Despite the continued growth of the IPTV market globally, it clearly is facing an uphill battle in North America, which has caused SES (News - Alert) Americom to announce it is pulling the plug on its IP-PRIME service in the region as of July 31, 2009. The move comes only a month after the provider boasted of its success promoting its IPTV (News - Alert) solution, for which it said more than 65 telcos in 31 states have signed up.

 

Despite the relative success SES has enjoyed signing telcos — it says some three dozen or so were expected to have turned on the service by year’s end — a lack of subscribers has created a situation that is economically not viable, especially in this economy. According to Rob Bednarek, President and CEO of SES AMERICOM (News - Alert)-NEW SKIES, the company currently has fewer than 10,000 subscribers after more than two years of operation.

 

Clearly, the subscription rate does not warrant continued operation of the service for SES Americom, and the question, then, becomes, why is adoption so low in North America. For one thing, despite believing we are technologically superior to the rest of the world — and in many cases, the U.S., in fact, is — but when it comes to communications technology, the market often lags Europe and Asia.

 

Take the mobile market, for instance. The U.S. has for years been behind the pace set by other regions when it comes to real-world adoption of mobile applications. The same appears to be true for IPTV.

 

The other mitigating factor is that there is likely a lack of understanding of IPTV, and a misconception that they have to watch IPTV programming on their PCs. Also, there is likely a perception as to available programming via IPTV services.

 

Finally, there is simply the case of a two-year time period for a completely new type of access to video programming still placing IPTV in the early adopter phase. This back to how long it took cable, and then satellite TV to truly take off. Now the same holds true for IPTV. Unfortunately for providers like SES Americom, this economy is not one that can withstand high operating expenses — it has not only its ground operations, but also its AMC-9 satellite to consider.

 

Thus, for the time being, it has made the most rational decision, give then circumstances, and is shutting down the service. What is to come of the operation remains to be seen. Perhaps it can find partners, or a willing buyer for the service, which can then be bundled with additional services to create more appealing alternatives for potential subscribers. In fact, that may have, in hindsight, been its best possibility for success in the first place. SES Americom is first a satellite provider, and looked to leverage that capability to provide a video service.

 

In today’s market, subscribers need more than just a new type of service to drive adoption — which is why bundles offerings are benefitting multi-service providers, which are seeing much more widespread success.

 

Until other arrangements can be found — if they indeed can — current subscribers will have until July 31, 2009 to migrate to alternative video providers.