There tends to be a lot of confusion around the term IPTV. It doesn’t mean video streamed over the free-and-clear Internet like YouTube. It means television that is streamed over a regulated IP network. In other words, IPTV requires some service provider manage the quality and security of the television experience.
Yesterday Google warned publicly that the Web cannot support broadcast-quality Internet TV over the long term. The system won’t scale. So what does Google plan to do about it? Apparently the company wants to work with cable operators to “combine its technology for searching for video and TV footage and its tailored advertising with the cable networks’ high-quality delivery of shows.”
This is a very interesting proposition. My opinion has always been that Internet and television companies will have to find ways to work together because neither can support everything in the television 2.0 world. However, will the ultimate solution turn out to be a few marriages of convenience between Goliath-sized companies? Or are we seeing a window of opportunity for smaller companies that can bring competitive advantage to one or the other side? For example, there are some very good video search companies doing very innovative things right now. How much does the cable industry need Google? (This is a serious question. I don’t have the answer to it.)
On the back end of things, Google is admitting it doesn’t have the infrastructure to support television delivery. Does this mean that operators have the upper hand because of their existing distributed networks? Or does Google have an ace up its sleeve with their huge amount of storage and processing power? How attractive are Google’s resources when paired with the company’s ability to charm consumers and make Wall Street happy?
Honestly, this has all the makings of a geeky choose-your-own-adventure book.
Update: Mark Cuban blogged last night on the Google news and pointed back to a detailed post of his from last year discussing this very issue. Worth a look.