Better than best-effort: Opportunities and challenges for...

Better than best-effort:Opportunities and challenges for video service providers and vendorsRob GallagherResearch Director, Consumer Services+44 (0) 7876 791 [email protected]@robdgallagher

Ovum | TMT intelligence | informa2 Copyright © Informa PLC

OTT will account for a growing share of TV revenues and an even larger share of users

Source: Ovum


OTT delivery is creating real new value for pay-TV operators too

• Premium multiscreen a growing reality

• Standalone OTT for large “cord-never” market

• Live esp. for sport a key requirement/differentiator

Source: Ovum

Source: Ovum


Up to 439mn SD-capable homes

At least 425mn HD-capable homes

At least 309mn 4K-capable homes

Consumer broadband bandwidth shouldn’t be a problem…

Source: Ovum


And yet… less than half of broadband users have “excellent” or “good” video experiences

Source: Ovum

n= 7,330


There is a correlation between quality and broadband speed… but not enough

Source: Ovum Source: Ovum

n= 7,330 n= 7,330

0%10%20%30%

40%50%60%

70%80%90%

100%

1Mbps to5Mbps

5Mbps to10Mbps

10Mbps to20Mbps

20Mbps to50Mbps

50Mbps to100Mbps

100Mbps+

How would you describe the picture quality when watching TV or video over broadband?

The picture is very poor The picture is acceptable

The picture is of variable quality It is good quality

It is excellent quality


Global, Internet traffic by type, 2013, 2015, and 2020Ovum’s Global Broadband Experience survey of 15,000

consumers in 30 developed and developing markets

There’s never been a better time for CDNs and operators to collaborate

Source: Ovum


CDN providers also need to increase quality of service - in more ways than one


Video performance issues have opened the door for challenger CDNs

Key

Global pureplay

Regional pureplay

Carrier CDN

Source: Ovum

n= 35


66% use two or more CDNs 35% of single CDN users plan to go multi-CDN

The crucial foot in that door? Multi-CDN strategies

Source: Ovum Source: Ovum

n= 52 n= 17


Quality of services trumps cost per GB Multi-CDN use is increasingly sophisticated

The rise of multi-CDN strategies will be unstoppable

20%

37%

43%

46%

54%

54%

Best interconnect with ISPs

Load balance between CDNs

Support different applications

Lowest cost per gigabyte (GB)

Ensure the highest QoS

Serve different countries/regions

Why do you use more than one CDN provider in Europe?

Third-party platform

66%

In-house platform

20%

Do not use14%

Do you use any of these platforms to manage your use of multiple CDN providers?

Source: Ovum

n= 35 n= 35

Source: Ovum


Drivers Solutions

Multi-CDN will help DIY CDN spread beyond major OTTs and network operators

Managed

Licensed

Open source

Multiscreen now core

Major TV events

Unreliable CDN performance

Lack of transparency

Service integration

Need to reduce costs

Spare capacity


OTT delivery has crossed the line from disruptor of the status quo to creator of value for both new and existing players

The theory that ever-growing broadband speeds alone will provide the headroom OTT video needs to seriously advance and improve is being challenged by reality

Great video experiences are now essential to broadband consumers, so there’s never been a greater incentive for operators, CDNs and content providers to collaborate

Quality of service - both in terms of network performance and customer support - will increasingly determine success in the CDN market

But no improvement in quality of service will halt the rise in multi-CDN and DIY CDN strategies - there’s just too much at stake

Key takeaways: Being better than best effort

Thank you. Questions?Rob GallagherResearch Director, Consumer Services+44 (0) 7876 791 [email protected]@robdgallagher

Better than best-effort: Opportunities and challenges for...

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