able to participate in the new era.

Now is the time to stop the rearguard battles aimed at preserving an age that is doomed to disappear.

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Nowadays people who are ‘upwardly mobile’ are not satisfied with houses that have poor broadband. In Dubai some 20,000 people are already on fibre in new housing developments. In all, well over three thousand fibre rollouts are currently taking place in new housing developments around the world.

There have been significant delays in fibering new housing estates in Australia. Developers have not been accustomed to being involved in telecoms infrastructure and they naturally looked to the carriers to do this work for them in the new developments.

However, neither Telstra or Optus have shown much interest. They want to be paid for it and they want a monopoly use of these networks. The other major stumbling block has been Foxtel’s unwillingness to come to the party. This monopolistic behaviour has been unacceptable to the housing developers and, after close to two years of time-wasting, the developers themselves are now investing in fibre rollouts. They own the facilities but in general will use independent operators to run the service.

More advanced developers are going one step further and are making the fibering central to their development, to create connected and intelligent communities – using it as a marketing tool to attract home buyers and businesses to their estates. They develop an estate around this concept and sell it as a major lifestyle improvement. Data centres for businesses, video studios for entertainment and professional services, as well as e-health and e-education facilities, all form part of such a concept. Homes are also designed with teleworking and home networking in mind.

As a result of Telstra’s unwillingness to cooperate developers are being forced to facilitate the deployment of two cables, for their own fibre and for Telstra’s copper cable network – so much for the clever country.

State governments have also come across the same problems, and in Victoria and Tasmania they have become actively involved in driving these projects.

Local councils, too, are seeing the benefits of FttH for the development of their communities. On a smaller scale, they recognise the social and economic benefits of FttH at a local level. They also see this as a new way to attract people and new businesses to their towns. Several councils are already actively supporting FttH in their new housing estates and it is rapidly becoming a fixed element in development applications.

See also:
Australia – FttH Market in 2006 – Analyses
Australia – FttH Models, Overview, Costs, Forecasts
Australia – FttH Projects
Australia – FttN plans from Telstra and competitors

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The article “The tsunami of structural change.” generated a high-level discussion by several financial analysts in three different countries, the main points of which I have summarised below …….

Why do it?
The key element in the article was that the structural separation of telcos is beginning to make sense to the financial market also.

Some of the analysts identified some problems up front, as did I. While it makes sense to go down the structural separation path, it is not going to happen overnight, mainly because it is such a radical evolution.

• Shareholder perspective: Shareholders are not pushing the idea of structural separation – they remain fearful that it could lead to lower profitability.
• Incumbent management perspective: Top management would lose their integrated – various parts of the incumbent would have to be managed truly independent and, in time perhaps be split.
• From a politician’s perspective, however, it would be relatively easy to proceed when confronted with a simple chart that demonstrates the link between broadband penetration/investment and competition. Furthermore it would provide a long term solution to the recurring telco debates.
• From a regulator’s perspective: Separation would lead to easier, more stable regulatory configurations. Possibly however the regulator would lose power as they would have to largely give up regulating customers interaction and just focus on maintaining an open network (which would be great).

Unleashing untapped values
One of the analysts argued ‘Why would you not push the thinking to its next level?’

From a financial perspective, utilities are often assessed on book value of equity (or, in more sophisticated instances, replacement book value), plus possibly some premium, depending on the returns allowed and growth perspectives.

Symmetrically, utility regulators favour total separation of network and end services, and essentially compute network prices to achieve a specified rate of return on book value.

Obviously, looking at things this way may reveal that many telcos are still overvalued as against their (replacement) book value. Could this be the reason nobody is keen to take the argument to its logical conclusion?

Structural separation doesn’t necessarily mean lower profitability for the telcos – actually the impact cannot be confidently accessed today. Neither does lower profitability necessarily lower market valuations anyway. If the financial marketplace more confidence than today in the sustainability of the income stream and understand better the various regulated and non-regulated components, they may reward the telcos with higher P/E and P/B ratios. With a clear and separate focuses on core business such as infrastructure and retail digital media, these changes could thus produce the opposite effect.

