Let's talk about High Definition TV and getting this wonderful but very fat signal around the home. Huw, how are your customers looking to distribute signals around the home?
Huw Price-Stephens, Amino
For our customers HDTV around the home does not represent a significant challenge, much more than the problems of standard definition. It needs additional bandwidth and to tap into those distribution technologies around the home but they are all capable of carrying the HD signal once it is in the home. The more general question is how the market is reacting to the introduction of HD services, I can tell you that in the US, we see a large, even a predominance of service providers moving to HD. HD is part of everyone's portfolio in Western Europe. Transition is moving rapidly although in Central and Eastern Europe and South America the transition is somewhat slower. HD is coming front and centre and is a major force. Even if people are not yet actually delivering signals, they are investing in HD STBs because they want to future-proof their capital investment against future demand.
Chris Forrester
Is HD part of the RFPs (Requests for Proposals) that you are responding to?
Huw Price-Stephens, Amino
Definitely. In a typical home today there may be TVs that can and TVs that cannot receive HD. In North America some of our service providers are deploying an average of 2.7 boxes per home and often this is one box good for HD and a couple for standard definition. So even where an HD service exists, it may be mixed with standard definition equipment as well. The market is in transition towards this position.
Chris Forrester
Paul, Pace is something of a pioneer in HDTV. What is the market looking for from you?
Paul Entwistle, Pace
Look at DirectTV in the USA, one of our customers. They are already buying a very high-end PVR fromPace. It has five tuners with an H.264 receiver in order to receive around 100 HDTV channels. So they have a huge investment in HD. We see at least 50% of our revenues coming from HDTV and we are seeing customers who are reluctant to invest in Mpeg2 boxes that will quickly become obsolete, which means they are buying H.264 equipment that is backward-compatible with standard definition, ready for High Def.
Chris Forrester
But surely a five-tuner device means there are slave boxes around the house?
Paul Entwistle, Pace
Yes, this is true and this means there is already interest from many of our customers as to what sort of home networking they should be looking at and what they should encourage or install. In the US market, developments like MoCA (Multimedia Over Co-axe Alliance) and similar technologies are increasingly important and they have the capacity to do HD distribution within the home. Elsewhere in the world we are also seeing a lot of interest in using power-line technology, and you must remember that compression decoders have improved significantly over this past year or two and thus what might have been a 20 Mb signal is now delivering the same service at 10 or 12 Mb. The burden on the home network is not so great.
Chris Forrester
Will wireless play a part?
Paul Entwistle, Pace
Wireless definitely has a role and new technologies like 802.11.n provide for very good capacity within wireless. The only challenge with wireless is the guarantee of how robust the signal is. Most customers that I talk to would like to see the consumer take a mixture of home networking technologies to ensure the best experience.
Huw Price-Stephens, Amino
We actually have pay-TV service providers using wireless technology in North America and in Europe today. We also have people using power-line technology.
Chris Forrester
Most American homes, however, are not built as solidly as Northern European homes. How would wireless cope in Europe?
Huw Price-Stephens, Amino
You are right but MoCA allows for cable to be used and we are seeing Ethernet modulated around the home to get signals into devices. Wireless can be used but if there is an existing physical infrastructure in place, then use that.
Ian Valentine, Miniweb
Wireless should be built into every STB designed. This might seem a surprising comment but even though it is less robust, let me tell know why I think it's critical. When Sky rolled out their STBs, their installers plugged them into the telephone line and that delivered a return path that was capable of monetising interactivity. The analogy is that you put WIFI onto the STB so that when the consumer unpacks the box and plugs it in, it automatically finds a WIFI signal. Getting the consumer started is a pre-requisite for discovering and using broadband video. If the signal is not robust, they'll find another method but getting them connected the moment they unpack the box is the first step.
