The Long, Steady March of IPTV—Microsoft Set-Top Boxes Now in One Million Homes

msft-mediaroom-logo.pngMicrosoft has been trying to get into the set-top box software business for more than a decade. Its current efforts, known as Mediaroom, are focused on a big push behind IPTV (Internet protocol TV). Despite its name, this is not TV over the Web on your PC. Rather, Microsoft is bringing Internet technologies for delivering video to telephone companies looking to compete with cable.

Today, Microsoft announced that one million Mediaroom-powered set-top boxes are delivering TV around the world through more than 20 service providers. These include AT&T’s U-verse, Duetche Telekom, and Briitish Telecom’s BT Vision, which just announced that later this year it will make its IPTV service available in the UK to anyone with an xBox 360 console, in addition to the conventional set-top boxes it uses today.

Here is a partial breakdown of Microsoft’s biggest IPTV deployments:

  • AT&T U-verse has 126,000 IPTV subscribers in the U.S. (as of October, 2006), with a goal of one million by the end of 2008.
  • BT Vision has 100,000 subscribers (pre-Xbox).
  • Deutsche Telekom passed the 100,0000-subscriber mark in December.

One million TV subscribers spread across the globe is still tiny compared to cable and satellite TV, but it is an important milestone. If it takes Microsoft another year to get to two million subscribers worldwide, the cable and satellite companies won’t have much to worry about. But if the momentum can build and Microsoft can get to 10 million subscribers, it could start to become a real business for Microsoft.

Microsoft is not the only player in IPTV set-top boxes, but it is an important bellwether for this emerging market. Google might want to speed up its efforts in this area before the market really takes off.