As has been discussed many times over the last decade, telco and media businesses require different business skills and different business cultures.

I don’t know any telco that has ever successfully become a media company. Thus, the media assets in for example Telstra Australia get marginalised by a company that has spent the last 100 years porting voice calls. These assets in the hands of some smart media people will create a much higher value. That value will never be created or accurately reflected within a telco company.
BT first cab of the rank
So far BT provides us with the only precedent we can rely on, and its regulated asset value differs considerably from its depreciated book value. Its regulated asset base is a touch over £11bn, whereas the value of these assets under IFRS is closer to £8bn, representing a discrepancy of almost 50%.

Unfortunately, since no one else has disclosed their regulated asset bases (nor provided the value of last-mile assets under IFRS within their fixed asset register) it is hard to know whether this is the case throughout the rest of Europe.

Ireland an even more interesting case
As I mentioned in my initial analysis, Ireland is currently the country to watch.

One of the questions being asked by the national carrier Eircom is just where do you separate the network? Once the network is split off there is more transparency, and arguably transfer pricing is removed. Some contend that in a more openly competitive model the sum of the parts doesn’t work, as the retail operations suffer margin implosion.

In those circumstances this same argument would play out in Australia with Telstra.

Thus, if the CAN was put into a regulated infrastructure trust (that is, the bottleneck component of the network) and the remainder was separated (that is, at the exchange), a much more powerful business would result – and one that would not (arguably?) constitute a natural monopoly.

Watch out for New Zealand
Equally interesting is that in Ireland the process of structural separation is not a regulatory activity because private equity will make it happen. This could also apply to the situation in New Zealand. Because there is a good chance that private money will acquire and separate the assets it is unlikely that either the New Zealand Government or Telecom management will bite that bullet.

Babcock and Brown Capital is a shareholder in Telecom NZ, so once Ireland, the ‘test case’, has been completed it will only be a matter of time before they look at the New Zealand situation.

I also mentioned the interest of Macquarie Bank in structural separation. They looked at Australia and Hong Kong and I am sure there will be other countries on their list as well.

Australia has been put on notice
Australia is one of the few other countries where the government has made moves in this direction, but, government policies there are often far too weak – and the regulator does not have power to act upon structural issues.

In Australia T3 was a lost opportunity, basically a missed shot in front of an open goal. However structural separation will eventually happen in Australia also, but it will most likely take longer in comparison with our trading partners, due to the incumbent’s usual delaying tactics.

I estimate it will take at least five years, but, you never know, Sol Trujillo might already be in discussion with some of the experts in the financial market, establishing what his options are.

Other financial consideration
To make it even more complex, the regulated utility is often just one component of a myriad other businesses.

Looking at it in another light, one of the analysts argued that 6.5x EV/EBITDA is not overvaluing a company that has a national presence and an instantly recognisable brand etc.

Some of the financial calculations indicate that telco assets more closely resemble utilities, and should therefore attract higher multiples than the consolidated group currently applies. Telco valuations remain heavily penalised by regulatory uncertainty – there is nothing worse than being a utility without being able to offer the financial stability of a utility.

Others, like myself, have tried to convince some of the parties involved that the network should become a regulated utility with a regulated return, sufficient to incentivise ongoing capex. If that were to happen the regulator, the voting public (asset remains in regulated structure and even with some government stake) and every political party would be HAPPY.

A massive win win win win!!

Create new digital media companies
The rest of the bits can be sold off. For many years I have been advocating in Australia the privatisation of Sensis, Foxtel and BigPond; now owned or dominated by Teletra. Combine them and create a formidable digital media company.

Another of the analysts suggested that shareholders could be allowed to choose the parts they want to own, or whether they want exposure to just one part (network, mobile, media assets, etc). That would have made shareholders happy, because the sum of the parts is always greater than the whole.

How to proceed?

The most important factor in a strategy like this is to start with a robust and simple long-term regulatory framework in the telecom arena, particularly in comparison with those that exist in other utility areas such as gas, water and electricity.

