2016: Over the Top for Video Services

2015 was the year that premium OTT video delivery graduated from peripheral to core business. Market leaders released products such as Sling TV from Dish, which delivered without the aid of a set-top box. Verizon added Go90, and; Comcast added Stream TV Smart devices got smarter and more impressive. Apple TV got a well-deserved update; Fire TV became even better; and Roku was embedded in consumer TVs. With these developments we turn to the question of momentum. Is this the start of unprecedented TV experience?

Let’s look at what I predict will happen in 2016:

Broadband Is the “New Black”

Broadband home service is a strong alternative to video and a bright spot for pay TV providers and can create tremendous opportunity for another revenue stream by offering cable-plus broadband services. Broadband home growth driven by OTT gains is helping to offset the higher programming costs and the decline in video revenue caused by cord-cutting. Large and even small operators may likely go back to basics, making broadband more of their future focus. To weather the rapidly transforming nature of traditional media consumption, cable companies appear to be beating the no-pay TV trend by focusing more on Internet services and creating a robust broadband ecosystem to emphasize more of data delivery instead of video while broadening broadband pricing as the demand grows.

Super-Sized and Connected TV Will See Growth

Smart and connected TV video-streaming devices are continuing to lure audiences back into the living room, and with the rise in OTT and streaming, the industry is looking ahead to a new and more immersive reality. Viewers on the go are watching more video on their pocket gadgets, but the average minutes per phone device per month is far less than the average for connected TV devices. Companies will be working for an improved search and discovery functionality for a better user experience and utilizing cloud to make it easier for operators. Ten percent of Americans stream video to a connected TV every day, and we expect streaming media homes will likely overtake pay TV homes in 2016.

Premium Content: a Visual Delight

To improve consumers’ experiences we will see operators increase bitrates range his year. Until now, nothing much has happened at the very top of the pyramid; streams of 5 Mbps or more aren’t growing very rapidly, although we are seeing a shift towards the 2–5 Mbps range. The lower end will continue to be there because video continues to be watched on smaller screens connected to cellular networks, but the same range would be unacceptable on a big screen TV. 

Premium Content Will Have Reliable Delivery

One of the challenges for any business operating on the Internet is management. Moving data of any kind, especially video, from the point of origin to the point of consumption is an intricate and tricky business. Some services try to go at it alone; others contract with content delivery networks (CDNs) to get the job done, which results in a markedly superior viewing experience. 2016 will be the year that premium streaming video providers phase out legacy in-house delivery networks and commit to CDNs. 

Conclusion or the Start of 2016

OTT is rapidly gaining acceptance and is a fait accompli by broadcasters and pay TV operators. If 2015 was the year that OTT stepped into the spotlight, 2016 will be the year of its maturation. Much of what is being forecasted for 2016 are trends that started to develop in 2015. Skinny bundle offerings, which were new last year, will be judged for the service they provide rather than their uniqueness. And as audiences are not driven by appointment viewing and won’t accept subpar viewing experiences anymore, they will be drawn to providers that can provide quality content. Companies will remain strategically focused on the best possible combination of factors where audiences, data, content and technology meet to deliver a good or even exceptional viewing experience.

Contact sales@acgcc.com for more information about our video services.

Meghna Zutshi
mzutshi@acgcc.com
www.acgcc.com

Happy Holidays from the Staff at ACG!

SDN/NFV: Intelligent Transport Networking

Tim Doiron, principal analyst, Intelligent Transport Networking, ACG Research, leads an SDN/NFV panel at Layer123 SDN & OpenFlow World Congress in Dusseldorf, Germany.  Tim introduced the panel participants and shared some of the recent findings of ACG Research as part of the panel kickoff.  In working closely with a number of customers, ACG Research has found that through software automation, service providers cannot only accelerate new service introduction, but also substantially increase revenue.  With more rapid service introduction, service providers can expedite time to revenue, enable reduced services pricing, thus attracting more trial customers and finally obtain more paying customers faster.  In total, ACG Research analysis indicates that this virtuous software-enabled cycle can deliver as much as 400% higher revenue generation over a five year period vs. today’s highly manual new-service introduction processes. 

