LAS VEGAS--The National Rural Telecommunications is set to launch an IPTV product at the beginning of next year, through a partnership with the National Telecommunications Cooperative Association and SES Americom.

Speaking at the opening of the iHollywood Forum this morning in Las Vegas, Mark Ellison, senior vice president of legal and business affairs for NRTC, said the non-profit group, which has customer relationships with about 500 rural telcos, would offer the still-yet-unnamed product to cut down on the cost of getting into the business. SES Americom already has branded its version of the service as IP Prime.

Under the plan, which will be officially unveiled at the TelcoTV show in November, SES will take in programming from a variety of sources to its New Jersey facility, encode it in IP, compress it using MPEG4 and transmit it via satellite to NRTC and NTCA members. Local telcos will receive the signal via a satellite dish and be able to send it out over their existing DSL infrastructure.

“It takes that $3 million to $5 million head end and makes it about a $250,000 headend,” Ellison said.

SES also will be procuring the IP set-top boxes. Initially, those will be from Scientific Atlanta.

“With that buying power, they’ll pass it though at cost to us and we’re a non-profit, so we’ll pass it on to our customers at cost,” Ellison said.

The solution marks a significant competitive shift in the market. Previously, such packages of content and head end equipment only were being delivered by groups of vendors such as Eagle Broadband and Globecast.

Ellison said the NRTC consortium will be operational by December and begin beta testing with three telcos in the first quarter of 2006. The commercial rollout will happen in the second quarter of next year.