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Delivering video quality at scale
Experts at Cisco share their thoughts on how to exceed broadcast and OTT with video quality at scale.
Do you remember the good old days? Content ruled, and video service providers were happy to make their living from delivering a decent service of premium linear and live content to TVs. The service was reliable, distribution costs were relatively low, and security was simple. All the ingredients were there to attract a growing subscriber base and generate revenue along the way through the dominant subscription and advertising business models. Then along came over-the-top( OTT) video. The likes of Netflix entering the playing field changed everything. Slowly but surely, video consumption has been shifting from traditional broadcast delivery to the TV set toward IP delivery to mobile devices. In fact, according to multiple industry surveys, millennials – a primary demographic for video growth – view 70 % of their video content online. What’ s more, the Cisco Visual Networking Index predicts that by 2020, 82 % of IP traffic will be video.
Time to bring on the cavalry
Adding more HD, even 4K, channels to the
By 2020, 82 % of IP traffic will be video
video service provider’ s package should surely do the trick and stem the tide of popularity in favour of OTT. But alas, no. None of those options, or other developments we’ ve seen since, for example, slimmer bundles, seem to have done much to persuade consumers to love their video service providers any more.
According to a Satmetrix US Consumer Net promoter study conducted in 2015, consumers are more inclined to recommend their OTT service over services offered by cable and telco service providers: a pattern we have all witnessed across the board in any market.
Why is that?
For one thing( actually four), OTT providers can offer more personalised services, they can launch new services more quickly and entice consumers with new, low-priced business models.
Yes, that’ s three. But we’ re saving the best for last. Because the real joker up the OTT sleeve has been about ubiquity. OTT providers offer content across all consumer devices.
On the surface, it would seem that a $ 400 billion global pay-TV market is slowly being eaten away by the world of OTT.
However, that might not be the case.
According to a recent survey from Limelight Networks, almost half of respondents will stop watching an online video stream after the second time it buffers. Or to use baseball parlance, two strikes, and you’ re out.
Although OTT providers can indeed deliver video content to every device, they can’ t do it at scale without forcing the user to experience interruptions to their video stream.
We might be living in generation‘ i’: iPad, iPhone, iPlayer. But‘ I’ also stands for impatient.
So, although being able to watch content on any device is a big deal for consumers, watching without interruption seems to be equally important to them. In fact, for consumers accustomed to uninterrupted video quality on their traditional TV, the expectation has been set at a very high bar.
And that can slowly turn a pleasurable experience into a tortuous one.
Video ubiquity might help to win over consumers. However, only video quality will keep them.
The best of both worlds – and more
So, what are we left with? We have broadcast technology offering high video quality to TVs. However, it hasn’ t extended that to every device.
OTT technology can reach multiple devices. However, while OTT services have made valiant attempts to resolve the issue of video stream interruptions, they cannot do so at scale.
So, it seems that if you want to reach the holy grail of delivering video quality at scale and extending it to all devices, you need to be able to exceed the capabilities of both broadcast and OTT video delivery technology. The ramifications of exceeding both could actually have broader implications.
Today, streaming cost per viewer is relatively low in broadcast, whereas in OTT it is relatively high.
The cost of preventing churn and keeping subscribers loyal is relatively high in both( though arguably lower for OTT).
If service providers were in a position to take the things that are good about broadcast and OTT today and add a little more smart technology, they could create a new paradigm for video delivery that exceeds both. At the same time, it would enable them to grow revenue, reduce churn, and optimise costs.
And it all does indeed come down to video quality. It alone can be the greatest untapped source of competitive differentiation in a saturated and fragmenting marketplace.
To be sure, this isn’ t just about merging technologies. It’ s also about using new technology across the whole delivery chain from headend to client to do what neither broadcast nor OTT delivery has been able to do until now: deliver high-quality video over IP to multiple devices at scale.
Why does it require the entire delivery chain?
The key to influencing video quality requires the ability to make intelligent decisions –
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