Paul Budde

PS
The analysts are keen to continue this debate, so your comments are welcome.

See also:
Global – Analysis – Industry – Structural Separation
Global – Industry – Regulatory – Privatisation, Structural Separation
Australia – Operational Separation of Telstra

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Australia continues to lag behind other countries in this respect, as there is more vigorous mobile competition in countries in Europe and Asia. It is expected that these countries will develop the more commercially viable applications, and these will be exported to Australia. This is a real pity, as Australian companies are as good as any of the developers overseas, but in their home market, Australian bred opportunities are limited.

However, on the international scene there are further complications. The key markets here are Korea and Japan, but they both use different technologies (Korea uses CDMA 1X and Japan i-mode). Both these technologies are incompatible with MMS. While the end-user experience might be roughly the same, the development of the application for each of these platforms is different. For example the MMS platform cannot be transferred to 1X or i-mode without significant alterations. This makes it difficult for local developers to market their services internationally.

Some other countries are looking at yet other platforms such as GPRS and EDGE. A really promising new technology is WiMAX, a true wireless broadband technology, but again totally different from any of the other platforms, For more information, see separate report: Australia – Wireless Personal Area Network (WPAN).

The USA is even further behind with very little interconnection between mobile networks and even a wider variety of competing standards.

For content providers to become involved in international applications, the way forward would be to develop applications that can be modified for the various platforms, rather than selecting one specific technology (MMS, 1X, i-mode, etc). However, we do question the economic viability of content providers in this respect. Content providers who are serious about pursuing this market should perhaps skip all these intermediate platforms (all grouped together under the banner: 2.5G) and start looking at 3G.

However, it is important to remember, that there won’t be any commercial returns within the foreseeable future.

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The difference that speeds makes
Just before Christmas our residential services ISP, TPG, upgraded our residential broadband service from 1.5Mb/s to 8Mb/s.

I was very pleasantly surprised to discover that Bucketty was included in the recent Telstra network upgrade. The 8Mb/s service is provided on a best-effort basis, but so far it has been working at great speeds.

The new service has played an important part in events in the Budde family home over the last few weeks. As you may recall from my reports in recent years our attempts at many of the new services have been rather unsuccessful. VoIP, web cameras, media centres – we have tried them all, but the result has been mediocre at best, and none of those services was taken up by us on a permanent basis.

Budde family technology review
But it is amazing how a new grandchild can focus one’s attention. My son and his family live in Wagga Wagga, so it was a no-brainer that a web camera would now be essential.

We started by reviewing our entire home technology system. One of the problems was that we were using the office VPN for both business and residential broadband use, and the Citrix settings are a real killer for residential broadband use. So six months ago this was attended to, and a new PC, complete with web camera, arrived. At that point the residential broadband service was upgraded from 512Kb/s to 1.5Mb/s.

Saving money with VoIP
With this in place it was then possible to revisit VoIP. The engine VoIP service was revived and after a few hiccups we now have a great VoIP service. It has had a lot of use during the Christmas break. We have made calls all around the world without one single glitch, saving a significant amount of money.

The Sebastian link
The web camera can be used through both MSN Messenger and Skype, and so far those in the know have voted for Skype. The picture is still too jerky for my wife’s liking, but I just marvel at the technology. We (as in ‘the boys’) are still not happy with the sound, and new microphones on both sides are next on the agenda. Sebastian (now seven months old) is also getting the hang of it and it will be interesting to see how long it takes before he begins to initiate web camera contact.

Movie downloads
With 8Mb/s it is now more feasible to consider movie downloads. Although some of the content on sites such as BitTorrent and eMule may be illegal I am amazed at the content that is available – from the recently released Casino Royal and Volver to Dutch movies from the past – movies that I have heard about but have never actually seen.

Downloading these might take many hours, but the quality is astoundingly good. And it is unlikely that we will ever exceed our download limit of 18Gbs.

Recently we wanted to watch a foreign language movie that had no subtitles. We searched for the subtitles, found them within minutes, and they merged perfectly with the movie.

