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Boxee CEO: Why TV Everywhere Won't Win

4/26/2011
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12/5/2012 | 5:06:33 PM
re: Boxee CEO: Why TV Everywhere Won't Win


Avner is a smart cookie, but his reasoning on these points seems flawed. The bigger issue with OTT video for network operators is the fact that it is consuming a disproportional amount of bandwidth that is unaccounted for. As a result OTT video is eating into capacity for other Internet traffic. This represents a hidden cost in loss of opportunity, that has not been brought in the picture so far. Each Netflix stream uses the same amount of bandwidth of perhaps one hundred Skype sessions, or 10K eBay transactions.


Fact is that the value per bit of video is very low, but every bit has the same cost and can only be used once. That in itself is a net neutrality issue, albeit at Internet scale. That issue can not be fixed in a best effort model because any bandwidth you'd throw in is more likely going to be gobbled up by OTT video, than that it's benefit other applications. Adaptive streaming protocols are compounding the issue, because it'll simply turn up the resolution and consumer even more badnwidth, the moment it is made available.


Anyway, I haven't heard why TVE is not winning. It certainly does address a new set of user requirements and it seems premature to call winners and losers when only recently we are seeing TVE being launched at any scale. Also it's unclear why a network provider would want to go OTT, other than in offering a place-shifting service to his direct subscribers. They'd run in a ton of content distribution right issues and be competing directly with the likes of Hulu and Netflix. An OTT video delivery strategy has a far lower chance to succeed than on on-net TVE strategy.

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