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Inside the IBC

An estimated 40,000 broadcasters descended on Amsterdam last week for
the International Broadcasting Convention (IBC), the European version of the
NAB show. At the RAI Convention Center, a big steel building that clashes with
the city's famed canals and ancient architecture, they discussed the future of
European TV.

The big advantage of IBC, says Sony Broadcast Director of Marketing Alec
Shapiro, is the chance to get a "hands-on demo of a product." Broadcasters can
see how products introduced at NAB would fit into their stations and affect
various products and systems. But unlike other trade shows, Amsterdam's
café culture permeates the floor. The relaxed atmosphere encourages
discussion. It's not uncommon to see vendors offer beer at 5 p.m.—along with
state-of-the-art technology.

One example is Sony's HDV format, a new high-def version of the DV
format that has overtaken large parts of the professional (but not broadcast)
marketplace. It was shown at NAB as a non-working prototype. In Amsterdam, it
was fully operational.

"It's the next logical progression of DV," says Shapiro, "and it's
designed to work with the DVCAM infrastructure." The cost-effective format has
some compromises in resolution (only 1440x1080 instead of 1920x1080 pixels),
but price points around $5,000 could spur huge interest when it's rolled out
early next year.

Of special note among the impressive offerings at IBC: HDTV, the use of
advanced video codecs, and how telco-delivered video services will change the
competitive landscape. Also in the spotlight: mobile video services and
technologies, such as the DVB-H.

The European digital television transmission standard is known as DVB-T;
its mobile application is called DVB-H (the H stands for handheld devices).
Most important, it can be used in the U.S.; a trial in Pittsburgh is about to
get under way.

Better mobile delivery

According to Dr. Martin Richartz, information director for Contcast, a
German company, the mobile system requires about 3.5 Mbps of spectrum and
slices that spectrum into 354-kpbs sections. The sections are then transmitted
to cellphones, PDAs or other wireless video devices using Internet Protocol
(IP) packetization. "We have some encouraging results in terms of how well the
technology works," he says.

One exciting aspect of DVB-H is that it allows two-way transmission. In
the Berlin tests, users can watch a program with video clips and vote from
their device for the next clip. Richartz says the DVB, the organization that
sets European broadcast standards, is expected to pick one encoding method for
the MPEG4 H.263-based technology.

The H.263 standard's bigger brother, MPEG4 H.264, also made news on the
IBC show floor.

H.264 and Microsoft's Windows Media 9 (recently renamed VC1) video and
audio formats promise tremendous bandwidth efficiencies compared with MPEG2.
Manufacturers displaying products based on the two formats (collectively known
as Advanced Video Codecs, or AVCs), showed improvements in the quality of the
video AVCs deliver.

"We're still in the early life of AVC," says Yaron Simlar, president of
Harmonic Convergent Systems. Still, Harmonic has already found a UK company
that hopes to use the technology to deliver video over DSL. "By the end of the
year, we should know if AVC will be ready for full commercial deployment," he

AVC explosion

In the U.S., however, the use of AVCs will be difficult for cable and
satellite. Existing MPEG2 set-top boxes, which number in the tens of millions,
would have to be swapped out for boxes that decode AVC. But it clicks with
USDTV or DSL, which don't have to replace set-top boxes.

Europe is ready to explode with AVC delivery via DSL. Since 2001, the
cable industry there has had tough times, leaving it vulnerable to telco
operators. Video-over-DSL services are taking off with MPEG2, but AVC will
allow more services to be delivered without compromising quality. Using AVC, a
digital standard-definition channel can be delivered in about 2 Mbps; a
high-definition signal, in about 7 Mbps.

"We know that VC1 and MPEG4 H.263 will be a migration point simply
because of the cost points," says Tandberg Director of Technology Matthew
Goldman. Distributors have more flexibility in bit rates, since both
transponder and delivery costs shrink as bandwidth shrinks. Tandberg's latest
intro is the HD Intelligent Compression Engine, found in the EN5980 Windows
Media 9 series 9 HD encoder and the EN5990 MPEG4 AVC HD encoder. Software is
the differentiation between the two units.

"It's about faster, better, cheaper content for less money," says Bob
Wilson, CEO of Modulus Video, a company that currently makes only H.264
encoders and decoders. He says VC1 could be in his company's future if
customers demand. For now, the focus is on H.264.

And that may be a good bet.

Format Choice

The ATSC (Advanced Television Systems Committee) recently made available
to members a report comparing the two formats. One manufacturer executive who
saw it says, in every instance, H.264 was either equal to or better than
VC1—sometimes by 10%. The report is rumored to have Microsoft executives
concerned. They have changed their position: For the past two years,
Microsoft's strategy has been to show how VC1 was superior to H.264. This year,
Microsoft executives publicly stated that there is a place for both.

For now, H.264 is winning the AVC battle. But the point may be moot. HD
set-top boxes in Europe are believed to have both VC1 and H.264 decoding
capability. The goal is to make sure the distribution landscape is as open as

Wilson says AVC will likely play a big role at cable and satellite
operators and telcos by next year. It's also expected AVC will be an enabling
technology, finally bringing HDTV services to Europe. MPEG4 can ride the rails
of the MPEG2 transport stream so that one over-the-air signal can deliver
disparate services. Viewers that don't have next-generation MPEG4 receivers can
watch MPEG2 services. Those with the MPEG4 boxes can receive additional SD and
HD channels.

Why do European broadcasters need AVC? Markets are typically covered by
four or five channels. The move from analog to digital terrestrial signals
provides more SD channels, as many as four in each analog slot. Without AVC,
one HD channel would require as much bandwidth as four SD channels. With AVC,
one HD channel can replace one SD channel in the Digital Terrestrial
Transmission (DTT) signal.

Other countries rolling out DTT include Finland, Sweden, Spain, the
Netherlands and Germany. In 2005, France, Italy and Hungary will begin. For
countries like Germany, which has cable and satellite penetration around 85%,
the transition will be quick. Once the DTT transmitter is live, the analog
service has to be shut down within a year. (Those without cable will have to
purchase set-top converters). The UK, however, doesn't expect to turn off
analog until 2012, four years after Germany.

HD in Europe

The bottom line: AVC means the difference between delivering HD and not
delivering HD. Since there are no legacy HD sets or vast quantities of set-top
boxes to be replaced, AVC is a logical choice.

One of the biggest HD events at the show was a BBC demonstration of a
satellite-delivered HD service. Peter Wietzel, director of technology for BBC
Technology, doesn't expect Europe to roll out HD on a large scale before 2010.
Like other European broadcasters, the BBC will begin looking at HD sooner.

"We're already acquiring in HD, and we can't imagine anyone asking for
new non-HD facilities," says Wietzel. The BBC has moved to widescreen (the
ratio is 14:9; the U.S. standard is 16:9), so when the HD change comes, the
directors will be ready.

But when remains a mystery.

Traditionally, the BBC likes to roll out services to all of its
platforms: cable, DTT and satellite. But the difficulties HD may place on DTT
and cable might make it a satellite-only offering. And while there is no
deadline to offer HD, there is one market force: the 2006 FIFA World Cup in
Germany. The soccer matches will be shot in HDTV. With BSkyB slated to begin HD
soccer broadcasts in August 2005, the BBC might feel pressure for HD

Overall, whether the choice was HDV, AVC, DTT or HDTV, all rely on
compression technology to gain bandwidth efficiency. Says Ajay Chopra, Pinnacle
Systems president, broadcast division. "You get a certain level of improvement,
and then you hit the wall."

That wall, as evidenced at IBC, continues to inch forward. n