State of Open RAN 2024: Executive Summary

 

The 2023 Open RAN market ended with a bang with AT&T awarding to Ericsson and Fujitsu a $14 billion deal to convert 70% of its traffic to run on Open RAN by end of 2026. 2024 started equally loud with the $13 billion acquisition of Juniper Networks from HPE on the thesis of the former company’s progress in telecoms AI and specifically in RAN intelligence with the launch of their RIC program.

2023 also saw the long-awaited launch of Drillish 1&1 in Germany, the first Open RAN greenfield in Europe, as well as the announcement from Vodafone that they will release a RAN RFQ that will see 30% of its 125,000 global sites dedicated to Open RAN.

Commercial deployments are now under way in western Europe, spurred by Huawei replacement mandates.

On the vendor’s front, Rakuten Symphony seems to have markedly failed to capitalize on Altiostar’s acquisition and convince brownfield network operators to purchase telecom gear from a fellow network operator. While Ericsson has announced its support for Open RAN with conditions, Samsung has been the vendor making the most progress with convincing market share growth across the geographies it covers. Mavenir has been steadily growing. A new generation of vendors have taken advantage of the Non-Real-Time RIC / SMO opportunity to enter the space. Non-traditional RAN vendors such as VMWare and Juniper Networks or SON vendors like Airhop have grown the most in that space, together with pure new entrants App players such as Rimedo Labs. With the acquisition of VMWare and Juniper Networks, both leaders in the RIC segment, 2024 could be live or die for this category, as the companies are reevaluating their priorities and aligning commercial interest with their acquirers.

On the technology side, the O-RAN alliance has continued its progress, publishing new releases while establishing bridgeheads with 3GPP and ETSI to facilitate the inclusion of Open RAN in the mainstream 5G advanced and 6G standards. The accelerator debate between inline and look aside architectures has died down, with the first layer 1 abstraction layers allowing vendors to effectively deploy on different silicon with minimal adjustment. Generative AI and large language models have captured the industry’s imagination and Nvidia has been capitalizing on the seemingly infinite appetite for specialized computing in cloud and telecom networks.

This report provides an exhaustive review of the key technology trends, vendors product offering, and strategies, ranging from silicon, servers, cloud CaaS, Open RUs, DU, CUs, RICs, apps and SMOs in the open RAN space in 2024.

Product Marketing as a Strategic Tool for Telco Vendors

Those who know me for a long time know that I am a Product Manager by trade. This is how I started my career and little by little, from products, to product lines, to solutions I have come to manage and direct business lines worth several hundred of millions of dollars. Along this path, I have become also a manager and team lead, then moved onto roles with increasing strategic content, from reselling, OEM, deals to buy and sell side acquisitions and integrations.

Throughout this time, I have noticed the increased significance of Product Marketing in the telecoms vendors environment. In a market that has seen (and is still seeing) much concentration, with long sales cycles and risk-adverse customers, being able to intelligently and simply state a product's differentiating factor becomes paramount.

Too often, large companies rely on brand equity and marketing communication to support sales. In a noisy market, large companies have many priorities, which end up diluting the brand promise and provide vague and disconnected messages across somewhat misaligned product and services.

By contrast, start ups and small companies often have much smaller range of products and services, but having less budget, focus in may case on technology and technical illustrations rather than exalting the benefits and value of their offering.

My experience has underscored the pivotal role of product marketing in shaping a company's valuation, whether for fundraising or acquisition purposes. Yet, despite its proven impact, many still regard it as a peripheral activity. The challenge lies in crafting a narrative that resonates—a narrative that not only embodies the company's strategic vision but also encapsulates market trends, technological evolutions, and competitive dynamics. It's about striking a delicate balance, weaving together product capabilities, customer pain points, and the distinct value proposition in a narrative that is both compelling and credible.

Many companies will have marketing communication departments working on product marketing, which often results in either vague and bland positioning or in disconnects between the claims and the true capabilities of the products. This can be very damaging for a company's image when its market claims do not reflect accurately the capabilities of the product or the evolution of the technology. 

