Tuesday, April 22, 2014

Video monetization & optimization 2014 executive summary

As announced earlier this month, my latest report "Mobile video monetization and optimization 2014" is out.

In 2014, mobile video is a fact of life. It has taken nearly 5 years for the service to transition from novelty to a growing habit that is quickly becoming an everyday occurrence in mature markets. Nearly a quarter of YouTube and Netflix views nowadays are on a tablet or a smartphone. Of course, users predominantly still stream over wifi, but as LTE slowly progresses across markets, users start to take for granted the network capacity to deliver video.

Already, LTE networks start to show signs of weariness as video threatens the infrastructure and the business model of mobile content delivery.

On the regulatory front, with the US appeal court served in January ruling that the FCC had no authority to impose "Open Internet Order" (net neutrality) rules to broadband carriers, there is a wind of hope and fear that blows across the traffic management market.

Almost concurrently, we are seeing initiatives from network operators and OTT alike to find new footings for business models and cooperation / competition.
  •       AT&T is experimenting with sponsored data plans,
  •       Verizon has bought a CDN,
  •       Deutsche Telekom partners with Evernote and Spotify,
  •       Orange persists investigating Telco OTT with Libon,
  •       Uninor India wants to charge for Facebook,
  •       Netflix is trialing tiered pricing,
  •       Facebook and Google are hinting at operating wireless networks…

In the meantime, mobile advertising still hasn't delivered on the promises of taking advantage of a hyper targeted, location-aware, contextually relevant service. Privacy concerns are at their highest, with the fires started by Wikileaks and Edward Snowden’ NSA scandals, fanned by “free internet” activists and a misinformed public.

Quality of Experience is a growing trend, from measurement to management and experience assurance is starting to make its appearance, buoyed by a series of vague announcements and launches in the analytics, big data, and network virtualization field.

Legacy (already?!) video optimization vendors see the emergence of smarter, more cost-effective and policy-driven platforms. The technology has not delivered fully on cost reduction, but is being implemented for media inspection, analytics, media policy enforcement and control and lately video centric pricing models and bundles.

With the acquisition of the market leader last year and the merger of the number 2 and 3 in market share at the beginning of this year, we have seen video optimization trials and RFx being delayed in their decision making.

Video optimization in 2014 is a mature market segment. The technology has been deployed in over 200 networks globally.

{Core Analysis} believe that video optimization will continue to be deployed in most networks as a media policy enforcement point and for media analytics.

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