IP-News: Telecommunications operators have massively begun to launch IPTV services. Is it safe to say  that “Netris” takes part in that process, too?

Alexei Bugai: I’d like to answer that question by taking a look at the past – initially Netris had specialized at the development of software for IP-networks using the brand IPSoft. Especially for the first Russian project of the IPTV system implementation we created IPSoft iVision IPTV Middleware, a carrier-class program platform. In 2005 it was followed by the first edition of a platform for digital television broadcasting by means of IP and now we are close to the launch of its third edition. During this time we’ve widened the range of IPSoft products by adding to it a video server, content distribution system and software client for IPTV services delivery on user-class computers.

After having got several projects on wheels we decided to open a new department – system integration of IPTV projects. In some cases Netris produces end-to-end solutions which involves network’s preparation, as it was in the case of JSC “Kazakhtelecom”, but our priority is link-up   of its components using the software connectors. That’s the way to get all the elements of the system to communicate and interact with each other using one language. A huge advantage in doing so is preliminary integration of the components which we do using the products of the leading vendors in the industry. That allows us to shorten the time of the implementation and cut down the costs.

IP-News: What components the standard IPTV system is made of? 

Alexei Bugai: First of all it’s middleware – a platform enabling the services management basically  being the crucial element of the solution. Then I’d name various content protection systems (CA/DRM). As you may know it, providers must guarantee to the copyright holders the content safety from unauthorized access or copying. In end-to-end IPTV solutions we use the qualifying access systems. All our products are compatible with CA/DRM SecureMedia, Verimatrix, Irdeto and NDS systems. 

Also I’d name the Head End which usually is installed for receiving, decoding  and transcoding and finally broadcasting of video streams. Depending on the scale of the given network and the number of channels the appropriate hardware will be chosen and applied for the implementation of the project. 

Additional services such as VoD, nVoD, TimeShift, nPVR are launched after the installation of VoD software and soft- hardware servers. In doing so both Russian and foreign solutions may be used. The product of our own – IPSoft iStream enables interactive videoservices not to mention the standard ones. Our DMA solution for VoD services is compatible with videoservers of the wide range of vendors.

All of these things is the hardware used by IPTV provider. Users only get to install sort of receiver - Set-Top-Box. But Netris also offers the software solution of its own which abolishes the necessity of such things.

IP-News: Besides integration of IPTV enabling systems the whole solution must be compatible with the other IT-systems. How this is usually solved?

Alexei Bugai: That’s right – you can’t forget about other IT products which is used in various business processes automation. For instance, every telecommunications services provider uses billing systems and it should take into account the data from the IPTV system. It’s usually achieved by the integration of middleware and billing systems – once interfaces are compatible with each other both systems get access to the new data.

We use one of the most popular billing systems – Onyma. But, due to the current abundance of such systems it’s impossible to perform preliminary integration with all of them. That’s why integrator’s role is reduced to the producing of the additional software which makes both systems to be more “friendly” to each other.
Apart from the billing telecommunications services provider may have some CRM-systems installed and it’ll require the integration with IPTV-system components on the software level as well. The Netris’ role therefore is to ensure the program integration of the components and the key-function of that process is assigned to the middleware component.

IP-News: What standard IPTV services package is usually made of?

Alexei Bugai: The most common installation set is broadcasting of a certain number of digital TV channels without any additional services. In that case it’ll be sufficient to have CA/DRM system, Head End and user-class hardware.

But if VoD-services are under way, too, it should be ensured by at least two solutions of Netris: IPSoft iStream and IPSoft DMA. It allows to enable a virtual movie theatre service (nVoD), video recorder (nPvR), TV rebroadcast (Time Shift TV), Internet TV, recording the content on the HDD (Progressive Downloading), and pausing the broadcasting with the possibility to restart it later (Live Pause TV).


IP-News: As you have mentioned Netris had produced a solution which abolishes the use of user’s hardware - STB. Could you provide us with the details?

Alexei Bugai: It was released in early 2008 and it’s called IPSoft iVision PC Solution. Its main feature is turning computer into IPTV client, literally a choice alternative to the Set-Top-Box. Some time ago copyright holders wouldn’t let users view the content on the computers because of the lack of security opportunities, but later on it was solved by quite a number of software developers who started to produce special solutions protecting the content. Netris cooperates with such companies (Verimatrix, SecureMedia) in order to build PC Solution. It’s being made of two parts – content decryption (Verimatrix, SecureMedia) and interface coupled with managing features (Netris).

Solution of this kind provides substantial cut down of the price and increases the availability of IPTV services to the operators and users who should be ready to pay for such software something in the neighborhood of 600 rubles.

IP-News: What is the demand on this program client?