Other companies have the product marketing as part of the product management function, whereas the messaging and positioning might be technically accurate, but lack competitive and market awareness to resonate and find a differentiating position that will maximize the value of the offering.

As the telecoms vendors' sector braces for heightened competition and market contraction, with established players fiercely guarding protecting their market share against aggressive newcomers, the role of product marketing becomes increasingly critical. It's an art form that merits recognition, demanding heightened attention and strategic investment. For those poised to navigate this complex terrain, embracing product marketing is not just an option; it's an imperative for sustained relevance and success in challenging market conditions. 

Edge computing risks and opportunities for operators and hyperscalers

 Part of a presentation to the World Bank's investment teams regarding institutional investment in ICT for emerging countries.

Edge Computing risks and Opportunities for Telco and hyperscalers from Patrick Lopez

MEC: The 7B$ opportunity

Extracted from Mobile Edge Computing 2016.

Executive summary

Table of contents

Defining an addressable market for an emerging product or technology is always an interesting challenge. On one hand, you have to evaluate the problems the technology solves and their value to the market, and on the other hand, appreciate the possible cost structure and psychological price expectations from the potential buyer / users.

This warrants a top down and bottoms up approach to look at how the technology can contribute or substitute some current radio and core networks spending, together with a cost based review of the potential physical and virtual infrastructure. [...]

The cost analysis is comparatively easy, as it relies on well understood current cost structure for physical hardware and virtual functions. The assumptions surrounding the costs of the hardware has been reviewed with main x86 based hardware vendors. The VNFs pricing relies on discussions with large and emerging telecom equipment vendors for standard VNFs such as EPC, IMS, encoding, load balancers, DPI… price structure. Traditional telco professional services, maintenance and support costs are apportioned and included in the calculations.

The overall assumption is that MEC will become part of the fabric of 5G networks and that MEC equipment will cover up to 20% of a network (coverage or population) when fully deployed.
The report features total addressable market, cumulative and incremental for MEC equipment vendors and integrator, broken down by CAPEX / OPEX, consumer, enterprises and IoT services.
It then provides a review of operators opportunities and revenue model for each segment.

2015 review and 2016 predictions

As is now customary, I try to grade what I was predicting for 2015 and see what panned out and what didn't. I'll share as well what I see for 2016.

Content providers, creators, aggregators:

"They will need to simultaneously maximize monetization options by segmenting their user base into new price plans and find a way to unlock value in the mobile market.While many OTT, particularly social networks and radio/ audio streaming have collaborated and signed deals with mobile network operators, we are seeing also a tendency to increasingly encrypt and obfuscate online services to avoid network operators meddling in content delivery." 

On that front, I think that both predictions held true. I was envisioning encryption to jump from 10 to 30% of overall data traffic and I got that wrong, at least in many mature markets, where Netflix is big in mobile, we see upwards of 50% of traffic being encrypted. I still claim some prediction here, with one of my first post indicating the encryption trend 2 years before it started in earnest.

The prediction about segmentation from pricing as OTT services mature has been also largely fulfilled, with YouTube's 4th attempt, by my count, to launch a paid service. Additionally, the trend about content aggregators investing in original content rights acquisition is accelerating with Amazon gearing up for movie theaters and Netflix outspending traditional providers such as BBC with a combined investment by both company estimated in the 9$Bn range. Soon, we are talking real money.

In 2016, we will see an acceleration of traditional digital services that were originally launched for fixed line internet transitioning to predominantly mobile or mobile only plays. Right now, 47% of Facebook users are exclusively through  mobile and account for 78% of the company's revenue. More than 50% of YouTube views are on mobile devices and the corresponding revenue growth is over 100% year on year. 49% of Netflix' 18 to 34 years old demographics watches the service on mobile devices. We have seen signs with Twitter's vine,  and Periscope as well as Spotify , MTV and Facebook that the battlefield will be on video services.

Network operators: Wholesaler or value providers?
The operators in 2016 are still as confused, as a community as in 2015. They perceive threats from each other, which causes many acquisitions, from OTTs, which causes in equal measure many partnership and ill-advised service launches and from regulatory bodies, which causes lawyers to fatten up at the net neutrality / privacy buffet.

