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The technology is already starting to take off. According to the report, in the first six months of 2005 the number of subscribers to European IPTV services increased by 66 per cent.

Across Europe, France is currently the biggest of Europe's IP TV markets and looks to stay that way over the coming years. Screen Digest says it will remain the largest market through to 2009 by which time there will be 2.4 million subscribers

The report also warns that IPTV will have a significant effect on existing pay TV services from cable and satellite operators. The authors estimate that IPTV will take around 9.5 per cent of the pay TV marketplace in the next five years. In the UK up to 7.5 per cent of pay-TV users of Sky, NTL, Telewest and other operators will have switched to IPTV.

A number of organisations in the UK are already trialling IPTV services. These include the BBC, which is planning to offer a range of its broadcast TV services over the Internet next year, and BT, which is hoping to offer movies and other content such as sporting events over its broadband services as a new revenue stream.