Best & Worst of Times in Video Mark Donnigan Marketing Head 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.
The Video Business is in the Best of Times or the Worst of Times? Mark Donnigan VP Marketing at Beamr
Can a 4 character technology save us?
This is a fascinating concern due to the fact that there is a paradox emerging in the video company where it feels like the the best of times for numerous, but 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 before introducing their direct to customer organisation. And after that we have Verizon Media revealing sweeping layoffs which represent an exit from some of the core entertainment service and technology services that were operating under the Oath umbrella.
And obviously there isn't a reporting interval that goes by where the cable cutting numbers haven't grown, which puts increasing pressure on the video side of the company company.
Yet, Netflix stock is on the increase once again, permitting the company to buy content at levels that must mystify their rivals. And then we have news of PlutoTV selling for a mouth watering $340 million dollars in cash to Viacom (offer was announced on January 22, 2019), proving that the AVOD business model can be feasible and rather valuable.
5G is going to conserve all of us, right?
This is where I desire to link with the huge investments being made in 5G and supply my viewpoint on why 5G may well break some video companies while at the exact same time make others.
Let's look at AT&T.
So in the last four years AT&T has actually included 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 financial obligation numbers, I'm not an analyst, but rather provide a point of view that the financial circumstance for AT&T going into its massive 5G investment cycle, while at the very same time making understood their tactical initiative to develop 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.
So what can a company like AT&T do to address the financial squeeze, and the overall headwinds to the video organisation? Such as decreasing pay TV subs, and fragmenting OTT service offerings. This is the question on numerous 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 let loose 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 consumers with a better quality experience as a result of having the ability to utilize a faster network thanks to 5G.
It's bad news for network operators without a strategy to monetize this extra traffic load, and of course incumbents who are hoping to get by with incremental enhancements to their services; such as changing from handled to unmanaged, or OTT circulation, while continuing to utilize aging video requirements like H. 264 to provide low resolution mobile profiles.
Video suppliers who continue to under serve their consumers will rapidly be at a drawback, and ripe for interruption, I think, from new service designs such as AVOD and the most recent and most efficient video technologies.
The four character video technology that may save the video business.
The four character video requirement that I think will play an essential role in the success of the video company is HEVC, the video codec that is now released on 2 billion devices. The following slide presentation supplies numbers relating to HEVC gadget penetration which are worth seeing.
There has been much blogged about HEVC royalty issues, something that set off development of an alternative codec which presumably is royalty complimentary. Nevertheless, while some in the industry became preoccupied with concerns around licensing and royalties, major developments have actually been made on the legal front, consisting of nearly every CE gadget producer including HEVC playback assistance.
HEVC Advance waived all royalties for digital distribution of content. This indicates, HEVC encoded content that is streamed will just bring a royalty for Click Here to Learn More the hardware decoder and this is currently covered by the getting device. Supplied that you are delivering bits over the wire and not by means of 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 material to consumers today, consist of: Amazon, Comcast, DirecTV, Meal Network, Netflix, Sky, Sony, Vudu, Vodafone, and Orange, simply among others.
What about HEVC playback support?
This is an excellent and essential concern and possibly the location of development around the HEVC environment that is least known or comprehended.
Starting with in-home playback, if your users have actually purchased a TV, video game console, Roku box or Apple TV in the last 3 years, you can be nearly ensured that assistance for HEVC is present without any requirement for extra licensing or player upgrade.
HEVC is now resident in nearly every SoC that goes in to any mid to high-end CE video device. In truth, since 2015, industry reports reveal this group of items numbers 400 million. That's 400 million devices that support HEVC natively. It's an excellent start, but what about mobile?
The information business ScientiaMobile maintains the largest dataset of network device access profiles by getting information from the biggest cordless operators in the world. This company reports that a massive 78% of all iOS mobile phone demands originate from gadgets that support hardware-accelerated HEVC decoding. And though iOS devices are primary in a lot of developed markets, Android is still a very essential gadget profile, and here the ScientiaMobile information is really motivating with 57% of Android smart device demands originating from gadgets that support HEVC decoding.
And given the HEVC device penetration and hardware support any concerns about an early move to HEVC are not required. What other factors confirm the concept that HEVC will be a booster to the video organisation?
LiveU recently published a report called 'State of Live' that revealed growing trends in HEVC broadcasting, especially worldwide of sports. And simply in case you have thoughts that making use of HEVC is a passing pattern 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 utilized was H. 264.
In reality, the report stated that the high HEVC use was a direct reflection on the increasing need for professional-grade video quality, a trend that was plainly apparent at the 2018 FIFA World Cup in Russia.
So what does this mean for the industry?
The patterns we just took a look at expose that we have an ever more requiring consumer who desires content that reveals off the full abilities of their seeing device, which means higher resolutions and more advanced video requirements like HDR. This exact same user is now taking in more content, which contributes to additional crowding the network.
This consumer intake pattern is hitting a shift from managed services to unmanaged, or OTT circulation and creating technical stress inside incumbent service operators who are facing technical shifts and company design fracturing. Exceptionally, in spite of a very clear risk to the incumbent services who are seeing video customer loses mounting into the hundreds of thousands over simply a couple of brief quarters, some are continuing with the status quo even while new entrants are introducing services that offer the consumer more for less.
This is where the end 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 an innovation 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, or perhaps HEVC, however because the consumer is ending up being mindful that much better quality is possible, and as they do, they will move to the service who provides the best quality affordably.
At Beamr, we believe that the proof of our product and technology excellence should be skilled and not simply spoken about. Which is why we have actually created the very best deal that we have actually seen in the market where you can utilize our codecs in mix with our VOD transcoder, 100% free of charge.
HEVC is now resident in nearly every SoC that goes in to any mid to high-end CE video gadget. These 2 numbers are where the image of HEVC as the most sensible video standard to follow H. 264, begins to take shape. Here we have major video distributors and tech business currently encoding and dispersing content in HEVC. And provided the HEVC device penetration and hardware support any worries about an early relocation to HEVC are not necessitated. What other aspects verify the idea that HEVC will be a booster to the video company?
You can attempt out Beamr's software application video encoders today and get up to 100 hours of free HEVC and H. 264 video transcoding each month. CLICK HERE
Author: Mark Donnigan