From a WebLi IPTV watcher's point of view, IPTV is very simple: instead of receiving TV programs as broadcast signals that enter your home from a rooftop antenna, satellite dish, or fiber-optic cable, you get them streamed (downloaded and played almost simultaneously) through your Internet connection. Not the kind of connection you have today, which can probably handle only 1–10 Mbps (million bits per second—roughly the amount of information in an average novel entering your computer every second!), but a broadband line with about 10 times higher bandwidth (information carrying capacity) of maybe 10–100Mbps. You watch the program either on your computer or with a set-top box (a kind of adapter that fits between your Internet connection and your existing television receiver, decoding incoming signals so your TV can display Internet programs).
From the viewpoint of a broadcaster or telephone company, IPTV is somewhat more complex. You need a sophisticated storage system for all the videos you want to make available and a web-style interface that allows people to select the programs they want. Once a viewer has selected a program, you need to be able to encode the video file in a suitable format for streaming, encrypt it (encoding it so only people who've paid can decode and receive it), embed advertisements (especially if the program is free), and stream it across the Internet to anything from one person to (potentially) thousands or millions of people at a time. Furthermore, you have to figure out how to do this to provide a consistently high-quality picture (especially if you're delivering advertising with your programming—because that's what your paying advertisers will certainly expect).
IPTV stands for Internet Protocol TV—but what does "Internet Protocol" mean? It's the essence of how the Internet works.
Send an email to a friend or download a web page and the information you set in motion doesn't travel in one big lump, as you might expect. Instead, it's broken up into lots of small pieces, known as packets, each of which may be "switched" (sent) to its destination by a different route. Packet switching, as this is known, is the basic principle of how any information travels over the Internet. The computers that link the Net together don't know what any given packet means or what it does. All they know is the IP address (a numeric "house and street name" given to every computer on the Internet) where the packet has to go—and they treat all packets equally.