Upon reading a BBC article published today, it seems that British Telecom's planned IPTV service is much less attractive than we had hoped. It turns out that the service does not support live TV or digital video recorder (DVR) functionality, but will be entirely on-demand. In other words, 360 owners will have access to BT's programming library, but won't be flipping channels or recording their favorite shows to watch later. Looking through the CES press release again, the only advantage we can see over the standard set-top box service (which offers live TV and DVR) is that gamers can stay connected to Xbox Live while watching on-demand programming through their 360s, allowing them to send messages and receive game invites among other things. We're not sure that alone justifies a 12-month contract. Of course, if you're interested in nabbing a BT set-top box and you just happen to have a 360 as well, it makes some sense.
Perhaps the most interesting quote in the BBC article is from a BT spokesman: "The reason for streaming only on the Xbox is because currently the console does not have the capability for live TV ...." Now, we know the 360 is capable of live TV, as it was demonstrated at last year's CES. Furthermore, all IPTV is streaming, which makes the quote a bit odd. As far as we know, the only thing keeping the 360 from streaming IPTV is a firmware update. For now, we'll give BT the benefit of the doubt and assume that's what the spokesperson was referring to. We've got a call in to Microsoft for clarification.
Update: After a helpful comment and some digging, we've figured out the basis for British Telecom's claim that the 360 couldn't support live TV. It turns out that BT's live TV offerings are all made over the air. In other words, live TV is received via an antenna, something the 360 currently can't do. The on-demand services, on the other hand, are offered through IPTV. Still, as the first official IPTV offering on the 360, it seems a bit lacking. (Thanks for the insight, mike.)
[Thanks, Scotty Turbo]