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Advertising Drives Telkom Indonesia's Big Video StrategyTelkom Indonesia (NYSE: TLK) is integrating its IPTV and DTH subscriber base, partnering with a broad spectrum of content providers and looking to multiscreen advertising to help monetize its Big Video vision, according to Joddy Hernady, project director at Telkom Indonesia. The Indonesian incumbent has followed an aggressive transformation program since 2008, aimed at "transformation not just of the core business but of the infrastructure, systems, organization and human resources, as well as the corporate culture" in response to growing competition," Hernady said. He explained that PT Telekomunikasi Indonesia Tbk. (Telkom) wanted to take advantage of regulatory changes and undertake a comprehensive upgrade to leverage newer technologies. The sense at the time was that user behavior was changing, and new services and capabilities would be required to cater to it. Today, Hernady said, Telkom Indonesia is building on that transformation to launch its new video strategy. It has developed a three-point program aimed at integrating its core TV business across the IPTV, OTT and direct-to-home (DTH/DBS) satellite platforms. It is also focusing on its potential as a digital enabler, by taking on a "mediation" role for digital services. Plus, it is launching new services by taking "selective bets in key applications" by partnering with emerging providers. To do this, Hernady said, the operator is taking three steps: It is offering partners access to its billing relationship with its subscribers; it's refining and sharing its subscriber data, which it hopes to use more effectively; and it's developing new ways to generate advertising revenue across multiple video screens. Such a partnership strategy built on the opening up and sharing of back-office resources is similar to successful approaches used by other operators such as NTT DoCoMo and China Telecom. Telkom Indonesia offers an FTTH-based IPTV service to 1.6 million homes today, but expects to increase that to 3 million by year-end 2016, and more than 10 million by year-end 2020. It also offers a hybrid DTH satellite TV service coupled with OTT video for homes still on the copper network. The TV service is offered free with certain tiers of broadband subscriptions. The operator also offers a mobile TV service, which is bundled with certain mobile broadband packages and includes live streaming, VoD and user-generated content. This is produced with local and international content partners, and the operator is also producing some content itself. The TV services are ad-sponsored, and the revenue is shared with content partners. Hernady said the operator now has about 75 content partners but expects to ramp this up to 200 in the future. OTT services are also being launched with additional partners. Multiple advertising slots are being offered, including pre and post-roll, in-show, overlays and in the interactive program guide. Hernady said Telkom Indonesia is also working to improve its user interface, which it considers important for the success of the service, and has begun to expand its own content production unit. Today it produces five different shows -- one of which is in 4K -- and more shows are planned. Emerging markets often develop very differently from established ones because they can skip generations of technology and because they are structured very differently. Big-budget US broadcast and Hollywood content is often expensive and requires complex negotiations to obtain, but may not be absolutely essential in some markets. As a result, operators can partner with local content providers to launch innovative services, and potentially even get more viable deals with Hollywood since there aren't a lot of alternate distribution options available in those markets. As such, the biggest constraint to launching innovative business models and new pay-TV services in markets like the US and UK may not be as significant in other regions. In fact, we may even see more Big Video innovation in emerging markets than in the more traditionally established ones. — Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation |
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Orange has been one of the leading proponents of SDN and NFV. In this Telco Transformation radio show, Orange's John Isch provides some perspective on his company's NFV/SDN journey.
Special Huawei Video
Huawei Network Transformation Seminar The adoption of virtualization technology and cloud architectures by telecom network operators is now well underway but there is still a long way to go before the transition to an era of Network Functions Cloudification (NFC) is complete. |
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