Are we in the best of times or the bad times in the video business? Mark Donnigan VP Marketing at Beamr




Get the original LinkedIn article here: The Best of Times & Worst of Times in the Video Business

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Mark Donnigan is VP Marketing at Beamr, a high-performance video encoding innovation company.

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Are we in the good times or the worst of times in the video business? Mark Donnigan Marketing Leader at Beamr

Can a four character technology save us?
This is a fascinating concern due to the fact that there is a paradox emerging in the video organisation where it seems like the the finest of times for lots of, however the worst of times for some.
Here we have Disney revealing that they have actually currently accumulated one billion dollars in loses, and this even prior to releasing their direct to customer service. And after that 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 cable cutting numbers have not grown, which puts increasing pressure on the video side of the provider service.

Yet, Netflix stock is on the increase again, allowing the business to buy material 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 quite important.

5G is going to conserve us all?
This is where I wish to get in touch 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 very same time make others.

Let's look at AT&T.

In the last 4 years AT&T has included 80 billion dollars of additional financial obligation leaving it with more than 160 billion dollars of short and long term financial obligation. Now, 50 billion of this incredible number was the outcome of the 2015 purchase of DirecTV.

My point is not to break down the AT&T financial obligation numbers, I'm not an analyst, however rather offer a viewpoint 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 very various with video.

What can a service supplier like AT&T do to resolve the economic squeeze, and the total headwinds to the video business? Such as declining pay TELEVISION subs, and fragmenting OTT service offerings. This is the concern on many minds who are evaluating the future of the video organisation.

It is my strong belief that ubiquitous high speed mobile networks powered by 5G will unleash a video tsunami of traffic on the network like we've never ever seen before.
This will be great news for the PlutoTV's of the world and other ingenious video services like Quibi who will be able to reach more consumers with a better quality experience as an outcome of having the ability to utilize a faster network thanks to 5G.

It's bad news for network operators without a plan to monetize this additional traffic load, and of course incumbents who are hoping to get by with incremental improvements to their services; such as switching from handled to unmanaged, or OTT circulation, while continuing to utilize aging video requirements like H. 264 to provide low resolution mobile profiles.

Video suppliers who continue to under serve their consumers will rapidly be at a drawback, and ripe for disruption, I think, from brand-new company models such as AVOD and the newest and most efficient video innovations.
The 4 character video innovation that might save the video company.
The four character video standard that I believe will play a key function in the success of the video business is HEVC, the video codec that is now deployed on two billion gadgets. The following slide discussion offers numbers concerning HEVC gadget penetration which are worth seeing.


There has been much written about HEVC royalty issues, something that set off development of an alternative codec which most likely is royalty free. While some in the market became preoccupied with concerns around licensing and royalties, significant developments have actually been made on the legal front, including almost every CE device manufacturer consisting of HEVC playback support.

HEVC Advance waived all royalties for digital distribution of material. This indicates, HEVC encoded content that is streamed will just carry a royalty for the hardware decoder and this is currently covered by the getting device. Supplied that you are delivering bits over the wire and not by means of a physical mechanism such as Blu-ray Disc, your business will not have to pay any extra royalties, at least not to HEVC Advance.

Now, if it's any convenience, the business who have currently done their due diligence on the royalty question, and are streaming HEVC material to consumers today, include: Amazon, Comcast, DirecTV, Meal Network, Netflix, Sky, Sony, Vudu, Vodafone, and Orange, just to call a few.

What about HEVC playback support?
This is a great and crucial question and possibly the area of development around the HEVC environment that is least known or comprehended.

Beginning with in-home playback, if your users have acquired a TV, game console, Roku box or Apple TELEVISION in the last 3 years, you can be nearly guaranteed that assistance for HEVC is present with no need for additional licensing or gamer upgrade.

HEVC is now resident in almost every SoC that goes in to any mid to high-end CE video device. In fact, considering that 2015, market reports show this group of products numbers 400 million. That's 400 million devices that support HEVC natively. It's a terrific start, however what about mobile?

The information company ScientiaMobile preserves the biggest dataset of network gadget gain access to profiles by getting data from the largest 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 motivating with 57% of Android smart device demands originating from gadgets that support HEVC decoding.

And provided the HEVC gadget penetration and hardware support any worries about a premature move to HEVC are not warranted. What other aspects confirm the concept that HEVC will be a booster to the video service?

LiveU just recently released a report called 'State of Live' that showed growing trends in HEVC broadcasting, particularly in the world of sports. And just in case you have thoughts that the use of HEVC is a passing trend en route to some alternative codec, consider that in 2018, 25% of all LiveU produced traffic was streamed utilizing the HEVC video standard while the only other codec used was H. 264.

In fact, the report stated that the high HEVC usage was a direct reflection on the increasing need for professional-grade video quality, a pattern that was plainly evident Learn more now at the 2018 FIFA World Cup in Russia.

So what does this mean for the market?
The patterns we just took a look at reveal that we have an ever more demanding consumer who desires content that flaunts the complete abilities of their viewing gadget, which suggests higher resolutions and more sophisticated video standards like HDR. This very same user is now taking in more material, which contributes to additional crowding the network.

This consumer consumption pattern is colliding with a shift from managed services to unmanaged, or OTT circulation and developing technical stress inside incumbent service operators who are dealing with technical shifts and company model fracturing. Remarkably, in spite of a very clear threat to the incumbent services who are seeing video subscriber loses installing into the hundreds of thousands over simply a few brief quarters, some are continuing with the status quo even while new entrants are launching services that offer the customer 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 an innovation enabler. It's a video requirement that is set to interrupt much of the conventional operators and early OTT streaming services. Not because the consumer knows the difference between H. 264, VP9, or perhaps HEVC, but due to the fact that the consumer is ending up being mindful that much better quality is possible, and as they do, they will migrate to the service who delivers the best quality cost effectively.

At Beamr, our company believe that the proof of our item and technology excellence should be knowledgeable and not simply talked about. Which is why we have actually created the finest deal that we have seen in the industry where you can utilize our codecs in combination with our VOD transcoder, 100% for complimentary.


HEVC is now resident in practically every SoC that goes in to any mid to high-end CE video gadget. These two numbers are where the photo of HEVC as the most rational video standard to follow H. 264, begins to take shape. Here we have major video distributors and tech companies currently encoding and dispersing material in HEVC. And given the HEVC device penetration and hardware support any concerns about an early relocation to HEVC are not called for. What other aspects confirm the idea that HEVC will be a booster to the video service?


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You can try Beamr's software video encoders today and get up to 100 hours of free HEVC and H. 264 video transcoding on a monthly basis. CLICK HERE

Originally published by: Mark Donnigan

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