Home movies
At the same time we are also digitising all our home movies and videos. These will be stored on two large external hard drives, which, of course, will be wired into the media centre set-up. In many cases we will be seeing these movies for the first time since they were made.

We are also considering storing our CD collection on the media centre.

Internet Radio
This is currently our most frequently used service. I already have the following 24/7 channels in my favourites:

• Beatles channel
• Choral music channel
• International music channel.

With the 8Mb/s service the sound quality is consistently excellent.

Photo library
Travelling and history are my two major hobbies, and photos form an important part of this. We can now look at photographs on our plasma screen – a plus on those occasions when you don’t want the bother of cranking up your PC to find the images in a photo album.

Still a long way to go…
It needs to be said that a high level of expertise is necessary to negotiate all this technology and I now must confess that my son is currently staying with us in Bucketty for a few weeks. I couldn’t have done all this without his help.

I am currently in training and can now, with his supervision, use our TV, PC, VoIP, wireless ADSL modem, web camera connection and the photo and video applications. With everything now properly installed I find it surprisingly easy to operate.

My wife, Louise, has yet to be convinced.

The number of laminated instruction sheets under the tablecloth on our coffee table is growing daily, but I can now move, unassisted, between the PC applications and Channel 7. Channel 7 is not available on Foxtel (grumble) so I need to switch to the digital set-top box to launch All Saints, one of my wife’s favourite shows.

But I admit that there have been times when she was forced to go into the kitchen or bedroom to watch All Saints on a small screen TV, while I frantically tried to drive the six remote controls to get everything working in harmony at the same place on the entertainment centre.

So the Hollywood Studios need not panic just yet. For most people using these marvellous new services is still far too complicated. BUT THE WRITING IS ON THE WALL. Once it gets easier this is most certainly the way entertainment will be enjoyed in the future.

Watch out for the new iMac developments in 2007. And the new Foxtel IQ box will, I imagine, also have a broadband connection.

However, I still estimate that it will be at least twelve months before commercially viable and reliable media centre equipment becomes available. Then the process of migrating from the current home entertainment environment to the new one will begin, and this could take five to ten years to complete.

But it is great to have a taste of what the future holds in store – and so far I like what I see.

Paul Budde

See also: Australia Digital Media

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Introduction

The longest established and most successful broadband powerline communications technology is intended solely for creating data links and networks within a single home or office. This is the HomePlug system. Other technologies in this field were rendered largely obsolete by the 2001 development of HomePlug.

Every socket a telco outlet

The main application of indoor PLC is in the setting up of local networks in competition with other solutions – such as Ethernet and WiFi.

PLC can offer advantages such as symmetric bitrates, speed and ease of implementation and in-premise mobility. However its best feature is the fact that it can provide both power and data transmission via a single cable.

‘The electrical grid is the only infrastructure capable of providing what we could call a ‘quadruple play’ offer, bundling power, telephone, Internet access and television’.

Orthogonal Frequency Division Multiplexing (OFDM)

Like the most successful ‘access’ BPL technologies, HomePlug uses OFDM, also known as ‘multicarrier’. Here we describe the HomePlug 1.0 standard, based on industry sources, since the standard itself is not publicly available.

Frequencies 4.3 to 20.9MHz may be used and are split into 84 evenly spaced carrier frequencies, each of which is modulated to carry a subset of the data. Multiple devices take it in turns to transmit – using Carrier Sense Multiple Access with Collision Avoidance (CSMA/CA). Modulation is typically by the robust, but low-rate Differential Binary Phase Shift Keying (DBPSK) and Differential Quaternary Phase Shift Keying (DQPSK), but important protocol-level parts of each packet use simpler methods and the same data on all carriers to maximise robustness. HomePlug uses many elaborate and sophisticated techniques at the Physical modulation (PHY) and Media Access Control (MAC) layers to create a reliable, adaptable multi-device networking system using radio frequencies over home power wiring.