"we will see both more cooperation and more competition, with integrated offering (OTT could go full MVNO soon) and encrypted, obfuscated traffic on the rise". 

We spoke about encryption, the OTT going full MVNO was somewhat fulfilled by Google's disappointing project Fi launch. On the cooperation front, we have seen a flurry of announcements, mostly centered around sponsored data or zero rated subscription services from Verizon, AT&T.

"We will probably also see the first lawsuits from OTT to carriers with respect to traffic mediation, optimization and management. " 

I got that half right. No lawsuit from content providers but heavy fines from regulators on operators who throttle, cap or prioritize content (Sprint, AT&T, ...).

As for digital service providers, network operators are gearing themselves to compete on video services with services such as mobile TV /LTE broadcast (AT&T, EE, Telekom Slovenje, Vodafone), events streaming (China Telecom, ), sponsored data / zero rated subscription services (Verizon, T-mobile Binge On, Sprint, AT&T, Telefonica, ...).

"Some operators will seek to actively manage and mediate the traffic transiting through their networks and will implement HTTPS / SPDY proxy to decrypt and optimize encrypted traffic, wherever legislation is more supple."

I got that dead wrong. Despite interest and trials, operators are not ready to go into open battle with OTT just yet. Decrypting encrypted traffic is certainly illegal in many countries
or at the very least hostile and seems to be only expected from government agencies...

Mobile Networks Technology

"CAPEX will be on the rise overall with heterogeneous networks and LTE roll-out taking the lion share of investments. LTE networks will show signs of weakness in term of peak traffic handling mainly due to video and audio streaming and some networks will accelerate LTE-A investments or aggressively curb traffic through data caps, throttles and onerous pricing strategies."

Check and check.

"SDN will continue its progress as a back-office and lab technology in mobile networks but its incapacity to provide reliable, secure, scalable and manageable network capability will prevent it to make a strong commercial debut in wireless networks. 2018 is the likeliest time frame."

I maintain the view that SDN is still too immature for mass deployment in mobile networks, although we have seen encouraging trials moving from lab to commercial, we are still a long way from a business case and technology maturity standpoint before we see a mobile network core or RAN running exclusively or mostly on SDN.

"NFV will show strong progress and first commercial deployments in wireless networks, but in vertical, proprietary fashion, with legacy functions (DPI, EPC, IMS...) translated in a virtualized environment in a mono vendor approach. "

We have seen many examples of that this year with various levels of industry and standard support from Connectem, Affirmed Networks, Ericsson, Cisco and Huawei.

"Orchestration and integration with SDN will be the key investments in the standardization community. The timeframe for mass market interoperable multi vendor commercial deployment is likely 2020."

Orchestration, MANO has certainly driven many initiatives (Telefonica OpenMANO) and acquisitions (Ciena acquired Cyan, for example) and remains the key challenge in 2016 and beyond. SDN NFV will not take off unless there is a programmatic framework to link customer facing services to internal services, to functions, to virtual resources to hardware resources in a multi-vendor fashion. I still maintain 2020 as the probable target for this.

In 2016, the new bit of technology I will investigate is Mobile Edge Computing, the capacity to deploy COTS in the radio network, unlocking virtualized services to be positioned at the network's edge, enabling IoT, automotive, Augmented Reality or Virtual Reality services that require minimal latency to access content even faster.

In conclusion, 2016 shows more than ever signs that the house of cards is about to collapse. Data traffic is increasing fast, video is now dominating every networks and it is just starting. With 4K and then 8k around the corner, without talking about virtual or augmented reality, many of the players in the value chain understand that video is going the next few years' battlefield in mobile, OTT and cloud services. This is why we are seeing so much concentration and pivot strategies in the field. 
What is new is the fact that if mobile was an ongoing concern or barely on the radar for many so-called OTT, it has now emerged as the predominant if not exclusive market segment in revenue. 
This means that more pressure will rain on network operators to offer bandwidth and speed. My reports and workshops show that mobile advertising is not growing fast enough in comparison to the subscribers eyeball moving to mobile screens. This is mostly due to the fact that video services in mobile networks are a pretty low quality service, which will get worse as more subscribers transition to LTE. The key to unlock the value chain will be collaboration between operators and OTT and that will only happen if/when a profitable business model and apportioning of costs is worked out.

