Television From Your Telephone

What's more, the software is also designed to work with so-called digital rights management, programs that attempt to thwart digital piracy by limiting how long a particular piece of video content may be accessible to a home consumer.

Jeff Paine, vice president of strategic marketing at UTStarcom, says that this type of distributed network setup helps minimize any possible data traffic jams to the subscriber's home.

"If you try to move all this digital content around from a central location to millions of homes, you're going to load a network down and kill it," said Paine. "We have a tremendous [storage] capacity -- 40 terabytes of data -- at the network's edge, at the switch. [Subscribers] just download the parts that are needed from the edge of the network." That's roughly 40,000 gigabytes, or about 1,000 times more storage than that found on the cheapest PCs.

A Shift From Prime-Time and PVRs

Paine believes mVision's capabilities will attract both content creators and phone companies to develop a new paradigm for television entertainment.

For example, UTStarcom has already developed an mVision application called the Network Personal Video Recorder, or n-PVR. This feature would digitally encode and store every episode of a particular TV show or series and make it available to subscribers.

While current stand-alone PVRs such as TiVo and ReplayTV already offer this feature, Paine says PVR users have to understand how to set up the feature to take advantage of it. With a network-based PVR, subscribers would essentially have a video library of shows available to them at any time. So, if a subscriber is just getting into a particular TV series -- say, after they've heard friends rave about the latest police drama -- they could access the previously aired episodes online and never miss another episode going forward.

What's more, Paine believes that such a feature could be attractive to show creators and other content partners. Rather than rely on programming times, networks and ads, content providers could develop their own "channels" -- and garner revenues directly from the subscribers using mVisions tracking and billing software.

"On the macro level for content providers, they've never been in love with current distributors. They would love to get more money [for their programming] than they get," said Paine. "If you look at [mVision] as a direct-to-consumer model where middle men go away, they keep more control -- and get a larger piece of the [revenue] pie."

Will Content Get in Line for Online?

Industry analysts such as ABI's Sistla say that the new TV entertainment options that TVoIP systems such as mVision offer could definitely help phone companies compete against cable TV and digital satellite offerings.

"Telcos can say [to consumers], 'Cable TV offers you hundreds of channels that you pay for but don't watch. We'll give you just the channels that you want to watch, when you want to watch,' " said Sistla. "Cable TV and satellite systems already have invested millions [of dollars] in infrastructure that won't allow for that level of a la carte customization. At most, they have one or two channels or genres of video-on-demand. That's not good enough for the current generation that want to watch only what they want."

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