HomePlug provides 14Mb/s theoretically, but usable bandwidth is lower than this, due to protocol overhead, noise, attenuation and the fact that this is a simplex system ˆ’ data can travel in only one direction at a time.

56 bit DES

Low-cost devices such as Ethernet and USB adaptors can be used to link PCs and other equipment simply by plugging these devices into power sockets. Data is encrypted with 56bit Data Encryption Standard (DES) and each device in the network must be initialised with a common key. While 56bit DES is unsuitable for commercially sensitive data protection, it offers a generally useful degree of privacy and security in situations where the signals in one home can be received in another.

Interoperability

HomePlug devices from 14 manufacturers, including Linksys (Cisco), Siemens and Samsung are interoperable. The system adapts to the potentially rapidly changing conditions by choosing which carriers to use. A variety of forward error correction and retry algorithms ensure data transfer within the limits imposed by the physical conditions. Most HomePlug devices use a specifically designed chipset from Intellon [http://www.intellon.com] but Cogency [http://www.cogency.com] has developed chips as well, including a single-chip HomePlug to Ethernet bridge.

Reach – with and beyond each home

HomePlug is intended to work within a home, but if two homes are located nearby on the same LV phase, there’s a good chance a network can be run between them. The ideal of operation within the home is not as easy at it seems – and data rates would vary enormously according to the conditions. For instance, two power sockets may be on separate circuit breakers or fuses, so their electrical connection may be quite distant, and via inductive circuit-breakers which tend to reject the HomePlug signals.

HomePlug, as originally conceived, is completely incompatible with any ‘access’ BPL system which uses the same frequencies. At best, the HomePlug system might avoid whatever subset of frequencies was used by an access system ˆ’ typically the lower frequencies. One of the major challenges of any access BPL system is compatibility with existing systems such as HomePlug which are expected to operate inside each home.

HomePlug Powerline Alliance

The HomePlug Powerline Alliance [www.homeplug.org] is a non-profit organisation formed by a group of US companies to establish an industry standard for high-speed home networking via powerlines. Interested companies are eligible for membership after signing an adopter/participant agreement and paying a small fee.

HomePlug AV

The HomePlug Powerline Alliance selected the underlying technology for its forthcoming HomePlug AV specification. The specifications allow consumers to send video content over their home electrical networks by simply plugging a HomePlug-equipped STB or DVR into the wall.

HomePlug AV is designed to improve upon the existing HomePlug standard with faster bandwidth, greater quality of service and simpler operation, it can be built into peripherals that connect digital televisions and wall sockets or directly into the television, allowing data to travel over the power cord.

HomePlug AV co-exists with HomePlug 1.0 on the same power line. The HomePlug AV specification also supports specific product implementations that allow HomePlug 1.0 certified products to interoperate with HomePlug AV products. In December 2005, the HomePlug board made the finalised specification available to members. The first HomePlug AV products were announced in March 2006.

HomePlug BPL

In July 2004, HomePlug embarked on a project to enable in-house networking to co-exist and interwork with access BPL signals from the street. No technical details of this work were available but in March 2006, the project had reached its second stage, having finalised the ‘Market Requirements Document’ in June 2005. Any such co-existence scheme for the long-term would need to work with the OPERA standards and any IEEE standard which emerges in the future.

HomePlug AV has been chosen as the baseline technology for HomePlug BPL, which means that the final system will not be compatible with OPERA.

HomePlug Command and Control (HPCC)

In 2005 the HomePlug Powerline Alliance started to develop a specification for an advanced command and control technology, known as HomePlug Command & Control (HPCC), a low-speed, very low-cost specification intended to complement its higher-speed powerline communications technology.

The technology would enable advanced, whole-house control of lighting, appliances, climate control, security and other devices and would ‘address the growing need for low-cost yet high-performance and reliable technology for home control’.

The Swiss-based Metro organisation launched its smart home initiative back in 2004 and in 2006 wireless and PLC technologies are combined with Radio Frequency Identification (RFID) and other innovations. In cooperation with white goods manufacturers they are expecting to launch products in the market within the next two years.

