Is cable subscription model under threat?

At the Adage Digital Conference this year, high profile speakers including Verizon’s Chief Marketing Officer John Stratton discussed how IPTV is affecting the cable TV subscription model. Although the view was largely taken from a US TV market point of view, John Stratton acknowledged that IPTV is indeed forcing viewers to cancel their cable TV subscriptions and explore online alternatives such as Hulu, iTunes, Amazon Video and TV.com. These fast growing online services are all based on non-subscription based models including transactional, premium, ad-supported models.

John says that the cable subscription model will continue to exist for certain distributors as long as content providers keep their costs down. On the whole, the general trend suggests that the subscription model for TV is being challenged by rapidly evolving online content providers, but forces are already at work for content providers, distributors and advertisers to start offering IPTV services that are built on simple and flexible model.

You can watch the full speech in below 3Minute AdAge video.

Cable & Wireless launches UK's first nationwide IPTV platform

Cable & Wireless has announced a £70 million deal with Inuk Networks which will see it enabling the delivery of television, telephony and broadband services.

The service will be delivered through Inuk subsidiary Freewire which currently has an initial focus on the student market, with over forty universities representing over 100,000 student rooms. Cable & Wireless will also white label Inuk's IPTV platform to other wholesale DSL customers that want to provide their customers with a digital television offering.

IPTV has yet to take off in the UK. BT Vision is the only other provider to offer IPTV services in the UK, but it can’t do multicast unlike Cable & Wireless. Freewire has an established customer base in an influential market sector.

But it remains to be seen whether Cable & Wireless will benefit from a first mover advantage albeit to a limited market segment. BT Vision hasn't done anywhere as near as well as expected, so this is the operator's chance to take a leadership role in an emerging market.