At last, my prediction about selfie kills seem to unfortunately have been fulfilled with selfies now killing more people than shark attacks. Inevitably, we have to conclude that in 2016, commercial drones and hoverboards will kill more people than selfies...

That's all folks, see you at MWC next month.

Bytemobile: what's next?

Following the brutal announcement of Bytemobile's product line discontinuation by Citrix, things are starting to get a little clearer in term of what the potential next steps could be for their customers.

Citrix was market leader in terms of number of deployments and revenue in the video optimization market when it decided to kill this product offering due to internal strategic realignment. The news left many customers confused as to what - if any- support they can expect from the company.

Citrix' first order of action over the last month has been to meet with every major account to reassure them that the transition will follow a plan. What transpires at this point in time is that a few features from ByteMobile T-3100 product family will be migrated to NetScaler probably towards the end of 2016. Citrix is still in the process of circling the wagons at this stage and seems to be trying to evaluate the business case for the transition, which will condition the amount of feature and the capacity to reach feature parity.

In many cases, network operators who have deployed versions of ByteMobile T-3100 have been put on notice to upgrade to the latest version, as older versions will see end of support notices going out next year.

Concurrently, presumably, Citrix won't be able to confirm NetScaler's detailed roadmap and transition plan until they have a better idea in term of the number and type of customers that will elect to migrate.

In the meantime, ByteMobile's historical competitors are drawing battle plans to take advantage of this opportunity. A forklift upgrade is never an easy task to negotiate and, no doubt, there will be much pencil sharpening in the new year in core networks procurement departments.

Video optimization market has dramatically changed over the last year. The growth in encrypted traffic, the uncertainty surrounding Citrix and the net neutrality debate has change the feature set operators have been looking for.
Real-time transcoding orders have severely reduced because of costs and encryption, while TCP optimization, encrypted traffic analytics, video advertising and adaptive bit rate management are gaining increasing favors.

The recent T-Mobile USA "Binge On" offering, providing managed video for premium services is also closely followed by many network operators and will in all likeliness create more interest for video management collaboration solutions.

As usual, this and more in my report on video monetization.

Video Monetization 2015 report and market shares released

Live from Las Vegas, where I am at NAB, for the week, the mobile video monetization and optimization 2015 report is now released. You can find the updated description and executive summary there, as usual, table of contents and terms are available upon request, do not hesitate to contact me (patrick.lopez@coreanalysis.ca).

As usual, I provide market share calculations in term of deployment per vendor, the unit being one operator / country. For instance, Verizon Wireless counts for one deployment, even though the operator might deploy 40+ data centres. Groups such as Vodafone, Deutsche Telekom or Telefonica count for each of the properties where the technology is deployed.

For this 2015 edition, we have seen quite a lot of changes year on year and an acceleration from the trends highlighted in last update, ranging from the continuing growth of mobile data and video traffic, complicated by the increasing encryption and privacy concerns. 

Emerging markets and MVNO with smaller volumes fuel the growth with lower price points and tier 1 replacements are slowing down due to regulatory uncertainty. It is hard to predict how long this is going to last, but I am betting on a protracted battle and operators slowly having to take investment decisions despite uncertainty because their network is under too much pressure. TCP optimization, caching, throttling will continue to lead engagements in countries under strong regulatory mandate or uncertainty, while transcoding, DBRA and other lossy technologies will continue to lead in emerging and weak regulatory environments.

The mobile video monetization and optimization market segment researched in this report is composed of 8 primary vendors.

2015 has seen a great change in market shares, as indicated in the previous reports and throughout my quarterly updates. You can find the fall's market shares here, if you want to track the vendors' progression.

