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Report: China's IPTV Market Saw 100 Percent Growth in 2008


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January 05, 2009

Report: China's IPTV Market Saw 100 Percent Growth in 2008

By Michael Dinan, TMCnet Editor

Though the number of IPTV (News - Alert) subscribers in China grew 100 percent from 2007 to 2008, the recession threatens to slow down a burgeoning market for making equipment that supports the technology, according to a Beijing-based research, consulting and IT outsourcing firm.

Officials at CCID Consulting say that telecommunications operators in the communist nation had a hard time turning a profit on IPTV last year, and that it isn’t clear how much money they’ll put into marketing the services as the global slowdown stretches into 2009.
Yet there is hope, CCID says.
About one year ago, the Chinese government released a general policy to encourage digital TV industrial development, but failed to follow up with specifics, according to the firm. 

As TMCnet reported, one prominent IT industry research firm today is calling for a more aggressive marketing approach to capitalize on an increasingly popular IP-based television market in the Asia-Pacific region.
Officials at Frost & Sullivan (News - Alert) say service providers must do more than simply market IPTV services as another part of their so-called “n-play” offerings.
According to Adeel Najam, a research analyst with the firm, telecom companies won’t attract cable and satellite TV subscribers unless they offer more content. Operators with broadband speeds of 10 megabits per second must offer IPTV to optimize their bandwidth capacity.
And yet, the research firm reported, “Due to slow progress of digital TV in China, the IPTV industry can develop with fairly wide window of opportunity. In the next three to five years, we predict that IPTV will face intense competition.”

Now, CCID says, the convergence of three maturing networks stands to create favorable development opportunities, the firm says, as well as “realize stable development for the three networks, and solve standardization and market access.”
“The related detail policies will be released and the policy environment is expected to greet further breakthroughs,” CCID says.
As TMCnet reported today, the Chinese government is paying more and more attention to its tech sector, as evidenced by its more strict policies governing copyright violators.
Just days ago, the leaders of a Chinese group that’s been accused of creating more than $2 billion worth of technologically advanced but counterfeit Microsoft Corp. software were sentenced to prison terms of up to 6.5 years.
According to The Associated Press, the penalties for the 11 defendants mark the harshest yet seen for breaking China’s piracy laws. Officially, news of the sentences was broken by Redmond, Washington-based Microsoft (News - Alert), as Chinese court officials are not required to disclose details to reporters. Rulings in the communist nation often are not announced.
By the end of last year, the number of of IPTV subscribers in China reached 700,000, CCID says, though operators offered the services for free or at a low cost because they don’t know enough details about the market there to leverage the product, according to the firm.
Part of what drove the technology’s popularity was that it was showcased during the summer Olympic games in Beijing.
“User recognition of IPTV services was improved,” the firm says. “In 2009, the continued increase in subscribers will attract more content and service providers to enter the IPTV field. Based on IPTV’s particular order program and replay functions, they develop typical music, movie, game and public services. The competition between IPTV and DTV will focus on differences in product content and functions.”

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Michael Dinan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Michael's articles, please visit his columnist page.

Edited by Michael Dinan

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