Best of Times & Bad Times in Video Mark Donnigan Marketing Leader at Beamr
Get the original LinkedIn article here: The Best of Times & Worst of Times in the Video Business
Mark Donnigan is Vice President of Marketing at Beamr, a high-performance video encoding technology company.
Best & Worst of Times in Video Mark Donnigan Marketing Leader at Beamr
Can a 4 character innovation save us?
This is a fascinating concern because there is a paradox emerging in the video service where it seems like the the very best of times for many, however the worst of times for some.
Here we have Disney announcing that they have actually currently accumulated one billion dollars in loses, and this even prior to releasing their direct to customer service. And then we have Verizon Media announcing sweeping layoffs which represent an exit from some of the core home entertainment service and technology businesses that were running under the Oath umbrella.
And naturally there isn't a reporting period that goes by 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 rise again, permitting the business to invest in content at levels that must mystify their rivals. And after that we have news of PlutoTV selling for a mouth watering $340 million dollars in cash to Viacom (offer was revealed on January 22, 2019), proving that the AVOD business model can be feasible and quite important.
5G is going to conserve us all?
This is where I want to get in touch with the enormous investments being made in 5G and provide my point of view on why 5G might well break some video companies while at the very same time make others.
Let's take a look at AT&T.
In the last 4 years AT&T has actually added 80 billion dollars of extra financial obligation leaving it with more than 160 billion dollars of brief and long term financial obligation. 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, however rather provide a perspective that the monetary scenario for AT&T entering into its huge 5G investment cycle, while at the exact same time making known their strategic effort to construct up their video service capacity through Warner Media direct to consumer offerings like HBO, and DirecTV, is going to be challenged, unless they do something very different with video.
So what can a service company like AT&T do to resolve the financial squeeze, and the general headwinds to the video organisation? Such as decreasing pay TV subs, and fragmenting OTT service offerings. This is the concern on lots of minds who are analyzing the future of the video business.
It is my strong belief that ubiquitous high speed mobile networks powered by 5G will let loose a video tsunami of traffic on the network like we've never ever seen before.
This will be good news for the PlutoTV's of the world and other ingenious video services like Quibi who will be able to reach more customers with a better quality experience as an outcome of having the ability to take advantage of a much faster network thanks to 5G.
But, it's bad news for network operators without a strategy to monetize this extra traffic load, and of course incumbents who are hoping to manage with incremental enhancements to their services; such as changing from handled to unmanaged, or OTT circulation, while continuing to utilize aging video standards like H. 264 to provide low resolution mobile profiles.
Video distributors who continue to under serve their customers will rapidly be at a disadvantage, and ripe for interruption, I believe, from new service designs such as AVOD and the latest and most effective video innovations.
The four character video technology that may save the video service.
The four character video standard that I believe will play a crucial role in the success of the video organisation is HEVC, the video codec that is now released on two billion devices. The following slide discussion offers numbers relating to HEVC device penetration which are worth seeing.
There has actually been much discussed HEVC royalty concerns, something that activated advancement of an alternative codec which presumably is royalty complimentary. However, while some in the market became preoccupied with questions around licensing and royalties, significant developments have been made on the legal front, consisting of almost every CE device producer consisting of HEVC playback assistance.
For instance, HEVC Advance waived all royalties for digital circulation of material. This indicates, HEVC encoded content that is streamed will just carry a royalty for the hardware decoder and this is currently covered by the getting gadget. Provided that you are delivering bits over the wire and not through a physical system such as Blu-ray Disc, your company will not need to pay any extra royalties, at least not to HEVC Advance.
Now, if it's any comfort, the business who have actually already done their due diligence on the royalty concern, and are streaming HEVC content to consumers today, include: Amazon, Comcast, DirecTV, Dish Network, Netflix, Sky, Sony, Vudu, Vodafone, and Orange, simply to call a couple of.
What about HEVC playback assistance?
This is an excellent and essential question and perhaps the area of advancement around the HEVC community that is least known or comprehended.
Beginning with in-home playback, if your users have actually acquired a TV, game console, Roku box or Apple TV in the last 3 years, you can be nearly ensured that support for HEVC is present with no need for extra licensing or gamer upgrade.
HEVC is now resident in almost every SoC that goes in to any mid to high-end CE video gadget. That's 400 million devices that support HEVC natively.
The data business ScientiaMobile preserves the biggest dataset of network device gain access to profiles by receiving data from the biggest wireless operators worldwide. This company reports that a massive 78% of all iOS smartphone demands come from devices that support hardware-accelerated HEVC decoding. And though iOS gadgets are predominant in a lot of industrialized markets, Android is still an incredibly important device profile, and here the ScientiaMobile information is really encouraging with 57% of Android mobile phone demands coming from devices that support HEVC decoding.
These 2 numbers are where the picture of HEVC as the most logical video standard to follow H. 264, starts to take shape. Here we have significant video suppliers and tech companies already encoding and distributing content in HEVC. And provided the HEVC gadget penetration and hardware support any concerns about a premature relocate to HEVC are not warranted. But, what other elements verify the concept that HEVC will be a booster to the video company?
LiveU just recently released a report called 'State of Live' that showed growing trends in HEVC broadcasting, especially in the world of sports. And just in case you have thoughts that the use of HEVC is a passing pattern en route to some alternative codec, think about that in 2018, 25% of all LiveU created traffic was streamed utilizing the HEVC video requirement while the only other codec utilized was H. 264.
In truth, the report specified that the high HEVC use was a direct reflection on the increasing demand for professional-grade video quality, a trend that was plainly obvious at the 2018 FIFA World Cup in Russia.
What does this mean for the market?
The patterns we just examined expose that we have an ever more demanding consumer who wants material that reveals off the full capabilities of their seeing device, which suggests higher resolutions and more innovative video requirements like HDR. This same user is now consuming more material, which contributes to additional congesting the network.
This customer usage pattern is hitting a shift from handled services to unmanaged, or OTT distribution and developing technical tension inside incumbent service operators who are dealing with technical shifts and company design fracturing. Remarkably, in spite of a really clear risk to the incumbent services who are seeing video customer loses installing into the hundreds of thousands over simply a couple of short quarters, some are continuing with the status quo even while 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 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 disrupt a lot of the conventional operators and early OTT streaming services. Not due to the fact that the consumer knows the difference between H. 264, VP9, and even HEVC, however because the consumer is realising that much better quality is possible, and as they do, they will move to the service who provides the very best quality affordably.
At Beamr, our company believe that the proof of our product and technology excellence must be experienced and not just talked about. Which is why we've put together the very best deal that we have actually seen in the industry where you can use our codecs More Information in mix with our VOD transcoder, 100% totally free.
HEVC is now resident in almost every SoC that goes in to any mid to high-end CE video device. These 2 numbers are where the image of HEVC as the most sensible video requirement to follow H. 264, starts to take shape. Here we have significant video distributors and tech companies currently encoding and dispersing content in HEVC. And given the HEVC device penetration and hardware support any worries about a premature relocation to HEVC are not required. What other factors confirm the concept that HEVC will be a booster to the video service?
You can try out Beamr's software video encoders today and get up to 100 hours of complimentary HEVC and H. 264 video transcoding monthly. CLICK HERE
Author: Mark Donnigan