USA - Verizon triple and quadruple play

Wireless Won’t Necessarily Square with the Triple Play

As the third anniversary of Verizon Communications Inc.(VZ) launching FiOS arrives in September, carriers, their infrastructure suppliers and industry analysts still lack a clear view of what will comprise the quad play.

At least in general discussions and industry forums, it had all but been a forgone conclusion that wireless would join the triple-play line-up of wireline voice, TV and Internet access. But times have changed to the point that the fourth component likely won’t even be a network service. Instead, the fourth element more likely will be an added capability or major enhancement to an existing carrier service or services. Such capabilities and features may leverage wireless networks and mobile functionality, but not necessarily.

A case in point is IP services innovator SureWest Communications Inc.(SURW), which earlier sold its wireless assets to Verizon. Though it won’t rule out someday reselling wireless services, for this company adding to the triple play means introducing major new features to what it currently sells.

“Our main focus is ensuring that what we roll out are solid and reliable services, which we will continue to add major enhancements to, with customer service meaning much more than a phrase,” said Bill DeMuth, CTO of SureWest. “Sometimes you rush to get a service out and have to catch up in areas of service quality and reliability.”

That was the case with SureWest’s IPTV service which it launched, then substantially enhanced with high-definition content and again, later, with HD DVR functionality. “That’s why we call our customers after installs to see if they need help with anything or if there’s something they’re struggling with,” explained DeMuth. “This alone represented a lot of change for the customer, and that’s why I believe there are plenty of opportunities to differentiate yourself through customer service.”

While customer service may only be a service in name, DeMuth sees it as a core element to be added to current services, and to drive enhancement and creation of others. The company also launched a Web-accessed home video monitoring service earlier this year, while continuing to increase the speed of its symmetric, high-speed Internet service to a maximum 50/50mbps of theoretical throughput.

Jeff Heynen, directing analyst for IPTV and Next Gen OSS/BSS at Infonetics Research, sees layering additional capabilities atop home TV service as the next element of the triple play. These capabilities tend to be software-driven and centered on media sharing within and beyond the home.

“The next big service in the bundle is home media, which includes sharing your recorded content, pictures, home videos, etc., across multiple set-top boxes, cell phones and iPods in the home,” said Heynen. “It also includes sharing your home movies, photos and music on a channel that friends and families can be authorized to access — like creating your own HBO.”

Heynen claims the first piece is something Verizon is doing with FiOS and adds that the take rate has been “phenomenal.” AT&T Inc.(ATT), with Microsoft Corp.’s(MSFT) MediaRoom, has the capacity to layer on more capabilities that will help U-Verse subscribers “achieve that multiscreen vision. I think that’s a huge reason why the large cable companies are backing Clearwire.”

Announced this past spring, Clearwire is a mega-billion dollar effort by Comcast Corp.(CMCSA) and others to build out a nationwide WiMAX network.

Heynen also sees an opportunity to introduce social networking into the static and linear living room TV environment.

“MySpace, Facebook, Twitter and blogs are all about sifting through the enormous amount of content on the Web, finding what’s relevant to you, and then creating and building a community that shares your preferences,” explained Heynen. “This is the way to do it with TV content. Broadcasters are beginning to do this on their own Web sites. But they won’t see major uptake until they can replicate it in the living room.” The cable industry’s open application platform initiative, dubbed Tru2way, also will “help make this type of service a reality.”

While Verizon owns gigantic wireless assets, the company’s wireline unit has been focused on evolving its triple-play bundle by adding breakthrough capabilities. Most all of those new capabilities have been focused in its TV service, but the telco also has won acclaim by quickly and broadly rolling out its 20/20 symmetric Internet access offering — something cable rivals have yet to match.

On the TV front, while most all providers were focusing first on HD content, Verizon became the first large telco to roll out a multiroom DVR capability. Launched last summer, the offering enables content recorded on one room’s DVR to be viewed on any TV within a dwelling — and without the requirement of an additional DVR(s). At press time, AT&T was expected launch a similar offering some time this year.

Verizon also added wireless-enabled functionality early on for FiOS TV, allowing customers with certain mobile devices to control their home DVR remotely.

Adding feature functionality and additional capabilities to current triple-play bundles requires service providers to re-examine their network infrastructures to ensure they’re building atop a strong foundation.

“Tying other services and applications together isn’t going to be enough,” began Robert McIntyre, CTO for Cisco Systems Inc.’s(CSCO) service provider group and a 17-year veteran of Scientific Atlanta. “To do a quad play, you need to have converged, IP networks. It’s critical that services be driven from the network.”

Legacy networks make delivering and maintaining bundled services far more than just super heavy lifting from a technology perspective, the Cisco CTO said. It also makes them very expensive to provide in terms of dollars and staff resources. That obviously eats into revenue generated by their use.

McIntyre sees the IP network foundation as being essential to providing the bandwidth needed to deliver quad play to the home. “You’ve got to have 100 megabits to the home for this to work. Some had presumed that their [legacy] networks would take care of all problems. But when video was dropped in, they found that service quality suffered dramatically.”