1. Citrix keeps its historical market leader spot, with a slight progression to 32%. 
2. Flash Networks had lost the number 1 spot last update and is maintaining itself at 31%. 
3. Openwave is solidly in third place, growing to 13%.
4. Fourth place is now claimed by Allot, with the fastest progression this update to 7%, 
5. Vantrix is in a slight decline at 6%. 
6. Nokia declines to 5% and has decided to resell Flash networks going forward. 
7. Opera has declined to 4%. 
8. Avvasi closes the market share with a growth to 2%.

The market share calculations are based on a proprietary {Core Analysis} database, collecting data such as vendors, re-sellers, value of the deployment in term of total cost of ownership for the operator, operator name, country, region and number of mobile broadband subscribers. These data are cross-referenced from vendors' and operators' individual disclosures. This database also includes over 130 opportunities in video optimization that are at different stage of maturity (internal evaluation, vendor trial, RFI, RFx...) and will close over the next 18 months.

To understand the vendors' trajectory, velocity and strategy better, contact me.

Video monetization and optimization 2014 market share update

As it is now customary, I am releasing today an end of year market share update for video monetization and optimization deployments. You can find here the market shares released in the spring if you want to compare the vendors' progression.

As usual, I provide market share calculations in term of deployment per vendor, the unit being one operator / country. For instance, Verizon Wireless counts for one deployment, even though the operator might deploy 40+ data centres. Groups such as Vodafone, Deutsche Telekom or Telefonica count for each of the properties where the technology is deployed.


This update is characterized by an acceleration of adoption and deployment of the technology in emerging and growth markets, together with replacements either on a per property or group-wide for tier one mature market groups. New categories of deployments, from MVNO to interconnect providers are also making their appearance, while some operators are also turning off the capability.

Large telecom equipment manufacturers have mostly abandoned their in-house projects and are relying on the vendors in this segment for video management, as illustrated by recent partnerships (Skyfire/Huawei, Flash Networks/Nokia, Openwave/Cisco...others unannounced).

Market shares

1. Citrix
   Citrix’ market share is 31%. The company has grown with the market in the period. Citrix regains the market leadership in deployment with this update.
2. Flash Networks
   Flash Network’s market share is 30% . The company has lost market share since the last update, and is sliding in second position.
3. Openwave Mobility
   Openwave Mobility's market share is 12%. The company has grown the fastest of all vendors since the last update.
4. Nokia, Opera & Vantrix
   Nokia, Opera and Vantrix market share are 6% each. Nokia has grown, Opera remains stable and Vantrix decreased market share since the last update.
5. Others
   Allot, Avvasi, Venturi, (in alphabetical order) share the remaining 9%.

The market share calculations are based on a proprietary {Core Analysis} database, collecting data such as vendors, resellers, value of the deployment in term of total cost of ownership for the operator, operator name, country and region. These data are cross-referenced from vendors' and operators' individual disclosures. This database also includes over 130 opportunities in video optimization that are at different stage of maturity (internal evaluation, vendor trial, RFI, RFx...) and will close over the next 18 months.

The market share is valid at the time of publishing but change on a weekly basis, as new deals are awarded.

The market shares in term of number of mobile broadband subscribers and revenue is not published here but is available as part of my workshop or retainer service on the video optimization market. The rankings in term of revenue per vendor are quite different from the installed market share, as different price strategies and different geographic markets are considered.

Full analysis, progression and strategy of each vendor is examined together with market dynamics in my report.

Strategies for multiscreen monetization

Pay TV and OTT providers are increasingly difficult to tell apart. Both are engaged in a battle to capture retain our interest. Many multiscreen strategies are being enacted on both sides to secure this $400 billion market.

Cord cutting, cord shaving are becoming familiar risks for MSOs as viewers’ habits change from scheduled to on demand and from linear to binge watching .

MSOs are hesitating between becoming OTT, partnering with them or embracing multiscreen, while OTT are experimenting with new charging models and are trying to secure exclusive rights for original programming.

These strategies and more are being analyzed in my latest white paper, co-written with Booxmedia.