Click for more information about Tim Doiron or to discuss this topic contact Tim at tdoiron@acgcc.com.  

   Tim Doiron

   tdoiron@acgcc.com

   www.acgcc.com

Juniper Networks Cloud CPE Solution: Helping Providers Transition to Software-Centric Network

Vice President of Service Provider Portfolio Marketing at Juniper Networks Paul Obsitnik and Ray Mota, CEO, ACG Research, discuss the recent expansion of Juniper’s Network Functions Virtualization portfolio. Cloud CPE, which is a fully automated, end-to-end network functions virtualization solution, enables service providers to create and automatically deploy new services faster than ever at scale. The solution includes Contrail Service Orchestration, a comprehensive management and orchestration platform that delivers and manages virtualized network services and the NFX250, the first in a series of network services platforms that can operate as secure, on-premises devices running multiple virtual network functions from both Juniper and third parties. They also discuss the lineup of new Juniper professional services offerings to help customers and partners evaluate technology choices and develop a plan to integrate them within existing network infrastructures. Listen to Paul and Ray outline the four key benefits of the Cloud CPE solution for service providers and their customers.

Click for more information about ACG's video services.

Click for more information about ACG's video services.

Ray Mota

rmota@acgcc.com
www.acgcc.com

100% Visibility: An ACG HotSeat with with Dennis Cox

Dennis Cox, chief product officer of Ixia, and Ray Mota, CEO of ACG Research, discuss the need for true 100% visibility. Today, many vendors claim to provide 100% visibility, but many drop packets and create blind spots in your application performance. Understand what is needed for true visibility and providing a secure network for optimal application performance.

For more information about ACG’s HotSeat videos, contact sales@acgcc.com.

Ray Mota

rmota@acgcc.com
www.acgcc.com

Juniper Analyst Day Report

Juniper Networks’ full commitment to virtualization of the network was clear at the NXTWORK 2015. Juniper introduced Cloud CPE, a fully automated end-to-end NFV solution to enable its customers to implement a smooth migration strategy for their existing purpose-built networks to a virtualized, more efficient infrastructure. 

Key Findings

• Juniper’s Cloud CPE solution includes Contrail Service Orchestration, an important feature for both service creation and automation, that can greatly benefit their customers to gain competitive advantage in service introduction with faster time to market.

• Juniper’s Cloud CPE solution is the first of many NFV use cases that blends both physical and virtual network services together to simplify the service creation process and automate the entire service delivery process.

• Junos disaggregation is a good move by Juniper to decouple its software and hardware and place more value on Junos rather it hardware.

• Juniper’s competitors are also working on similar solutions. Juniper’s professional services becomes a major team to ensure its customer can roll out their virtualized infrastructure in a predictable time frame.

Click to download the Market Impact.

Click for more information about ACG’s business case analysis services or contact sales@acgcc.com.

 
         Robert Haim
     rhaim@acgcc.com
       www.acgcc.com

Innovation Drives Evolution: Video Industry No Exception

Analog over the air, on-demand and OTT experience are pushing vendors to evolve video technology and develop more sophisticated and viable business models

The first successfully demonstrated simple electronic television designed by Philo Taylor Farnsworth in 1927 transmitted a simple line. Philo T. Farnsworth, Vladimir Zworykin, C. Harles Jenkins and John Baird all made important contribution to this invention and contributed to what finally became television as we know it now, and which has helped spawn the huge video industry.

Back in time: TV history

In 1950 only nine percent of U.S. households owned a TV, but by 1960 87 percent owned one! Today, according to Nielsen, the number of TV households in the United States from 2010 to 2011 was estimated at 115.9 million and the average house has at least two televisions per household. 

In the 1950s the delivery method for content was over the air or terrestrial television in which the signal was transmitted by radio waves to the TV receiver from a television station, and received with an antenna. Viewers received significant benefit from this deliver method as content was easily accessible for the public. Using the antennas on the television, viewers would literally pull the signal out of the air. However, because the content was delivered over the air, there were distance limitations. An antenna could only transmit a signal so far, and if one was not within that range, one could not get the signal. Another limitation was that there was no way to institute a pay for access model. As the signals were being transmitted freely over the air, anyone with a reception antenna could view the signal. 

