Developments on the Latvian TV market

For most Latvians, television is a service that comes over the net, so it rightly belongs in a telecoms blog. And anyway, what is telecoms? More and more, it is using a computer with a voice/video chat function. I am not only talking about Skype and its clones, but also those computers with voice functions that we call smartphones, such as the iPhone4s.

There has been a big hoo-hah about television in Latvia, mainly because of a big merger between a subsidiary of Sweden's Modern Times Group (MTG), TV3 and another privately owned TV company Latvijas Neatkarīgā televīzija (LNT). TV3 and LNT were both loss makers in a drastically reduced advertising market and it was a matter of time before LNT would go down first, taking a pretty talented crew and substantial audience down with the ship. So the move was necessary, and, even if it established a kind of Swedish monopoly on commercial television (with lots of restrictions imposed on the deal by Latvia's Competition Council) it was still better than the alternative of LNT going down or being sold to some murky Russian media group.
Up to now, both channels have been paying customers of Lattelecom, both for its terrestrial digital broadcast services (with the digital signal also going out over Lattelecom's interactive IPTV service). Oddly, Lattelecom's CEO Juris Gulbis spent quite a few tweets criticizing the merger, even though both were his customers and it really didn't matter who owned them as long as they pay their bills. In 2013, if amendments to the Electronic Media Law are passed, it will put an end to something called “must carry” and both commercial channels, hitherto broadcast over cable and internet networks for free, will be able to charge cable operators and, eventually, viewers, for watching them. Kaspars Ozoliņš, the CEO of MTG Baltics says the extra revenue will allow him to expand locally produced programming on both “national” commercial channels, thereby retaining and increasing his audience and the base for future advertising.
It may, however, be too little and perhaps too late. A lot of cable operators are saying they will relegate both national commercial channels to premium packages with fewer viewers, defeating the purpose of increasing the number of viewers. Others will pay but won't pass on their costs to their viewers (the head of a small cable TV operation in the town of Kuldiga told me this). Still others may use their cable networks as “common antennas” and feed the terrestrial digital signal (still for free for all of 2013) to their viewers. Those who have modern television sets with built in digital decoders will see the feed effortlessly, others may have to rig their Lattelecom terrestrial decoders to the cable network. So it looks like lifting “must carry” will not exactly free the Golden Goose to go flying into the coffers of MTG.
An interesting and still struggling free internet TV operation is draugiem.tv, launched by the social network of the same name. Its assortment of channels is still limited, but still includes BBC World. It seems that the commercial Latvian networks see it as an upstart and have blocked draugiem from using their signal. Look for a proliferation of internet TV and TV aggregators in Latvia as entrepreneurs discover how relatively easy this is to do.
On another note, I tested the new random videochat application Airtime.com. The jury is still out. I ended up talking to an internet entrepreneur in The Hague, told him about TechHub Riga. Before him, some murky faces appeared (bad lighting, bad cameras), not eager to talk. So it could be another Chatroullette, which by many accounts degenerated into a series of exhibitionists looking for random “viewers” of their attributes.

100 Mpbs--Latvia's new (lower) speed limit?

There haven't been any real dramas in the Latvian telecommunications market, so I have been remiss in blogging. However, these past few weeks it has become apparent that the new internet speed benchmark is soon going to be 100 Mbps. IZZI and Baltkom have already started offering cable internet with such speeds in parts of Riga. Lattelecom has completed a pilot project of 100 Mbps fiber to the home (FTTH) in the Zolitude district of Riga and hopes to replace most of the DSL network in most of Latvia with FTTH in three years.

100 Mbps is starting to feel like a commodity even as only a few hundred users are actually getting it, so that the operators are launching marketing campaigns to make their products stand out. IZZI has adopted a peculiar sado-masochistic tone to its ads, offering "internet speeds that spank you" and even conducting a marketing action at the Forum Cinemas Parex Plaza multiplex feature models in leather(vinyl?) with whips. Baltkom called its 100 Mbps offering a "Next-Generation-Network" (NGN), although elements of NGN (Lattelecom's use of MPLS) have been around for a while. The interesting thing one can read into the emphasis on NGN is an implied warranty of quality of service (QoS). In other words, Baltkom is saying that it will deliver a consistent "best effort" close to 100 Mbps.

IZZI talked a lot about delivering excellent customer service, which sounds to me like another promise of  QoS. What is the point, after all, of having a customer service rep pick up after three rings if he/she cannot fix a complaint about a slow or lagging connection? 

Lattelecom notes that its 100 Mbps FTTH offering is only the start-- it hopes to jump to 500 Mbps by the end of the year or early 2010 (for some users at least). What you do with 500 Mbps in the home (unless you have a small data center in the basement) remains to be invented. 

Both Baltkom and IZZI are offering combined internet and digital cable packages. But if the connection carrying both is going to offer such high bandwidth, what will you fill it with? Both operators have a handful of high-definition (HD) channels (two or three at most). Big deal...

Meanwhile, Lattelecom is said to be part of a project to transfer many Latvian films (both classic Soviet-era favorites and newer films) to HD for streaming on demand.  Having a wide collection of HD movies (Latvian and international) for rent on demand makes sense, assuming there is a audience with the equipment to watch it. With the present economic crisis, and the price of HD flat-screen televisions falling (including obscure brands sold at hypermarkets), it remains to be seen whether a substantial HD audience will develop. With salaries falling by 20 % or more, I don't see an 40 inch HD TV set at the top of most family shopping lists. Indeed, insofar as many HD sets may have been bought during the wild credit boom of recent years, one can only hope that these luxury goods are low on the list when the banks start repossessing the chattels of an increasing number of Latvians who are delinquent or in default of their loans. 

TeliaSonera's broadband honcho speaks

While in Stockholm on Friday, November 16, I had an opportunity to interview Erik Hallberg, TeliaSonera's head of Broadband services. He has a few interesting things to say about HDTV, the rising demand for bandwidth, fiber to the home, and whether telecoms operators will become media companies. And, oh yes, some remarks about the relationship between content providers and operators increasingly selling flat-rate commodity services.

Here is the video:

Click To Play

The Venice Project - not news in Riga :)

Bloggers have been peeking at The Venice Project and, among other things, noting that it offers some kind of social networking tool (chat or whatever) while watch the TV streams. This is nothing new and has been offered for some time now by Lattelecom's IPTV service available (to customers) through the Apollo internet service. Users can chat in a rolling window as they watch shows. Whether this is a good or necessary thing, you can (if you read Latvian) judge for yourself. Mostly, it seems to be cryptic chatter between teenie-boppers (the few times I have looked at it, Lattelecom IP TV doesn't work on Macs :( :( ) .
I wish both original Skypies success. but to add chat to video streams is nothing new. The screenshots, however, don't look bad :).