The Best of Times & Worst of Times in the Video Business Mark Donnigan Vice President Marketing at Beamr
Read the original LinkedIn article here: The Best of Times & Worst of Times in the Video Business
Mark Donnigan is VP Marketing for Beamr, a high-performance video encoding technology company.
Best of Times & Worst of Times in the Video Business Mark Donnigan Vice President Marketing at Beamr
Can a four character technology save us?
This is an interesting concern due to the fact that there is a paradox emerging in the video organisation where it seems like the the best of times for many, however the worst of times for some.
Here we have Disney revealing that they have currently accrued one billion dollars in loses, and this even before releasing their direct to consumer business. And after that we have Verizon Media announcing sweeping layoffs which represent an exit from a few of the core entertainment service and innovation services that were operating under the Oath umbrella.
And naturally there isn't a reporting interval that passes where the cord cutting numbers have not grown, which puts increasing pressure on the video side of the provider organisation.
Netflix stock is on the increase once again, enabling the business to invest in material at levels that should mystify their rivals. And after that we have news of PlutoTV selling for a mouth watering $340 million dollars in money to Viacom (deal was revealed on January 22, 2019), showing that the AVOD company design can be viable and quite important.
5G is going to conserve us all?
This is where I wish to connect with the huge financial investments being made in 5G and provide my point of view on why 5G might well break some video business while at the very same time make others.
Let's look at AT&T.
In the last 4 years AT&T has actually included 80 billion dollars of extra financial obligation leaving it with more than 160 billion dollars of brief and long term debt. Now, 50 billion of this staggering number was the result of the 2015 purchase of DirecTV.
My point is not to break down the AT&T debt numbers, I'm not an expert, but rather supply a point of view that the monetary circumstance for AT&T entering into its enormous 5G financial investment cycle, while at the exact same time making known their tactical effort to develop their video service capability through Warner Media direct to consumer offerings like HBO, and DirecTV, is going to be challenged, unless they do something very different with video.
What can a service provider like AT&T do to deal with the economic capture, and the overall headwinds to the video business? Such as declining pay TELEVISION subs, and fragmenting OTT service offerings. This is the concern on many minds who are analyzing the future of the video organisation.
It is my strong belief that common high speed mobile networks powered by 5G will unleash a video tsunami of traffic on the network like we've never seen before.
This will be excellent news for the PlutoTV's of the world and other innovative video services like Quibi who will be able to reach more customers with a better quality experience as an outcome of being able to take advantage of a quicker network thanks to 5G.
But, it's bad news for network operators without a strategy to monetize this extra traffic load, and obviously incumbents who are hoping to manage with incremental improvements to their services; such as changing from managed to unmanaged, or OTT circulation, while continuing to use aging video requirements like H. 264 to deliver low resolution mobile profiles.
Video distributors who continue to under serve their clients will quickly be at a drawback, and ripe for interruption, I believe, from brand-new organisation designs such as AVOD and the most recent and most efficient video technologies.
The 4 character video technology that might conserve the video company.
The 4 character video standard that I believe will play a key function in the success of the video organisation is HEVC, the video codec that is now deployed on two billion devices. The following slide presentation offers numbers concerning HEVC gadget penetration which are worth seeing.
There has actually been much discussed HEVC royalty concerns, something that triggered development of an alternative codec which probably is royalty complimentary. Nevertheless, while some in the industry ended up being preoccupied with concerns around licensing and royalties, significant advancements have been made on the legal front, including almost every CE gadget maker including HEVC playback support.
For example, HEVC Advance waived all royalties for digital circulation of content. This suggests, HEVC encoded content that is streamed will just carry a royalty for the hardware decoder and this is currently covered by the receiving gadget. Offered that you are providing bits over the wire and not through a physical mechanism such as Blu-ray Disc, your business will not have to pay any additional royalties, a minimum of not to HEVC Advance.