Next step in the evolution was the advent of cable television which delivered the video content to individual homes using coaxial cable. Large antennas were erected and coaxial cable ran from the antenna to individual homes. In coaxial cable transport, quality does not significantly deteriorate over distance, this delivery method also offered the ability for broadcasters and cable companies to create a subscription based model.

Then came satellite television, which delivered the video content to individual homes using signals relayed from communication satellites. The signals were received by  satellite dish which was then fed from the reception dish to inside the home through a coaxial cable. A satellite receiver, either a set-top box or a built-in TV tuner then decoded the program for viewing on a television set.

In 1984 digital video was invented and like OTA used radio frequencies to deliver video through the air. This technology allowed providers to compress video channels so that they take up less frequency space and offered two-way communication capabilities.

The most recent development is IPTV (live television, time-shifted television and VOD) which uses Internet Protocol for the delivery of video. This involves using hardware or software to encode the video and audio signals into an acceptable IP format that is then streamed in one direction or in a two-way scenario to provide users with interactive television. This development offers two advantages: Interactive ability where viewers can determine exactly what content they want to view and when and convenience. With wireless Internet and streaming capabilities, viewers can watch video content from their TV, laptops, tablets, and even their phones.

In IPTV, the subscribers have set-top boxes or other customer-premises equipment that talks directly over company-owned or dedicated leased lines with central-office servers. Packets never travel over the public Internet, so the television provider can guarantee enough local bandwidth for each customer's needs.

Shifting tide

Access on any device anywhere has prompted a shift from watching shows on TV to watching content on multiple devices. Additionally, high subscription costs, poor service, and the dismissive behavior from call centers are increasing the migration away from traditional cable services. Over-the-top content—film and TV services delivered directly over the internet to connected devices—has become a key part of the evolution of Video. Many consumers are opting to become “cord cutters” or are “cord nevers,” a generation raised on social media and Netflix that are used to any content, any time, on any device.

So how did OTT service become so enticing?

• Convenience: Anytime anywhere consumption

• Control: To choose what ,when and how to watch 

• Content: Availability of large existing content libraries

Where do we go from here?

The industry is on the cusp of the next major evolutionary phase in visual entertainment People are switching from traditional cable companies to watching videos online on their mobile phones, or through streaming services such as Netflix, Hulu, etc. Cord-cutting has grown by 44 percent in the past four years, with 7.6 million households using high-speed Internet for streaming or downloading videos instead of traditional cable or satellite television. The OTT market, already showing huge consumer uptake is expected to increase fourfold by 2019.

By leveraging OTT technologies and new business models, vendors and service providers are creating happier consumers, more profitable advertising, and a more efficient system overall. 

For more information about ACG’s video services, contact info@acgcc.com.


Meghna Zutshi
mzutshi@acgcc.com
www.acgcc.com

Migration of Services to the Data Center Driving Optical DCI Growth

ACG Research has released its Q2/2015 worldwide Optical Data Center Interconnect (DCI) market share analysis as well as its 2014–2019 worldwide forecast for Optical infrastructure platforms purchased by service providers for use in data center interconnect applications. Optical DCI product segmentation includes products designed for both long-haul and metro deployments, as well as a parallel view of the market based on large-scale multi-slot chassis platforms and small-form factor (SFF) optical appliances. The top three optical DCI suppliers worldwide in Q2/2015 are Ciena, Infinera and Alcatel-Lucent, respectively.

Purchases of Optical DCI equipment are expected to grow at a compound annual growth rate (CAGR) of 44.9% during the forecast period from just over $1.1 billion in 2014 to $4.7 billion in 2019. Sales of metro DCI platforms (supporting DCI connections up to 150 km) will continue to dominate over long-haul; both metro and long-haul will experience considerable growth at 51.5% and 24.6% CAGRs, respectively. Throughout the forecast period, the Americas and specifically North America remain the dominant geographical location for Optical DCI. EMEA and APAC regions demonstrate considerable optical DCI growth, but each remains about half the size of the Americas market.

