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OTT

Internet Video: Problem Unsolved

Internet video consumption is growing rapidly, with exponential growth still to come for the foreseeable future. A Heavy Reading study conducted in late 2009 found that nearly 40 percent of U.S. consumer respondents watched more Internet video in 2009 than in the previous year. The surge has only begun – and it threatens to have huge repercussions for network operators.

Internet video (a.k.a. OTT video) goes "over-the-top" of service provider networks, in that operators have no control over offerings, usage, or resultant revenue. While they don't have control over video traffic, operators do have to deal with the massive impact that video traffic volumes create. And from the looks of things, operators aren't going to have much help in figuring out how to tame this beast.

The latest Heavy Reading report, "OTT Video: Service Providers Face a Gathering Storm," explores and analyzes the challenges that Internet video poses for network operators, and examines potential solutions for coping with OTT video's runaway growth. Video is moving ahead of peer-to-peer (P2P) as the primary challenge for service providers. Unlike P2P, video is a real-time application, which means that any traffic shaping or application control measures will result in quality of experience (QoE) deterioration for the end-user.

Broadband providers face a competitive market in most parts of the world, which means that the first provider to introduce aggressive measures to deal with OTT video will likely lose subscribers. Also, regulators are keen to protect innovation on the Internet and defend "net neutrality," though the term itself means different things to different people now. In the U.S. particularly, regulatory uncertainty does seem to be affecting service providers' actions and slowing down exploration of new services and models.

A closer examination of traffic data shows that problems occur mostly during peak times, which approximately span the time between 6:00 p.m. to midnight, with the majority of traffic generated by a minority of users. This split can be quite extreme: One provider found that 1 percent of its users are responsible for 95 percent of peak time bandwidth. Thus, developing mechanisms to control a relatively small proportion of users during those peak periods could resolve many of the problems created by OTT video. Solutions include a set of technologies including Deep Packet Inspection (DPI) and policy tools, edge caching of video, and flexible charging and billing mechanisms that influence usage.

Service providers can also employ a "boost button" approach, where end users pay a small premium for the ability to increase connection speeds for a set amount of time. This allows users to download a high-quality movie very quickly, or boost bandwidth for online gaming.

Service providers may also have the opportunity to use the network to target and personalize services, offer guaranteed quality-of-service capabilities to video distribution partners, and deliver targeted advertising. If they can work with content owners and online distributors to develop such revenue-sharing models, service providers could continue to expand network bandwidth with the resulting revenue.

However, it does not seem that content owners or online distributors are really looking at these approaches today. For the moment, they are focused on expanding their audience and offering high-quality video. Unless end-user QoE deteriorates significantly, they are not likely to change their position. And, of course, deterioration in QoE might drive users to another provider.

Most importantly, though, it would appear that this is the service providers' problem – and they need to find a solution themselves, rather than hope for other members of the value chain to work with them on potential solutions.

— Aditya Kishore, Senior Analyst, Heavy Reading


For more information about Heavy Reading's "OTT Video: Service Providers Face a Gathering Storm," or to request a free executive summary of this report, please contact:




ryanbusing 12/5/2012 | 4:41:17 PM
re: Internet Video: Problem Unsolved

Telco's should embrace the concept of OTT Video and work with solution providers to bring OTT Video directly to their consumers on any screen they want (TV, Web, Mobile) thru a single consolidated login and bill. This will enable them to offer QoS for OTT content, meet customer demand, and leverage existing assests to gain more revenue.

dagant 12/5/2012 | 4:41:01 PM
re: Internet Video: Problem Unsolved

While it is true that video is a real-time application and requires special treatment, optimizing the video actually boosts quality of experience by minimizing the video time to start and reducing the number of stalls or freezes experienced by viewers. For more info on video optimization you can refer to:


http://www.flashnetworks.com/Content.aspx?Page=video_optimization


 

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