How telecoms can monetize from video biz?


Telecoms are betting big on video business. But generation of income from video business is becoming a major challenge for telecoms.

The following facts will support the interest of telecom operators to spend in video.

LG UPlus CEO Sangchul Lee said — at the Mobile World Congress 2015 Shanghai – that video will be the new voice.

China Mobile says its mobile data traffic increased 115.1 percent to 1.1329 trillion megabytes in 2014. In the first half of 2015, China Mobile’s Web browsing business among its 200 million 4G users increased 2.6 times year-on-year and video services rose 4.6 times.

Idea Cellular Managing Director Himanshu Kapania said – at the Mobile World Congress 2015 Shanghai – that smartphones accounted for 69 percent of India’s Internet traffic against 30 percent in China and 57 percent in Indonesia. Idea Cellular has nearly 17 million 3G subscribers and the total number of mobile data users is 37 million. For comparison, China Mobile has 222 3G users.

How to generate money from video?

Huawei has recommended five success factors for monetizing from video services.

# Establish a viable business model: Evolve the business model from value filling and long-tail services to a bilateral revenue model.

# Acquire content: Operators can adapt the content acquisition model to different user bases.

# Build network architecture that delivers the best video experience: At different development stages, users have different requirements for video services, which place different requirements on network capacities.

# Transform operations: Prioritize efficiency and complete service rollout, marketing, and operations transformation by benchmarking OTT players.

# Aggregate and enable access: Build a content aggregation platform to bring together Internet content providers (ICPs) and manage the portal. Integrate multiple platforms and open up capabilities.

Zou Zhilei, president of Huawei’s Carrier BG, said: “The era of video everywhere has arrived, and it will fundamentally change the way we consume information. Video includes real-time communication videos for individuals and videos applied in security defense, city surveillance, and other industries.”

Cisco says more than 14 percent of monthly global IP traffic will come from cellular connections and 53 percent of monthly IP traffic will come from Wi-Fi connections by 2019. Differentiated and monetizable mobile strategies will be important for all SPs.
OTT video
Cisco says IP networks must be intelligent and flexible enough to support the constant introduction of new/updated applications for fixed and mobile networks.

“It took 32 years — from 1984 to 2016 — to generate the first zettabyte of IP traffic annually. As this year’s Visual Networking Index forecasts, it will take three additional years to reach the next zettabyte milestone when there will be more than 2 zettabytes of IP Traffic annually by 2019,” said Doug Webster, vice president of Service Provider Products and Solutions Marketing, Cisco.

By 2019, global mobile data traffic will be 291.8 exabytes annually and will grow 10X from 2014 to 2019. In 2014, mobile data traffic represented 4 percent of monthly total global IP traffic. By 2019, mobile data traffic will represent nearly 14 percent of monthly total global IP traffic.

On the other hand, Internet video traffic will grow 4-fold from 2014 to 2019. Internet video traffic will reach 105 exabytes per month by 2019 against 25 exabytes per month in 2014. Internet video traffic (business and consumer) will be 77 percent of all Internet traffic in 2019 against 59 percent in 2014.

Consumer Internet video traffic will be 80 percent of consumer Internet traffic by 2019 against 64 percent in 2014. Business Internet video traffic will be 65 percent of business Internet traffic by 2019 against 38 percent in 2014.

Zou of Huawei said that video will connect tens of billions of devices and billions of people, creating a huge market worth $1 trillion for the ICT industry.

Huawei said video will become a new basic service as approximately 85 percent of data traffic will be generated by videos.

Video challenges

At present, market opportunities are fragmented and only cater to individual needs. There are no uniform standards on video technologies and customer experience standards in place.

To address video related challenges, Huawei will build networks that deliver the best video experience, for example, 4K@FBB and 2K@MBB networks.

In addition to researching video service standardization, Huawei also works with other industry players to establish and apply uniform standards in areas such as video coding, transmission, and computing.

Huawei will also work with more industry partners to create a sound video ecosystem, and stands ready to cooperate with customers and industry partners to enter a new age of video.

Baburajan K
[email protected]