180SQUARED Targets Incumbent IPTV Middleware Platforms with Cloud-based Replacement

| Nov 4, 2009 | Digital Media Infrastructure | Competitive Intelligence Report

| Analyst: Yoav Schreiber

Current Perspective: Positive
Vendor Importance: Very High
Market Impact: Very High

Event Summary

November 3, 2009 – 180SQUARED unveiled its v.Unison solution set, which enables an IPTV middleware platform to be shared among multiple entities, providing a secure and autonomous environment for each back-end system and customized IPTV offering. Three MBO Video LLC affiliates, Cimarron Telephone, Cim-Tel Cable, and Pottawatomie Telephone, have integrated 180SQUARED’s v.Unison solution set into their network and back-end systems as part of the MBOi (Interactive) video solution, branded Cirrus Managed Cloud Solutions.

Analytical Summary

• Current Perspective: Positive on 180SQUARED unveiling its v.Unison solution set, which enables IPTV middleware platforms to be shared among multiple entities, because it provides the company with a differentiated offering to participate in the IPTV middleware migration opportunity. The v.Unison solution extends 180SQUARED’s proposition for reducing IPTV middleware integration cost, complexity, and time-to-deployment, by improving the IPTV business case with an opportunity for service providers to gain economies of scale and new revenue streams by sharing their IPTV middleware infrastructure as a wholesale service to other service providers and entering new verticals, such as the hospitality market. However, 180SQUARED must still demonstrate why its v.Unison is a compelling improvement to the IPTV business case, given that the major cost levers are the video headend infrastructure, quality video transport, and consumer premises equipment costs – none of which are affected by 180SQUARED’s proposition.

• Vendor Importance: Very high to 180SQUARED, because the v.Unison solution set provides it with a differentiated offering to announce a world’s first in terms of enabling an IPTV middleware managed cloud service. The announcement is also well timed ahead of the Telco TV conference in North America, and it includes an initial customer reference and third-party endorsement, further validating the v.Unison proposition. 180SQUARED’s v.Unison solution also enables the company to up-sell its existing v.Allegro solution (which was re-branded from Mediaroom-in-a-box), combining its cost-reducing middleware integration capabilities with potential revenue-enhancing middleware wholesaling opportunities.

• Market Impact: Very high on the digital media infrastructure (DMI) market, especially within North America, where early IPTV adopters are facing decisions on upgrading/replacing their legacy middleware deployments. Minerva and Nokia Siemens Networks’ Myrio-based installations are impacted most directly, as 180SQUARED can potentially offer a low-cost migration opportunity, which includes an improved business case proposition, not to mention access to Microsoft’s proven Mediaroom platform. Avail-TVN, EchoStar, and Net Insight, which address the video headend and transport managed IPTV service opportunity, also need to ensure that 180SQUARED does not encroach on their market positioning. Finally, IPTV solution vendors, such as Alcatel-Lucent, Cisco, Ericsson, and Motorola, all have skin in the game and may find 180SQUARED eating some of their lunch before they even approach the table!

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

| Client access - Full report in Digital Media Infrastructure | More information

Recommended Competitor Actions

• Managed IPTV service providers, such as Avail-TVN, EchoStar’s ViP-TV services, and Net Insight, can point out that they are focusing on the larger cost and complexity levers for delivering an IPTV service. For instance, the cost of IPTV headend deployment and management can range from $500,000 to over $2 million over five years (according to Net Insight). Thus, by sharing the deployment of IPTV headends in a virtual architecture, or by managing the aggregation and transport of IPTV content, these companies can emphasize their value proposition to enable service providers to cost-effectively enter the IPTV market or migrate from legacy infrastructure to their managed service offerings.

• Legacy IPTV middleware vendors, such as Minerva and Nokia Siemens Networks (NSN), need to defend their incumbency from Mediaroom’s entrance, which 180SQUARED is facilitating. In addition, they can also protect their own consulting and systems integration revenue streams by leveraging the open interfaces within their own platforms to reduce the cost and complexity for back-end integration. For instance, NSN can highlight its focus on consulting and systems integration as an accelerant to revitalize its Home Entertainment (nee Myrio) platform.

• IPTV solution vendors such as Alcatel-Lucent, Cisco, Ericsson, and Motorola need to calibrate their need to focus on their core market tiers and their desire to take advantage of opportunities such as the broadband stimulus in the U.S. While all four of the above vendors possess their own IPTV middleware platform, Motorola’s acquired Next Level platform is the only one with an established footprint (albeit disappearing) to date. Although 180SQUARED is not a direct competitive threat, its v.Unison and v.Allegro proposition effectively siphons systems integration revenues, which begs the question of whether to partner or acquire the company outright.

Recommended End User / Customer Actions

• Legacy IPTV middleware customers with Minerva and NSN platform deployments should evaluate 180SQUARED’s proposition that it can improve the business case for their IPTV service. Specifically, they should decide whether they want to migrate their infrastructure to support Microsoft Mediaroom, and whether v.Unison will improve the overall prospects of that migration’s cost-effectiveness and eventual market success.

• Legacy IPTV middleware customers should also compare the cost-based propositions of managed IPTV service offerings vs. the option of continuing to manage their own IPTV infrastructure, especially if they are considering a migration from MPEG-2 to MPEG-4, which will likely require upgrading deployed STBs.

• Mediaroom customers and 180SQUARED customers that have implemented the v.Allegro solution set should consider the potential revenue streams enabled by wholesaling their middleware platform to additional service providers or offering white-label IPTV services to new markets, such as hospitality.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

| Client access - Full report in Digital Media Infrastructure | More information

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