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This paper studies the conditions under which P2P sharing can increase the capacity of IPTV services over FTTN networks. For a typical FTTN network, our study shows a) P2P sharing is not beneficial when the total traffic in a local video office is low; b) P2P sharing increases the load on FTTN switches and routers in local video offices; c) P2P sharing is the most beneficial when the network bottleneck is experienced in the southbound segment of a local video office (equivalently a northbound segment of an FTTN switch); and d) sharing among all FTTN serving communities is not needed when network congestion problems are solved by using some other technologies such as program pre-caching or replication. Based on the analytical results, design for IPTV services which monitors FTTN network conditions and decides when and how to share videos among peers to maximize the service capacity. Simulations and bounds both validate the potential benefits of the MediaGrid IPTV service platform.