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(Source: OzTAM)

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Broadband TV

IPTV delivers broadband to the TV and puts the viewer in control. With the arrival of the Internet, content became more prominent and video-based applications were revived in order to deliver them over the Internet. The file-sharing features of the Internet created the success of Napster. Similar peer-to-peer file sharing initiatives show that multi-media file sharing remains a key application. More specifically, multi-media file sharing can be seen as a subset of webcasting, of which streaming data/audio/video and Video-on-Demand (VoD) are other examples. New Digital Subscriber Line (DSL) based-broadband networks are now rapidly moving into triple play business models, delivering voice, data and video services; IPTV is one of the new emerging disruptive technologies.

For more information, see separate report: Australia – Digital Media – IPTV.

Consumer Market Overview & Statistics

The most significant change broadband is bringing to the market is that it is opening up consumer markets. For decades only corporate users have been able to afford data services. The Internet quickly used this new data development to create an enormous number of consumer applications. Broadband improved the quality, by allowing for video-based applications, and, just as importantly, it has made access to digital media affordable to the mass market. Over the next decade this market will grow to over $20 billion. This report provides an insight into this market and analyses the various segments and specifics. Statistical data is provided to quantify the various elements of the market.

For more information, see separate report: Australia – Digital Media – Consumer Market Overview & Statistics.

Electronic Program Guides

With increased choice customers need to be able to manage the entertainment they want to sample and use for their personal or household use. The Electronic Program Guide (EPG) is the first product to offer customers an entertainment management option. Starting with simple program listings on the Internet, EPGs became integrated in Digital Video Recorders (DVRs), which allowed the viewer to pre-select TV programs and store them in their DVR for use at their leisure. EPGs are now rapidly becoming part of the broader Home Media Centres, which are developed by companies such as Microsoft and Intel. In Australia IceTV is the local market leader.

For more information, see separate report: Australia – Digital Media – Electronic Program Guides.

Games, Gambling, Dating, Adult services

With the convergence of telecoms, media and IT we see the arrival of Digital Media. This report focuses on some of the key applications. The narrowband services have been around for several years and the new video applications are emerging as the Internet media companies seek to exploit the added speed and capacity of broadband infrastructure. As speed and capacity increase, a whole new range of applications will be entering the market over the next decade. This report includes the digital media developments in games, gambling, online dating and adult entertainment.

For more information, see separate report: Australia – Digital Media – Games, Gambling, Dating, Adult services.

Portals, Directories, Searching, Blogging, Publishing

With the convergence of telecoms, media and IT we see the arrival of Digital Media. This report focuses on some of the earliest Internet applications and their consequent developments and the early emerging business models. These applications have created some of the largest media companies in the world. As speed and capacity increase, a whole new range of applications will be entering the market over the next decade. This report covers Internet portals, online directories and search engines, blogging, vlogging and web publishing.

For more information, see separate report: Australia – Digital Media – Portals, Directories, Searching, Web Publishing.

Video entertainment, Music and MP3

With the convergence of telecoms, media and IT we see the arrival of Digital Media. This report focuses on two of the key applications; video entertainment and music. As broadband speed and capacity increase, a whole new range of applications will be entering the market over the next decade. The killer application on these networks will be video based communication, mainly produced by the users themselves. Commercial video entertainment will only account for a quarter of these services. MP3 is a good indication where the video market of wireless broadband (mobility) will move into.

For more information, see separate report: Australia – Digital Media – Video Comms, P2P, Instant messaging, Blogging, Social Networks

Mobile Content – Services overview and stats

Business models for content providers remain shaky with operators still charging a hefty 30-50% of revenues. A few initiatives saw some marginally changes occurring in 2005 which continued in 2006. The music industry negotiated better deals and on Telstra’s i-mode service, content providers do receive better margins. However 95% of usage takes place on GSM services. Ringtones and wallpaper still dominate the market followed by music and games. A breakthrough in mobile content is not expected until later this decade.

For more information, see separate report: Australia – Mobile Content – Services overview and stats.

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