Orange has postponed the commercial launch of its UK fixed-line broadband television service until next year.
The company, owned by France Telecom, was due to offer the service, a rival to Sky, Virgin Media and BT's Vision, before Christmas.
However, analysts said the company's broadband network is not yet developed enough for a full roll-out.
Orange, which has a successful TV service in France, revealed that is has been trialling the service with 350 customers in London and Leeds.
It allows customers to watch video on demand content through their Orange Broadband connection on their home TV.
So far Orange has only announced MGM and Disney-ABC International as content partners. It said more will be revealed early next year.
Analysts are sceptical about the potential profitability of internet television (IPTV) but say it is a crucial way to stop customers defecting to broadband rivals that offer TV services.
Despite a strong last quarter, Orange has been lagging its rivals in terms of broadband subscriber additions, said Ian Maude of Enders Analysis.
''It's important for them to protect the broadband base from other service providers particularly Sky [which has more than 1m broadband subscribers]," he said.
''They are not going to make any money out of IPTV - we estimate for example that Virgin Media makes around £2 to £3 a month per video-on-demand subscriber.
''But Orange needs to offer it because everyone else is and to prevent broadband and telephony customers leaking to the competition."
Meanwhile, its rivals are pushing on. BT last week surpassed its target of 100,000 Vision subscribers - its aim is 3m within Three years.
An Ofcom report this week showed that an average family household could save 34pc by bundling their fixed-line, broadband and pay-TV subscriptions and taking out a separate mobile subscription.
Orange's service is expected to be a hybrid of Freeview channels offered over the air and on-demand content down the phone line, similar to BT Vision.
Tim Pearson, director of digital TV for Orange, said: "A nationwide roll-out of home digital TV demands an excellent viewer experience. The feedback from customers watching digital TV from Orange in London and Leeds will be essential as we roll out across the UK next year."
To offer the service Orange needs to install broadband equipment in BT's exchanges. By September it had covered only 40pc of the population whereas rivals have coverage of around 60pc, said Enders.
Joined: 23 Dec 2007Posts: 43Location: Deptford, London
I checked out Orange france's website and found their tv service very interesting. Their services/packages/number of channels can compete with canalsat (the equivalent of Sky) very well.
Big question is whether Orange uk can follow those paces or not. Hopefully, they will at least prioritise the work to be done on broadband speed issue then work on the channels and packages.
If Orange could offer choices of channels similar to Sky but at more competitive price I would definitely be one of the first customers. Having said that, i'm currently still not quite pleased with their broadband speed though
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