One of the more interesting dynamics surrounding the announced CenturyLink-Qwest merger is the implications for video and IPTV. Generally speaking, if you ask the IPTV vendor ecosystem, a boon would be welcomed.
Maybe the impact won’t be along traditional IPTV lines. As industry analyst Steve Hawley commented on our original CenturyLink-Qwest merger post, “Perhaps a new IPTV-video strategy will rise like a phoenix… This is actually a very interesting time for a complete strategy reset.” Interesting observation.
Here is what we do know. Qwest and CenturyLink have gone down very different paths, relative to a video strategy. That’s going to have to be reconciled in some way. Qwest has taken a pass on IPTV completely (even though they were a pioneer in switched digital video) and has chosen satellite TV resale as their sole traditional subscription strategy. They’ve sniffed around OTT video with ZillionTV, but there’s no clear direction on where that’s headed.
CenturyLink on the other hand has pulled the IPTV trigger and has a few IPTV markets up and running, with Las Vegas rumored to be in the pipeline. They have north of 20K video subscribers (although some of those are traditional HFC cable subs). They are using Microsoft’s Mediaroom platform over a variety of access methods including ADSL2+, VDSL, and limited FTTH deployments.
Given CenturyLink’s appetite for doing IPTV over DSL, and Qwest’s growing VDSL footprint, will we see a dramatic expansion of IPTV into Qwest markets? Current Qwest CEO Ed Mueller said on the merger announcement conference call that CenturyLink’s IPTV could potentially provide “additional options” in Qwest territories. Not exactly “full speed ahead,” but not a dismissal either. Since these mergers typically take a year or so to close, will they wait that long to begin some IPTV trials? I know an IPTV vendor or two that hope not.
The other video issue to be resolved with this merger is DBS resale. CenturyLink dances with DISH Network and Qwest with DirecTV. It’s unlikely that the combined company will offer both. It’s somewhat reminiscent of when AT&T (a DISH partner at the time) bought Bell South (a DirecTV partner at the time) and faced the same conundrum. DirecTV ultimately won that sweepstakes when AT&T decided to end their resale arrangement with DISH and go exclusively with DirecTV. Is it curtains for DISH Network again?