Best of Times & Bad Times in the Video Business Mark Donnigan VP Marketing 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 technology company.
Best & Worst of Times in Video Mark Donnigan VP Marketing at Beamr
Can a four character technology save us?
This is a fascinating question since there is a paradox emerging in the video service where it seems like the the very best of times for many, but the worst of times for some.
Here we have Disney announcing that they have actually currently accrued one billion dollars in loses, and this even before launching their direct to consumer business. And then we have Verizon Media announcing sweeping layoffs which represent an exit from some of the core 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 service supplier organisation.
Yet, Netflix stock is on the increase once again, permitting the business to invest in content at levels that need to 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 revealed on January 22, 2019), proving that the AVOD business design can be practical and rather important.
5G is going to save all of us, right?
This is where I want to link with the massive financial investments being made in 5G and offer my perspective on why 5G might well break some video companies while at the same time make others.
Let's take a look at AT&T.
So in the last four years AT&T has included 80 billion dollars of extra debt 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, but rather offer a perspective that the financial scenario for AT&T going into its enormous 5G investment cycle, while at the exact same time making understood their strategic initiative to develop their video service capacity through Warner Media direct to customer offerings like HBO, and DirecTV, is going to be challenged, unless they do something extremely various with video.
So what can a company like AT&T do to attend to the financial squeeze, and the general headwinds to the video company? 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 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've never seen before.
This will be great news for the PlutoTV's of the world and other ingenious video services like Quibi who will have the ability to reach more consumers with a better quality experience as a result of being able to take advantage of a much 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 switching from managed to unmanaged, or OTT distribution, while continuing to use aging video standards like H. 264 to deliver low resolution mobile profiles.
Video distributors who continue to under serve their customers will rapidly be at a downside, and ripe for disturbance, I think, from brand-new service models such as AVOD and the most recent and most effective video innovations.
The four character video technology that may conserve the video organisation.
The 4 character video standard that I believe will play a key function 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 concerning HEVC device penetration which deserve seeing.
There has actually been much written about HEVC royalty concerns, something that activated advancement of an alternative codec which most likely is royalty free. While some in the market became preoccupied with More Info concerns around licensing and royalties, major advancements have been made on the legal front, consisting of almost every CE gadget producer consisting of HEVC playback support.
HEVC Advance waived all royalties for digital circulation of content. This indicates, HEVC encoded material that is streamed will just bring a royalty for the hardware decoder and this is currently covered by the receiving gadget. Supplied that you are providing bits over the wire and not through a physical mechanism such as Blu-ray Disc, your company will not need to pay any additional royalties, a minimum of not to HEVC Advance.
Now, if it's any comfort, the business who have actually currently done their due diligence on the royalty question, and are streaming HEVC material to consumers today, include: Amazon, Comcast, DirecTV, Dish Network, Netflix, Sky, Sony, Vudu, Vodafone, and Orange, just among others.
What about HEVC playback support?
This is a very excellent and important concern and maybe the area of advancement around the HEVC ecosystem that is least known or comprehended.
Beginning with in-home playback, if your users have actually bought a TELEVISION, video game console, Roku box or Apple TV in the last 3 years, you can be almost ensured that assistance for HEVC is present without any need for extra licensing or gamer upgrade.
HEVC is now resident in practically every SoC that enters to any mid to high-end CE video device. Considering that 2015, market reports show this group of products numbers 400 million. That's 400 million devices that support HEVC natively. It's an excellent start, however what about mobile?
The data company ScientiaMobile preserves the biggest dataset of network gadget gain access to profiles by getting information from the biggest wireless 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 gadgets are primary in most developed markets, Android is still a very crucial gadget profile, and here the ScientiaMobile information is really encouraging with 57% of Android mobile phone demands originating from gadgets 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 factors confirm the concept that HEVC will be a booster to the video company?
LiveU recently released a report called 'State of Live' that showed growing trends in HEVC broadcasting, especially worldwide of sports. And just in case you have thoughts that the usage of HEVC is a passing trend on the way to some alternative codec, think about that in 2018, 25% of all LiveU produced traffic was streamed using the HEVC video requirement while the only other codec used was H. 264.
In reality, the report specified that the high HEVC usage 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 trends we simply examined expose that we have an ever more demanding customer who wants material that shows off the full abilities of their viewing gadget, which implies greater resolutions and advanced video standards like HDR. However, this exact same user is now consuming more content, which adds to further crowding the network.
This customer consumption pattern is colliding with a shift from handled services to unmanaged, or OTT circulation and creating technical stress inside incumbent service operators who are dealing with technical shifts and business design fracturing. Incredibly, in spite of an extremely clear threat to the incumbent services who are seeing video subscriber loses installing into the numerous thousands over simply a few short quarters, some are continuing with the status quo even while new entrants are releasing services that offer the consumer more for less.
This is where the end of the story will be composed 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 a number of the standard operators and early OTT streaming services. Not because the consumer understands the distinction between H. 264, VP9, or even HEVC, but since the customer is realising that better quality is possible, and as they do, they will migrate to the service who delivers the very best quality affordably.
At Beamr, our company believe that the proof of our product and technology excellence must be skilled and not just discussed. Which is why we have actually assembled the best offer that we have actually seen in the industry where you can utilize our codecs in mix with our VOD transcoder, 100% for 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 photo of HEVC as the most logical video requirement to follow H. 264, begins to take shape. Here we have significant video distributors and tech business currently encoding and distributing material in HEVC. And provided the HEVC gadget penetration and hardware support any concerns about a premature relocation to HEVC are not called for. What other elements verify the idea that HEVC will be a booster to the video business?
You can check out Beamr's software application video encoders today and get up to 100 hours of complimentary HEVC and H. 264 video transcoding each month. CLICK HERE
Originally published by: Mark Donnigan