Best of Times & Worst of Times in Video Mark Donnigan Marketing Head 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 for Beamr, a high-performance video encoding innovation company.
Best & Worst of Times in Video Mark Donnigan Marketing Leader at Beamr
Can a four character innovation save us?
This is a fascinating question due to the fact that there is a paradox emerging in the video business where it seems like the the very best of times for numerous, but the worst of times for some.
Here we have Disney revealing that they have currently accrued one billion dollars in loses, and this even before launching their direct to consumer service. And then we have Verizon Media revealing 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 of course there isn't a reporting period that passes where the cord cutting numbers haven't grown, which puts increasing pressure on the video side of the provider company.
Netflix stock is on the rise once again, permitting the business to invest in content at levels that need to bewilder their rivals. And then we have news of PlutoTV selling for a mouth watering $340 million dollars in money to Viacom (offer was announced on January 22, 2019), proving that the AVOD service model can be practical and rather important.
5G is going to save us all, right?
This is where I wish to get in touch with the massive investments being made in 5G and supply my viewpoint on why 5G may well break some video companies while at the same time make others.
Let's look at AT&T.
So in the last 4 years AT&T has actually included 80 billion dollars of additional debt leaving it with more than 160 billion dollars of short and long term debt. 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 analyst, however rather supply a viewpoint that the monetary scenario for AT&T entering into its huge 5G investment cycle, while at the same time making known their strategic effort to build up their video service capacity through Warner Media direct to customer offerings like HBO, and DirecTV, is going to be challenged, unless they do something really different with video.
What can a service company like AT&T do to address the financial capture, and the overall headwinds to the video business? Such as decreasing pay TV subs, and fragmenting OTT service offerings. This is the concern on numerous minds who are analyzing the future of the video organisation.
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've never ever seen prior to.
This will be great news for the PlutoTV's of the world and other innovative video services like Quibi who will be able to reach more customers with a better quality experience as an outcome of being able to utilize a quicker network thanks to 5G.
However, it's bad news for network operators without a plan to monetize this extra traffic load, and of course incumbents who are intending to get by with incremental improvements to their services; such as changing from managed to unmanaged, or OTT distribution, while continuing to utilize aging video requirements like H. 264 to provide low resolution mobile profiles.
Video distributors who continue to under serve their consumers will rapidly be at a disadvantage, and ripe for interruption, I think, from brand-new business models such as AVOD and the most recent and most efficient video technologies.
The 4 character video innovation that might conserve the video service.
The 4 character video requirement that I think will play a crucial function in the success of the video organisation is HEVC, the video codec that is now deployed on two billion devices. The following slide presentation provides numbers concerning HEVC device penetration which are worth seeing.
There has been much blogged about HEVC royalty concerns, something that triggered advancement of an alternative codec which probably is royalty complimentary. While some in the market ended up being preoccupied with questions around licensing and royalties, major advancements have been made on the legal front, including almost every CE gadget manufacturer consisting of HEVC playback assistance.
HEVC Advance waived all royalties for digital circulation of content. This implies, HEVC encoded content that is streamed will only carry a royalty for the hardware decoder and this is already covered by the getting device. Supplied that you are providing bits over the wire and not through a physical mechanism such as Blu-ray Disc, your business will not have to pay any extra royalties, at least not to HEVC Advance.
Now, if it's any convenience, the companies who have actually already done their due diligence on the royalty concern, and are streaming HEVC content to customers today, include: Amazon, Comcast, DirecTV, Meal Network, Netflix, Sky, Sony, Vudu, Vodafone, and Orange, simply to name a couple of.
What about HEVC playback support?
This is an excellent and essential concern and perhaps the location of development around the HEVC community that is least recognized or understood.
Beginning with at home playback, if your users have bought a TELEVISION, game console, Roku box or Apple TV in the last 3 years, you can be almost ensured that support for HEVC is present with no requirement for additional licensing or player upgrade.
HEVC is now resident in almost every SoC that goes in to any mid to high-end CE video device. That's 400 million devices that support HEVC natively.
The data business ScientiaMobile preserves the biggest dataset of network gadget gain access to profiles by getting information from the largest wireless operators on the planet. This company reports that a massive 78% of all iOS smart device demands originate 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 crucial gadget profile, and here the ScientiaMobile data is really encouraging with 57% of Android smart device demands originating from devices that support HEVC decoding.
And provided the HEVC gadget penetration and hardware support any worries about an early relocation to HEVC are not warranted. What other factors verify the concept that HEVC will be a booster to the video company?
LiveU recently released a report called 'State of Live' that showed growing patterns in HEVC broadcasting, specifically on the planet of sports. And simply in case you have thoughts that the usage of HEVC is a passing trend en route to some alternative codec, think about that in 2018, 25% of all LiveU generated traffic was streamed using the HEVC video requirement while the only other codec used was H. 264.
The report specified that the high HEVC use was a direct reflection on the increasing demand for professional-grade video quality, a pattern that was clearly obvious at the 2018 FIFA World Cup in Russia.
What does this mean for the market?
The trends we simply examined expose that we have an ever more demanding consumer who wants material that shows off the full capabilities of their seeing gadget, which indicates higher resolutions and advanced video requirements like HDR. But, this exact same user is now consuming more content, which contributes to further congesting the network.
This customer consumption pattern is clashing with a shift from managed The Best of Times & Worst of Times in the Video Business services to unmanaged, or OTT distribution and creating technical tension inside incumbent service operators who are dealing with technical shifts and organisation model fracturing. Remarkably, in spite of a really clear threat to the incumbent services who are seeing video subscriber loses installing into the numerous thousands over just a few short quarters, some are continuing with the status quo even while new entrants are launching services that give the consumer more for less.
This is where completion of the story will be written for some as the very 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 interrupt much of the standard operators and early OTT streaming services. Not because the consumer knows the difference between H. 264, VP9, and even HEVC, however because the customer is becoming mindful that much better quality is possible, and as they do, they will migrate to the service who provides the very best quality economically.
At Beamr, our company believe that the proof of our item and innovation quality must be knowledgeable and not just spoken about. Which is why we've put together the best offer that we have seen in the market where you can use our codecs in mix with our VOD transcoder, 100% totally free.
HEVC is now resident in nearly every SoC that goes in to any mid to high-end CE video device. These two numbers are where the picture of HEVC as the most logical video standard to follow H. 264, begins to take shape. Here we have significant video suppliers and tech business already encoding and distributing content in HEVC. And given the HEVC device penetration and hardware support any worries about a premature move to HEVC are not required. What other elements verify the idea 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 complimentary HEVC and H. 264 video transcoding every month. CLICK HERE
Originally published by: Mark Donnigan