Remember the unforgettably rude sounds of the modem? It is astounding to think we all had to put up with that infernal racket only a few short years ago. And, at first only being able to connect just one computer at a time to the Internet, the richest content available was a .jpg photo.

Then – science! Cable, and later telco, operators began first to offer multiple computer connectivity and then Triple Play (Internet, telephony, and television). As dial-up became a thing of the past for most subscribers, competition between cable operators and telcos heated up. Television began to lose its virtual monopoly on the attention of people hungry for visual entertainment, ironically much as television produced a deleterious impact on motion picture industry in the 1950s and ‘60s.

Who says there’s no such thing as karma?

In concert, a renewed focus on the set-top box (STB) began to take place in the 1980s (or, as we like to call that disco-and-leisure suit era, “The Dark Ages”). Once just a lowly UHF converter that extended channel options well beyond the standard limit of 12 that came on most TVs (Honest, kids, we’re being serious here!), cable companies needed cable converter boxes to modify the channels being delivered to the home into frequencies that non-cable-ready televisions could show, requiring the user to change the TV’s tuner to Channel 3 and then use a remote control to change the channels on the STB.

Soon TV was rockin’! The STB enabled pay-per-view programs like world-class boxing matches to become all the rage, and a reason to have a party for friends, neighbors, and vagrants. Video-on-Demand let you see stuff when you wanted to see it. Home shopping! Movies! Porn! A new world was being made available, vying with the computer for your precious leisure time.

And then television went digital, enabling you to enjoy “Entertainment Tonight,” wrestling, and reruns of “Full House” with astonishing clarity. TV screens began to grow, soon dominating entire living rooms. And with faster Internet speeds allowing higher definition audio and video to be streamed into your home quickly, people began to question if it was such a great idea to schlep your ever-lovin’ and the kids to the movies when you could have your very own Orpheum Theatre right there in your cozy casa.

Why indeed? We’ve now got IPTV, bringing media right through the Internet to today’s STB, which is now in reality a computer on its own. No longer just a dumb receiver, today’s STB lets you communicate with your telco or cable provider. Many offer the convenience of adding a hard drive, allowing you to record your programs for later viewing. In fact, according to Gartner, personal video recorders will grow at almost twice the compound annual growth rate (32%) of standard digital set-top boxes between 2007 and 2012.*

IPTV makes sense. Trying to push video through a dial-up connection would be as successful as trying to send a rocket to Mars based on a design by Jessica Simpson. Add in a little rocket science, like with xDSL and FTTX technologies, and you find you’re pushing video better than through traditional coaxial cable. Basic broadband suffices for standard definition TV, yet you really need mid- to high-speed broadband for high definition. So what we’re seeing is service providers following the average broadband speed forecast to identify the tipping point for IPTV. A recent report from Strategy Analytics claims that by 2012, IPTV worldwide revenues will grow to $14B - up from $694M in 2007. We’re at the tip-over point, try not to fall off.*

Using the Internet as the means to deliver your programs brings features unavailable from the traditional head-end. For example, you can now easily get alternate audio tracks for programs. Even more useful, you can take advantage of social applications such as a chat room along-side prime-time TV, so you can share your thoughts on Dr. House’s irascibility with fellow fans.

And – ta da! – today’s STB is networkable! Faster than you can say, “Yo, Tony, bada-bing, bada-boom,” the former lowly STB has become capable of serving as your home gateway, connecting to the home’s Local Area Network (LAN). This now allows all your networked computers to receive high-quality audio and video streaming, connect to online gaming, and enjoy other marvels of broadband connectivity.

HOW-TO Bring the OSP Inside
How best to network your home? Well, if you’re really old-school, you could think about running coax to every TV in the house. But that would be messy, time consuming, and, well, stupid. Besides, the coolest products today including Wii, Xbox 360, PS3, and Blu-ray players come with Ethernet connectors, not coax. Obviously the trend is heading toward complete IP connectivity. So for home networking, those living in today’s world should opt for either HomePlug AV or 802.11n with MIMO.

HomePlug AV, the preferred flavor of powerline connectivity, uses your home’s existing electrical lines as the backbone for your home network. This is a far more sensible alternative to laying new wiring to every room. Cheaper too, since just about every domicile in the civilized world comes already equipped with electricity. Get a HomePlug AV adapter, plug it into a wall outlet and plug your computer into it. Then plug other computers into other adapters, and bingo, you’ve got a network with no dead spots. Unlike wireless networks, HomePlug AV is a snap to setup and offers great security since you don’t have your passwords flying through the air.

HomePlug hasn’t been a roaring success in the U.S., but with a home gateway in the mix, its stock goes way up. That’s because HomePlug AV delivers a data rate of 200 megabits per second with 100 mbps throughput, making it just the thing to churn multiple streams of video through your home.

Many predict HomePlug will be embedded in DVRs, notebooks and TVs – you get the picture (pun intended). It could also very well enable control of garage door openers, heating and air conditioning, lights, and blinds. So HomePlug AV becomes quite attractive as a means of blending your gateway into your network and enjoying IPTV, as well as controlling many of your home’s electronic amenities.

Alternatively, 802.11n with MIMO is also a great means to enable your computers to connect without wires. Although the 802.11n standard still has not been approved, many companies are testing and extending its limits, and Draft 2.0 brings the promise of compatibility. In this case, MIMO means Multiple Input Multiple Output, where multiple antennas handle input and output allowing for enhanced speeds and reliability at any given distance, both essential for movie streaming, which requires more speed and stability. An STB with 802.11n with MIMO connectivity can send and receive multiple HDTV streams over a robust and consistent wireless connection, providing seamless connection between the video source and the display.

Tomorrow’s STB will connect through the Internet for basic content (IPTV) that will enable new high-value features including social networking and multiple audio tracks within a program. This new STB will network TVs throughout the home with whole-home digital video recording. And as mentioned, opportunities for home automation are available, extending the network well beyond the Internet to the telephone, stereo, kitchen appliances, and other products not yet invented.

Do you need a home gateway? You bet. A cursory look at today’s economy will provide a rather convincing argument. Going to a theatre to see a movie can cost a family $100 real fast. Plus you get to thrill the hassle of fighting for a parking space at the local mall’s multiplex, and then fork over your hard-earned cash for overpriced popcorn, sodas, and bon bons. Next, try to focus on the plot while Sparky and Candi behind you provide a running commentary. Finally, fight the crowds trying to get the hell out of there. Rinse, lather, and repeat for live sporting events, concerts, and other former entertainment pleasures that you can now see from the comfort of your own La-Z-Boy.

With home entertainment becoming more popular with every passing bailout bill, preparing your home network for IPTV has become a prudent option for penny pinching families. And for this trend to come to fruition, your STB’s addition of necessary features depends on IPTV connectivity as broadband speeds improve to keep pace. Telco operators are today conquering the Last Mile dilemma while home networking technologies including HomePlug AV and 802.11n wireless solve the Last 100 Feet dilemma. As a result, we’re now witnessing double-digit growth in STB deployment, with IPTV driving revenue growth. ABI Research, in their Global IPTV Market report, predicts the IPTV market to grow from 13 million subscribers in 2007 to more than 90 million in 2013.* This, of course, is facilitated by FTTx in the OSP.

Quite a progression from that noisy little modem, eh?

 Lewis Lustman is Director of Marketing for ZyXEL. For more information, please email him at lewisl@zyxel.com or visit www.zyxel.com.

* For more information about:
ABI Research, visit www.abiresearch.com.
Gartner, visit www.gartner.com.
Strategy Analytics, visit www.strategyanalytics.com.

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