Best of Times & Bad Times in Video Mark Donnigan Marketing Leader at Beamr
Read the original LinkedIn article here: The Best of Times & Worst of Times in the Video Business
Mark Donnigan is VP Marketing at Beamr, a high-performance video encoding innovation company.
Best & Worst of Times in Video Mark Donnigan VP Marketing at Beamr
Can a four character technology save us?
This is an intriguing concern because there is a paradox emerging in the video organisation where it feels like the the finest of times for numerous, however the worst of times for some.
Here we have Disney revealing that they have already accrued one billion dollars in loses, and this even prior to releasing their direct to customer service. And after that we have Verizon Media announcing sweeping layoffs which represent an exit from a few of the core entertainment service and innovation organisations that were operating under the Oath umbrella.
And obviously there isn't a reporting period that goes by where the cable cutting numbers haven't grown, which puts increasing pressure on the video side of the provider organisation.
Yet, Netflix stock is on the increase again, allowing the company to invest in content at levels that must baffle their rivals. And after that we have news of PlutoTV selling for a mouth watering $340 million dollars in cash to Viacom (deal was announced on January 22, 2019), proving that the AVOD organisation model can be feasible and rather important.
5G is going to save us all, right?
This is where I wish to get in touch with the huge financial investments being made in 5G and offer my viewpoint on why 5G may well break some video companies while at the exact 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 incredible number was the outcome 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 financial circumstance for AT&T going into its enormous 5G investment cycle, while at the exact same time making known their strategic effort to build up their video service capability through Warner Media direct to customer offerings like HBO, and DirecTV, is going to be challenged, unless they do something really various with video.
What can a service provider like AT&T do to address the economic capture, and the general headwinds to the video service? Such as decreasing pay TELEVISION subs, and fragmenting OTT service offerings. This is the question on lots of minds who are examining the future of the video company.
It is my strong belief that common high speed mobile networks powered by 5G will release a video tsunami of traffic on the network like we have actually never seen before.
This will be excellent 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 a result of having the ability to take advantage of a faster network thanks to 5G.
However, it's bad news for network operators without a strategy to monetize this additional traffic load, and naturally incumbents who are intending to manage with incremental enhancements to their services; such as switching from managed to unmanaged, or OTT distribution, while continuing to utilize aging video requirements like H. 264 to deliver low resolution mobile profiles.
Video suppliers who continue to under serve their consumers will quickly be at a drawback, and ripe for interruption, I think, from new service models such as AVOD and the most recent and most effective video innovations.
The four character video innovation that may save the video service.
The four character video standard that I believe will play an essential function in the success of the video business is HEVC, the video codec that is now deployed on two billion devices. The following slide discussion offers numbers concerning HEVC gadget penetration which are worth seeing.
There has been much discussed HEVC royalty issues, something that set off development of an alternative codec which presumably is royalty totally free. While some in the market ended up being preoccupied with questions around licensing and royalties, significant advancements have been made on the legal front, consisting of nearly every CE device producer consisting of HEVC playback assistance.
HEVC Advance waived all royalties for digital circulation of material. This indicates, HEVC encoded content that is streamed will just bring 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 via a physical system such as Blu-ray Disc, your business will not need to pay any additional royalties, at least not to HEVC Advance.
Now, if it's any comfort, the business who have currently done their due diligence on the royalty question, and are streaming HEVC material to consumers today, consist of: Amazon, Comcast, DirecTV, Meal Network, Netflix, Sky, Sony, Vudu, Vodafone, and Orange, just to name a couple of.
What about HEVC playback support?
This is an excellent and crucial question and perhaps the area of advancement around the HEVC ecosystem that is least known or understood.
Starting with in-home playback, if your users have actually acquired a TELEVISION, video game console, Roku box or Apple TELEVISION in the last 3 years, you can be almost ensured that support for HEVC exists with no need for extra licensing or gamer upgrade.
HEVC is now resident in nearly every SoC that goes in to any mid to high-end CE video device. That's 400 million devices that support HEVC natively.
The information company ScientiaMobile preserves the biggest dataset of network gadget access profiles by getting information from the biggest wireless operators on the planet. This business reports that a tremendous 78% of all iOS smart device demands originate from devices that support hardware-accelerated HEVC decoding. And though iOS gadgets are predominant in many developed markets, Android is still an incredibly essential gadget profile, and here the ScientiaMobile information is extremely encouraging with 57% of Android mobile phone demands coming from devices that support HEVC decoding.
And offered the HEVC device penetration and hardware support any worries about an early relocation to HEVC are not called for. What other elements confirm the concept that HEVC will be a booster to the video business?
LiveU just recently published a report called 'State of Live' that showed growing trends in HEVC broadcasting, especially in the world of sports. And simply in case you have ideas that making use of HEVC Learn more is a passing trend en route to some alternative codec, consider that in 2018, 25% of all LiveU generated traffic was streamed utilizing the HEVC video standard while the only other codec used was H. 264.
In fact, the report specified that the high HEVC usage 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.
So what does this mean for the market?
The trends we simply analyzed expose that we have an ever more demanding customer who wants content that displays the full abilities of their viewing device, which means higher resolutions and more innovative video standards like HDR. This very same user is now consuming more material, which contributes to more crowding the network.
This consumer consumption pattern is clashing with a shift from managed services to unmanaged, or OTT circulation and producing technical stress inside incumbent service operators who are facing technical shifts and organisation model fracturing. Amazingly, in spite of an extremely clear threat to the incumbent services who are seeing video subscriber 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 provide the customer more for less.
This is where completion of the story will be composed for some as the finest of times, and for others as the worst of times.
HEVC is more than a technology enabler. It's a video requirement that is set to interfere with a lot of the standard operators and early OTT streaming services. Not because the customer understands the distinction between H. 264, VP9, or even HEVC, however since the customer is becoming conscious that better quality is possible, and as they do, they will migrate to the service who provides the finest quality affordably.
At Beamr, we believe that the proof of our product and technology excellence must be experienced and not simply spoken about. Which is why we have actually created the very best offer that we have seen in the industry where you can utilize our codecs in combination with our VOD transcoder, 100% for free.
HEVC is now resident in almost every SoC that goes in to any mid to high-end CE video gadget. These 2 numbers are where the photo of HEVC as the most sensible video requirement to follow H. 264, starts to take shape. Here we have major video suppliers and tech business already encoding and distributing material in HEVC. And offered the HEVC device penetration and hardware support any worries about a premature move to HEVC are not warranted. What other elements verify the concept that HEVC will be a booster to the video service?
You can check out Beamr's software video encoders today and get up to 100 hours of free HEVC and H. 264 video transcoding each month. CLICK HERE
Originally published by: Mark Donnigan