This option has a few advantages.
-allows more devices to use the service.
-allows editing abilities with individual channels or groups of channels, which include sorting, channel numbering, channel Groups, multiple Playlists with each arranged or sorted to your liking.
For example, you could have one Playlist with Children's movies only. That way you would have a Playlist with no adult channels to be found, weather accidentally or otherwise).
You could have one Playlist with only VOD movies.
These editing abilities are many. Group Headings for another example. In one Playlist, you can have Group Headings of any choice you want. Horror, Mystery, Sci-Fi, Adventure and etc.. Even a Group labeled as 'AeonFlux' or 'Clint Eastwood'.
Possibilities for Group sorting are endless, along with other editing abilities.
It's not really complicated, but it is alot of work in the editing department, but all the abilities are there.
An individual m3u Playlist can include 1 channel or 5000+ channels.
There are templates posted to help with getting a start with the sorting, which saves lots of time, as apposed to doing the initial sorting yourself.
You can add channels from different sources to your same Playlist too. For instance, if I find online somewhere, an old Classic movie m3u channel, like that old black and white 1921 silent film Nosferatu, I can add that channel line to my Rocket Playlist or any Playlist and it will work as long as the source is good. That's just an example of what can be done with m3u channels and Playlist files.
Playlists are actually the simplest and perhaps the oldest or one of the oldest forms of iptv
An m3u Playlist is really only a list of webs address', with each channel having it's own address. An m3u Playlist is a .txt document which has been encoded correctly as an .m3u file. Editing can be done with most Text Editors.
The .m3u or .m3u8 file extensions are basically just a .txt file encoded as UTF8
An m3u Player reads this .m3u Playlist and finds the web address' as per what ever channel you may turn to and then streams the channel via the Player.
A Playlist can be used directly from a USB drive or can be used thru the Playlist URL
There are individual advantages with each method.
Is it more secure ?
No, but what iptv method is ?