What’s the detail of your relationship with SBC and their Project Lightspeed?

SBC uses Motive primarily for their data services. We are going to be right there with them on the data side of Lightspeed, and we are engaged with them around home network services also. We are also talking to them about their TV services.

Why is any consumer going to say that they want to switch to IPTV when they already have an adequate TV service?

There will be one of two things that make switch – price or content that you are passionate about. Some will compete on price, some won’t. Ultimately, payback on the investment comes with volume. But we are not going to set the world on fire with IPTV in the next year. In the early days of these services you aren’t going to switch on and ultimately have millions of customers. For us as a company it won’t be part of our core revenue for ’06. It’s very much a crawl, walk, run, at the moment.

But it will start moving. Consumers are open to competition, to and open to alternative services. If carriers can get to point they can provide something that will resonate with consumers, they will start to come over. In the short term the telcos will start to see what’s coming over and how they can improve on that customer experience.

There are simple things telcos do to differentiate and to add more compelling content. Time is best spent on acquiring customers, being creative with services and content, and looking to cater to more of a niche audience. They won’t turn around the business in a year, but it will ultimately turn around. And the telcos need to do it. Core revenue is being eaten away as people have many other alternatives in terms of in terms of phone lines. Their cash cow is not there any more, and so it’s necessary to get into the video business.

Aren’t the telcos starting from too far back to now become content providers?

Isn’t the race already lost? That remains to be seen. From my personal perspective I believe that what will be compelling will be the differentiator of the switched network.

What exactly will those differentiators be?

Telcos will have to be very careful what type of relationships they forge with the content providers. I also think that acquiring niche content will be vital. But IPTV providers have an advantage because their bandwidth means that they can deliver an almost infinite number of channels. You’ll be able to go and find the basket weaving channel, the sculpture channel, you name it, it will be out there and there will be an audience for it.