Now, if it's any comfort, the companies who have currently done their due diligence on the royalty question, and are streaming HEVC material to consumers today, consist of: Amazon, Comcast, DirecTV, Dish Network, Netflix, Sky, Sony, Vudu, Vodafone, and Orange, simply among others.
What about HEVC playback assistance?
This is an extremely excellent and essential concern and perhaps the location of advancement around the HEVC community that is least recognized or understood.
Beginning with at home playback, if your users have bought Get More Info a TELEVISION, game console, Roku box or Apple TV in the last 3 years, you can be almost guaranteed that support for HEVC exists without any need for extra licensing or player upgrade.
HEVC is now resident in nearly every SoC that goes in to any mid to high-end CE video device. Considering that 2015, market reports show this group of products numbers 400 million. That's 400 million devices that support HEVC natively. It's a great start, but what about mobile?
The information company ScientiaMobile maintains the largest dataset of network device gain access to profiles by getting information from the biggest cordless operators in the world. This company reports that a massive 78% of all iOS mobile phone demands originate from gadgets that support hardware-accelerated HEVC decoding. And though iOS gadgets are predominant in the majority of developed markets, Android is still an exceptionally crucial device profile, and here the ScientiaMobile information is really encouraging with 57% of Android mobile phone demands originating from gadgets that support HEVC decoding.
And offered the HEVC gadget penetration and hardware support any worries about an early relocation to HEVC are not necessitated. What other elements verify the idea that HEVC will be a booster to the video business?
LiveU just recently released a report called 'State of Live' that showed growing trends in HEVC broadcasting, specifically on the planet of sports. And just in case you have ideas that using HEVC is a passing trend en route to some alternative codec, think about that in 2018, 25% of all LiveU produced traffic was streamed using the HEVC video requirement while the only other codec used was H. 264.
The report specified that the high HEVC usage was a direct reflection on the increasing need for professional-grade video quality, a trend that was plainly apparent at the 2018 FIFA World Cup in Russia.
What does this mean for the market?
The trends we simply examined expose that we have an ever more requiring customer who wants content that flaunts the complete capabilities of their seeing device, which means greater resolutions and advanced video requirements like HDR. But, this same user is now taking in more material, which contributes to more congesting the network.
This customer intake pattern is colliding with a shift from handled services to unmanaged, or OTT distribution and developing technical tension inside incumbent service operators who are facing technical shifts and organisation model fracturing. Amazingly, in spite of an extremely clear hazard to the incumbent services who are seeing video subscriber loses installing into the numerous thousands over just a couple of brief quarters, some are continuing with the status quo even while brand-new entrants are releasing services that give the consumer more for less.
This is where completion of the story will be composed for some as the very best of times, and for others as the worst of times.
HEVC is more than a technology enabler. It's a video standard that is set to interrupt much of the conventional operators and early OTT streaming services. Not due to the fact that the consumer understands the difference between H. 264, VP9, or even HEVC, but due to the fact that the consumer is realising that better quality is possible, and as they do, they will migrate to the service who provides the finest quality cost effectively.
At Beamr, our company believe that the proof of our product and technology excellence must be skilled and not just discussed. Which is why we have actually assembled the finest deal that we have actually seen in the market where you can utilize our codecs in combination with our VOD transcoder, 100% totally free.
HEVC is now resident in nearly every SoC that goes in to any mid to high-end CE video device. These 2 numbers are where the photo of HEVC as the most sensible video requirement to follow H. 264, begins to take shape. Here we have significant video distributors and tech companies already encoding and dispersing material in HEVC. And given the HEVC gadget penetration and hardware support any worries about an early move to HEVC are not called for. What other aspects validate the idea that HEVC will be a booster to the video business?
You can experiment with Beamr's software application video encoders today and get up to 100 hours of totally free HEVC and H. 264 video transcoding each month. CLICK HERE
Written by: Mark Donnigan