Although the majority of Optical DCI deployments to date have been with multi-slotted chassis products, small-form factor Optical DCI appliances are entering the market at a rapid pace, led by Infinera’s two rack-unit (2RU) Cloud Xpress, which debuted in late 2014. Recent announcements from other vendors in the optical appliance category include Ciena’s Waveserver™ and Fujitsu’s 1Finity™ platforms. Adva also recently debuted its FSP3000 CloudConnect™ platform, though Adva is espousing a modular, 4RU chassis as “right-sized” for Optical DCI applications. Expect to see more product announcements in the future for this fast-growing product segment as revenue is projected to approach parity with large multi-slot chassis solutions in the last year of the forecast period.

“Uptake of Optical DCI is being driven by the migration of services to data centers and the cloud as service providers simplify deployment models and accelerate delivery of new and differentiated services,” says Tim Doiron, practice lead for Intelligent Transport Networking at ACG. “New and expanded data center deployments are being driven by a variety of service providers including Internet content providers (ICPs), network service providers (NSPs) and interexchange providers (IXPs) as well as enterprises themselves. As more functions become automated and virtualized, the need to interconnect data centers for capacity, resiliency and versatility will continue to grow and increase the need for reliable, cost-effective, high-speed data center interconnections.”

For more information about ACG’s data center interconnect services contact tdoiron@acgcc.com or info@acgcc.com.

Click for more information about Tim Doiron or to discuss this topic contact Tim at tdoiron@acgcc.com.

   Tim Doiron

   tdoiron@acgcc.com

   www.acgcc.com

1Mainstream Acquisition Will Drive Cisco’s Infinite Video Roadmap

Cisco Systems has announced its intent to buy OTT cloud streaming service provider 1Mainstream to deliver improved cloud-based and live-streaming services

The San Jose-based startup 1Mainstream was formed in 2012 to eliminate obstacles for content providers to create compelling, ala carte, HD channels and applications. It operates on an OTT platform that uses sophisticated templating technology to enable companies to launch OTT services across multiple platforms. Although far from being a household name, 1 Mainstream has partnerships with top companies, including Apple TV, Samsung, Roku, Amazon Fire TV, and Chromecast, to provide seamless integration of their products to a customer base that includes Sky News, NOW TV, Acacia TV, etc.

Cisco has a strong portfolio with videos for PCs, tablets and smartphones but the company was unable to serve both the service provider customers and OTT players that wanted to get to the big primary screen and get there fast. With the acquisition of 1 Mainstream, Cisco will now have the startup’s platform. 1Mainstream’s technology complements Cisco’s new Infinite suite of cloud-powered video entertainment solutions, which are designed to help customers deliver TV services to multiple screens utilizing one cloud on any access network within and beyond the home. 1Mainstream's platform will allow service providers, broadcasters and media companies to configure and roll out the entire channel and content library available to their customers anywhere and on any device.

Acquisition of 1Mainstream is a good move for Cisco as IPTV supporting OTT video content viewing has significantly disrupted the pay TV industry and has become a primary channel for content consumption. The acquisition is expected to be complete in the second quarter of Cisco’s current fiscal year and once the acquisition is complete, 1Mainstream will join the Service Provider Video Software and Solutions Cloud Engineering Group under the leadership of Conrad Clemson, senior vice president and general manager. Rajeev Raman, CEO of 1Mainstream, will become director of cloud engineering at Cisco.

For more information about ACG’s video services, contact info@acgcc.com.


Meghna Zutshi
mzutshi@acgcc.com
www.acgcc.com

Accelerating the Transformation to Virtual Network Services

The relentless pace of innovation is driving developers and service providers to redefine how they bring applications and services to users. Users’ demand for new applications is forcing a transformation away from limited function, tightly integrated and proprietary solutions toward a more fluid, programmable, adaptable service delivery environment. At the same time, competition for user engagement is fierce and operators need to find ways to become dramatically more efficient while they are also accelerating their pace of innovation.

Download Paul Parker-Johnson's whitepaper on what will fuel innovation and what F5 Networks is doing to unlock the potential in the always-on, fully-connected world and Accelerating the Transformation to Virtual Network Services.

Paul Parker-Johnson

pparkerjohnsoun@acgcc.com 

www.acgcc.com