As large OTT providers are helping consumer-viewing habits evolve, there are great opportunities for MSOs and content providers to offer OTT and multiscreen services that will strengthen their brand, expand their reach and grow their customer base.

Cloud TV everywhere emerges as one of the most successful strategies to date for customer acquisition, retention and monetization.  Robust recommendation, content discovery and ad management are keys for monetization of multiscreen.

Impact of Iliad's purchase of T-Mobile

Last month, I was musing about a world where wireless voice and messaging ARPU would be 0$.

While many are discovering the bid by Iliad to take over T-Mobile US, I have been following the company for nearly two years in its successful market introduction in France.

I thought it would be interesting to have a look at what has been the impact to date of Iliad on the French mobile market as a reference point.


Iliad launched a mobile service in France in January 2012 under the brand free Mobile. The offer was simple and a perfect disruption to the highly-regulated market. Building on their broadband payTV set top box offer, Iliad secured 3G and 4G licenses from the french regulator and started offering for free mobile services to their payTV customers.

The offering

Shortly thereafter, the company launched a disruptive offer: 19.99 euros per month for unlimited national (all) and international (fixed line) voice calls , unlimited text and picture messages in europe, 3GB of data in 3G and 20GB in 4G.
To accelerate their customer acquisition for the moderate users, the group launched in 2013 a no contract 2 euro per month deal for 2 hours national and international voice calls, unlimited text and picture messages in europe, and 50MB of data.

The results

This disruption was a commercial and popular success for the company but a disaster for the incumbents. 
Dominated by Orange, followed by SFR and Bouygues, the market was deeply disturbed by this introduction.

In two years, here is the impact of Iliad on the french market:

• Iliad as of March 2014 counted 8.6 million subscribers representing 13% market share and generating 1.2 billion euros of revenue.
• Iliad in 2014 covers 50% of the french population in 4G and 75% in 3G.
• Iliad's network quality has been rated worse of all French operators but the company ranks first in customer satisfaction.
• Average turnover by mobile operators decreased by 11% in 2012 and 13% in 2013 and net income by 20%
• Average Revenue Per User (ARPU) has decreased by 22% 
• Collectively, operators increased their CAPEX investments to 7.3 billion euros in 2013 (excluding licenses).
• Collective free cash flow has decreased by 40%

Conclusions

Of course, it would be difficult to draw a direct parallel between the successful introduction strategy of Iliad in France and what would happen if they purchased T-Mobile in the US. Nonetheless, Iliad is probably the company that has acquired the most customers in the shortest amount of time of all wireless operators globally, while focusing on what matters most: customer satisfaction. Of course a disruptive pricing strategy was the main vehicle for introduction, but ease of use, with no-contract offers, unlocked phones packaged or not with subscription were a large part of the company success as well. 

The lessons to draw here are that network operators need to prepare for a world where ARPU can drastically reduce while structural investments increase. Flexibility, elasticity but more importantly a customer centric approach will make the difference.

The themes are further addressed and analysed in my latest report to be released in September: SDN / NFV in wireless networks.

Video monetization and optimization market shares 2014

For those of you, loyal readers who have followed this report, now in its third edition, there will be no surprise as to why monetization is making its appearance in the title and figures so prominently in the analysis and opinions voiced there.

Mobile video optimization was a solution brought forward by web optimization, browsing gateway and mobile video vendors that was positioned as a means to drastically reduce the volume of video transiting through a mobile network. With a combination of lossless (caching, pacing…) techniques aimed first at reducing the inherent waste of delivering videos created for the internet and laptops in a mobile network, the solution evolved towards aggressively reducing video volume through lossy (transcoding, transrating) techniques.

Vendors in this space have evolved their offering from a broad, binary application of the technology, essentially proxying and optimizing all video traffic all the time to a more granular, targeted implementation that performs optimization to portion of the traffic, at specific points in time in specific locations, driven by policy engines or relying on network congestion detection, either on explicit indication from the RAN or interpolation relying on the state of the TCP traffic. Most vendors are also now launching customer engagement tools, sophisticated analytics or new video charging capabilities to enable early monetization plays.

