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UK ISPs who resell will bleed money to death

UK ISPs who resell will bleed money to death
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Bosses at BBC might be congratulating each other over the success of the iPlayer but ISPs are more nervous and worried about the effect that watching TV shows online will have on their already battered networks.

Andrew 'The Oracle' Orlowski reports on a news bulletin released by Telco 2.0 and which looks at the streaming sector from the content provider perspective and from an ISP point of view.

BT-owned Plusnet provided with an initial analysis of the impact that the iPlayer had on its services, something that Telco2 reckons, will send shivers down the spine of a few ISPs.

Plusnet found out that more people are watching high quality television shows online for longer periods, a stark contrast with the model advocated by Youtube - short, low quality content.

Plusnet found out that the cost of streaming increased from £17,200 to £51,700 per month, which represents a trebling of the cost per user - which goes to 18.3p - and that's for the first month only.

Telco 2.0 writes that "the BBC paid just £99.7m for distributing its broadcast TV signal last year, £42.6m for its radio signal, and only £8.8m for its online content. This is out of a total of £3.2bn licence fee income."

The Register calculates that the cost per minute per user is roughly a penny - 60MB of data - which the customer is paying by way of a fixed fee to the internet service provider, regardless of how much you view.
Desire Athow

Posted by Desire Athow on 21 Feb. 2008

Désiré Athow is the Content Editor for ITProportal.com and has been writing tech articles for nearly a decade. You can follow him on Twitter.

Tags: Broadband, IPTV, Web 2.0