Alexei Bugai: During the last year we implemented IPSoft iVision PC Solution in the “Central Telegraph”. The service which this operator is now delivering using our solution, is being promoted  under the brand TeleQ. It also uses Set-Top-Box.
In order to live up to operators’ expectations we’re constantly working on this solution. At the moment this PC clients is absolutely equal to STB by its applicative functional and maybe exceeds it in some ways. For instance, a user ay record a TV program on his computer HDD and watch it any time later. There’s more – the preferred content may be simply downloaded by the user from operator’s web-site. CA/DRM system’s component, installed on the user’s computers will decrypt the film or program every time customer is willing to watch it.

IP-News: How clearly the operators nowadays can express their needs concerning IPTV services? Do all of them really know what they want?

Alexei Bugai: Unfortunately there are very few companies that know for sure what services they want to provide as part of IPTV. Most of them follow their colleagues experience. These services are new to the entire market and the demand on it isn’t very obvious. So the viability of such projects involving the implementation of some additional services isn’t that transparent for the investors. At the moment telecommunications services providers practically don’t use additional IPTV systems functional, which in theory could raise marginality of these services.
Consequently IPTV services today are more of a good business image features than sort of a new earner for businesses. Nevertheless the services remain quite promising especially in the perspective of different technologies convergence known as Triple Play. Thus, IPTV services for fixed-line and mobile users in the future will become an important tool in the struggle between competing providers.

IP-News: Does the business model of IPTV services delivering influence the configuration of the implementing system?

Alexei Bugai: Yes, it certainly does. Talking about the classical IPTV delivering scheme we mean middleware installation, Head End and CA/DRM system. Users get the access to the services via STB.

If customer wishes to have VoD functional enabled, this scheme is supplemented with videoserver which also broadcasts the content to the STB. All the software and hardware is placed at the operator’s capacities.

As of now, the new schemes of IPTV services delivering through agent-based payment system. Small telecoms get to implement these services in partnership with content-providers, usually the bigger companies having direct contracts with majors.

These providers may offer content and interactive services through several business models. First – all the equipment is taken on lease by the local telecom from its bigger counterpart. Second – local telecom also installs middleware server acquiring the possibility of looking after the services’ using. The third way – local telecom has both middleware and video servers. Thus it reduces traffic between itself and the bigger operators but it’ll cost to the company some money to pay for the necessary equipment. Under this scheme encrypting the content and Head End functioning is managed by the content-provider.

IP-News: How much time does it take to implement IPTV system? Is it possible to evaluate the costs of the implementation?

Alexei Bugai: Of course, it depends on the functionality and complexity of the system. Talking about the terms of implementation let me refer to the example of such project in the “Comstar-Ukraine”. This project wasn’t of any specific character - it involved the installation of the equipment for IPTV. There were as many as 1 thousand subscribers. After both hardware and software were installed the integration of all the components took two weeks. Evaluating the costs one should remember that they’ll be depending on the services set and the configuration of the system. For small telecoms working on the agent basis the costs will be the sum of the price of STB and subscription fee to the content-provider. If the agent gets the simplified system of the content management the investment could be several dozen thousand dollars.
The full integration of the IPTV system in the operator’s network including the head-end, middleware and videoserver will be costing starting from $150 thousand.

IP-News: You have mentioned that now the functional of these systems is not used at the full scale which limits the opportunities for the raise of the services marginality.

Alexei Bugai: At the moment IPTV is very much new and the market doesn’t really understand   the basic level of the services therefore additional ones aren’t even in the sight of most of the companies.

If we go into details, I’d like to stress that VoD (video on demand) isn’t really used. Also there’s number of services – TimeShift, Replay TV, Live Pause TV – who share the same fate. But that has a lot to do with copyright holders’ policy. If operator will be given the opportunity of delivering all the services mentioned above it will have the opportunity of recording the content and this enables the possibility of skipping the commercials which is inappropriate for the majors.

Besides that, using statistics and interface’s personification provider gets the tools for enabling context advertising, opinion polls and video quizzes with remote control buttons as means of voting instead of the telephone.

IP-News: Basically the market of telecommunications solutions is made up of the vendors which produce end-to-end solutions meanwhile there isn’t much of middleware makers. How would you describe the competition level in this segment?

Alexei Bugai: The main difference of in this respect is that we operate with the solution of our own development. We took part in a number of significant Russian and CIS IPTV projects. Perhaps, there’s only BCC can be named as our real competitor in this field. They implemented a very complicated IPTV solution for JSC “North-Western Telecom”. But BBC mainly use foreign made solutions.

IP-News: Will the level of competition raise in this segment of telecommunications market? If there’s a space for new companies?

Alexei Bugai: The IPTV market at the moment is a very impressive picture where all the characters are trying to occupy a lot of space. There’s a lot of foreign companies present, but there’s no wonder – Russian market is very attractive to the western vendors. However, I doubt that in the nearest future we will see some new significant companies emerging. One of the crucial advantages of vendors and integrators is positive experience of the implementation and newly created businesses has little chance to catch up with the leaders. The only direction where the new firms are welcome is Set-Top-Boxes production.