As usual, I provide market share calculations in term of deployment per vendor, the unit being one operator / country. For instance, Verizon Wireless counts for one deployment, even though the operator might deploy 40+ data centres. Groups such as Vodafone, Deutsche Telekom or Telefonica count for each of the properties where the technology is deployed.

Market shares

1. Flash Networks
   Flash Network’s market share is 40% . It is the market share leader and has grown faster than the market since the last update, through organic growth and acquisition of Mobixell Networks.
2. Citrix
   Citrix’ market share is 30%. The company has grown faster than the market  since the last update.
3. Openwave Mobility
   Openwave Mobility's market share is 8%. The company has grown faster than the market since the last update.
4. Venturi Wireless
   Venturi Wireless markets is 8%. The company has lost market shares since the last update.
5. Others
   Allot, Avvasi, NSN, Opera, Vantrix (in alphabetical order) share the remaining 14%.

The market share calculations are based on a proprietary {Core Analysis} database, collecting data such as vendors, resellers, value of the deployment in term of total cost of ownership for the operator, operator name, country and region. These data are cross-referenced from vendors' and operators' individual disclosures. This database also includes over 130 opportunities in video optimization that are at different stage of maturity (internal evaluation, vendor trial, RFI, RFx...) and will close over the next 18 months.

The market share is valid at the time of publishing but change on a weekly basis, as new deals are awarded.

The market share in term of revenue is not published here but is available as part of my workshop on the video optimization market. The rankings in term of revenue per vendor are quite different from the installed market share, as different price strategies and different geographic markets are considered.

Video optimization mid-term update

As it is now traditional (here, here and here) , I update my video optimization market report mid-way from its release post mobile world congress.
This update sees many changes, including Cisco's new strategy in the space, together with company and product plans from Citrix ByteMobile, Allot, Flash Networks, Mobixell, Openwave Mobility, Opera Skyfire and many others.

Operator trends

The market trend for the segment reaffirms its maturity. Like last year, the summer has been quiet in term of activity while spring and the fall remain the high RFx quarters. We have recently seen two large groups select their vendor in the space (Telenor and Orange), more or less wrapping up the tier one group selection process for this cycle in mature markets. Growth in this segment now comes from Latin America and South East Asia, where many groups (Singtel, America Movil, ...) have yet to formulate / finalize a strategy in the space. As discussed in a recent post, coming back from LTE Asia, I have been able to experience first-hand both the interest and the confusion on how to manage efficiently OTT video in some of these markets.

Vendor trends

Citrix ByteMobile remains market leader, both in deployments and revenue. The deployment relative market share is decreasing slightly to 29%, while revenue market share is increasing. This is the result of the fact that new low-cost vendors are entering the market and tier 2 / 3 customers are buying solutions, depressing the average sale price, while increasing the volume of transactions.

Mobixell Networks remains number 2 in deployments with 23%, once again growing its market share over the period. The company's geographical growth comes from APAC and LatAm.

Flash Networks remains a strong third with 17%, growing as well faster than the market. The company is focusing on profitable growth in mature markets with large tier 1 groups.

While the vendors and their order remain unchanged at the top, the new entrants in the market are exceeding expectations, with good progress from Opera Skyfire and Avvasi for instance, while the mid-segment vendors are seeing their market shares and margin deteriorate.
For more information or to order my report, please contact me.

As usual, I provide market share calculations in term of deployment per vendor, the unit being one operator / country. For instance, Verizon Wireless counts for one deployment, even though the operator might deploy 40+ data centers. Groups such as Vodafone, Deutsche Telekom or Telefonica count for each of the properties where the technology is deployed.

The market share calculations are based on a proprietary {Core Analysis} database, collecting data such as vendors, resellers, value of the deployment in term of total cost of ownership for the operator, operator name, country and region. These data are cross-referenced from vendors' and operators' individual disclosures. This database also includes over 100 opportunities in video optimization that are at different stage of maturity (internal evaluation, vendor trial, RFI, RFx...) and will close over the next 18 months.
The market share is valid at the time of publishing but change on a weekly basis, as new deals are awarded.