Tuesday, December 6, 2016

If the Future of Video is Mobile," Much Will Have to Change

“The future of video is mobile And the future of mobile is video,” said Tom Keathley, AT&T SVP, releasing news about AT&T’s 5G tests in Austin, Texas. That assertion might  be true at multiple levels, beyond the observation that video already drives capacity demand on mobile networks.

In fact, it always has been clear that on-demand video would “break” the economics of a traditional video service, when the mobile network charges for data usage. The reason is simply that traditional video services do not charge for use of networks (the cost of the network is part of the content subscription). In other words, media business models always were based on zero rating.  

So long as mobile networks charge both for content and access, consumption of video will face hurdles, and consumption of next-generation versions of linear video services will face impossibly-high barriers. By about 2022, video will drive 75 percent of all mobile usage, some predict.  

At least in the medium term, video is the biggest new revenue source in the mobile business. Already, peak hour data demand is driven by entertainment video, which represents about half of all demand at peak hours of use.

Ultimately, mobile likely will change the way subscription video applications are regulated when carried on mobile networks. The analogies are mobile voice and messaging, where consumers pay for use of those features, but not the underlying bandwidth to support the usage.

Up to this point, that has not been the way subscription video services are charged, on fixed or mobile networks. Until now, consumers paid both for consumed data and the content subscription.

That actually is a barrier to widespread adoption of mobile subscription video, as significantly higher data charges would be an inevitable result.

The T-Mobile US “Binge On” program, which allows customers to view nearly all video without incurring data usage charges, was the first effort to encourage a new model by exempting usage charges for bandwidth-intensive video apps.

AT&T’s DirecTV Now is the next-generation replacement for linear DirecTV. But DirecTV has a different business model from over the top apps, in one key sense. DirecTV, and cable TV or telco TV, is a managed service, bundling an access network for delivery and quality of service mechanisms, with the actual “product” being the content, not the use of the network.

Traditionally, satellite TV and cable TV have been regulated differently than telco access networks, on a modified broadcast TV basis. Telco access networks have been regulated as common carrier utilities, although for most of its existence, internet access was not regulated as a common carrier service (that changed under the Obama administration, but is subject to change).

As virtually all media types now can be delivered over an IP infrastructure (public or private), the big problem to be addressed is how to modernize and rationalize regulation of all the various apps and services, which have ranged from unregulated (print media) to somewhat regulated (broadcast TV and radio; cable TV apps and access) to common carrier (telcos and cable, to a certain extent).

When every media type can use one physical infrastructure, different sets of regulatory frameworks--treating different providers in different ways; or the same apps in different ways based on which physical infrastructure is used--will make little sense. Zero rating is allowed for newspapers and magazines, broadcast TV and radio, cable TV and other linear distribution services, but not for IP network delivery, even when it is the same content.

No comments:

"Tokens" are the New "FLOPS," "MIPS" or "Gbps"

Modern computing has some virtually-universal reference metrics. For Gemini 1.5 and other large language models, tokens are a basic measure...