With the development of broadband television using internet protocols, the boundaries of interactive television begin to blur to include applications such as video telephony.

At the CeBIT show in Hannover, Swedish company i3 is demonstrating a residential video telephone system based on a set-top box that combines voice and video over IP technology.

Current video telephony solutions are not tailored to the consumer market. Either they are designed for big business, and priced accordingly, or they lack the performance and ease of use that can attract a broad consumer market.

The i3 system has been developed in partnership with video telephony provider VCON and Orca Interactive, which is apparently the first IPTV middleware company to integrate video telephony.

“We are proud to work with i3 and VCON to combine this new video telephony application with Orca’s IPTV offering that includes broadcast television, video on demand and personal video recorder,” said Haggai Barel, chief executive of Orca Interactive.

The combination of i3’s Mood 300 IP set-top box with VCON’s ZAPI 4 TV development environment and Orca’s RiGHTv IP TV middleware is aimed at operators and service providers looking to expand their offerings beyond basic IP telephony and IP television services.