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Asia embraces triple-play apps

Posted: 06 Sep 2005 ?? ?Print Version ?Bookmark and Share

Keywords:wired? wireless? ip carrier system?

Wired and wireless infrastructure investments in Asia have boosted hopes for the thriving arena of triple-play network applications. Converging video, voice and data in a single IP carrier system has definitely begun in the Asian region and industry bigwigs are positive that this will further intensify its position in the wired and wireless spaces.

Triple-play is largely an initiative of incumbent telecom providers aimed at their residential (consumer) customer base. Prices and demand for wireline voice services are falling due to the maturity of the market and the convenience and better features of mobile-phone services. Internet access (mostly DSL) is seen as just a commodity transport, since it is the content providers that give high-value to the Internet.

The strategic threat to telephone companies is especially great where cable TV is strong because video is a higher-value service than voice and data. Thus, telephone companies are aiming to provide voice, video and Internet access to add more value to that offered by cable TV operators.

Ready to play

"I think Asia is well-prepared for triple-play," said Phil Bourekas, VP of worldwide marketing at Integrated Device Technology Inc. "As a consumer, I envy Asia in terms of being ready to do this," he added. Major cities in Japan are already providing high-bandwidth infrastructures that are slowly meeting growing demand for the technology. Moreover, leading-edge video capabilities in countries like Singapore tend to move them up the value chain and place them ahead of the average growth curve.

In its recent $1.7billion acquisition deal with Integrated Circuit Systems Inc., IDT did not just expand its operations to support the computing, communications and storage segments, but also took a crack at the consumer market. Bourekas said that the pact between the two companies provided IDT with the opportunity to continue to use its current resources such as its Oregon wafer fab. "If we can use that facility to drive more products and build its ICS technology, we'll increase the profitability of that business even further," Bourekas said.

Triple-play signifies the convergence not just of services, but of networks as well. Today, platforms are being developed for Edge in wireless infrastructures that are being deployed in wireline as well. While radio network controllers, media gateways and DSLAMs can currently function with a backplane bandwidth of about 600Mbps, multimedia and triple-play services will drive the requirement for interconnect throughout the Edge networks.

John Hartley, Asia-Pacific general manager at Tundra Semiconductor Corp., believes that the emergence of triple-play services will shape both wireless and wireline network architectures over the next five years. "In my view, Asia is very well-placed to embrace triple-play applications." Hong Kong, he said, is a notable example of where IPTV is rapidly being deployed. "South Korea and Japan have certainly led the way in introducing new wireless data services, so it is likely that triple-play services will roll out there soonest," Hartely said.

Countries undergoing rapid development such as China and India also seem to have the best chances of ramping up triple-play packages, said Michael Kennedy, co-founder and managing partner of IT and business consultancy firm Network Strategy Partners LLC. "If the focus is in the applications rather than the triple-play package itself, then Asia's wireless operators in the most developed markets are well on their way to wireless video and integration of Wi-Fi 3G," he said.

"It's a race," Bourekas said. "Korea has an impressive infrastructure for broadband capability, Japan is up and at 'em with its mobile segment and China is strategically placed as the overall investment site for such applications. Only time will tell who will emerge as the top dog."

However, Frank Capellari, business development manager for Asia and Japan at Agilent Technologies Inc., reminds industry players to keep everything in perspective. Although Asia is a promising region for the future of triple-play applications, Capellari believes that there is still more work to be done in terms of providing the services and infrastructure.

"Korea is playing big in using voice and data because it hosts a lot of broadband implementations. But I don't think video is quite ready to be able to pull off such a great demand," Capellari said. As such, he continued, companies start to look at places like China. "However, triple-play advocates need to contend first with some of China's regulatory constraints. TV broadcast there is currently provided by a certain group of organizations, while the telecom infrastructure is handled by another group. So at this point, there is no deregulation and it's all still very separate. I think that if and when they deregulate, we will see a different picture."

Industry impact

If triple-play applications stick to a "me-too" offering such as that of the cable TV industry, then the impact won't be too great other than getting cable TV into areas not currently served, or taking shares away from weak incumbent TV providers, said Network Strategy's Kennedy. However, if efforts are made to compete through service innovation then quite a bit of new equipment and service is possible. Wireless providers are especially interested in providing video on mobile devices.

Another major issue is who will control content. With 10Mbps+ Internet download capabilities, there are no technical reasons why consumers can't obtain video from content owners over the Web just as they obtain streaming radio and low-quality video today. However, since phone companies are investing in triple-play to improve growth and profitability, they will very likely rate-limit competitive offerings so as to favor their own premium-priced video packages.

From May to March of this year, Hartley said, several new WiMAX 802.16 designs have already deployed by some wireless OEMs. Furthermore, he said that "there are efforts for new backplane architectures being considered in wireless and wireline systems in anticipation of supporting triple-play services, and some equipment providers are leading the way with these new system designs."

While there is much work to do, the technology is well ahead of the infrastructure and business planning. The big systems vendors are desperate to increase sales and are hyping triple-play just as they hyped ISDN, DWDM, ATM, MPLS and other innovations in the past.

Since nearly all networking service markets are controlled by only a few large players, large-scale commitment to new infrastructure will only happen when the incumbents see a real strategic threat and all easier alternatives of quelling competition (i.e. law suits, new regulations, buying out the competitor) have been exhausted.

- Rey Buan Jr.

Electronic Engineering Times - Asia

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