Could Video Kill The (Wireless) Radio Star?

As wireline and wireless services blur and converge, countless consumer and enterprise customers are evaluating the impact. Traditional cable companies are losing subscribers in droves with cord cutting in lieu of mobile consumption flexibility. The result is a fundamental shift in economics and consolidation across multiple industries including content / media, cable and wireless service providers that were once siloed.

(Source: Will Townsend, Moor Insights & Strategy)

As a Generation Xer, I vividly remember watching “Video Killed the Radio Star”, the first music video that debuted on MTV August 1st, 1981. I recently watched it again and was surprised by the first refrain of the song: “I heard you on the wireless back in fifty-two”. I find those opening lyrics ironic, as I’ve recently pondered the impacts of telco convergence and the resulting increase of video consumption on wireless networks.

Dumb pipes are dead

As defined by Wikipedia, “dumb pipes” refer to a network that is simply used to transfer bytes of data between a customer’s device and the internet while being completely neutral to the services and applications a customer utilizes. Access is rapidly becoming a commodity with all you can eat data plans on the rise, competitive pricing and network coverage / performance parity. Subsequently, original and syndicated content delivery as well as a “no buffer” video experience is expected as the new normal on tablets and smartphones connected to mobile broadband networks.

Referred to commonly as OTT or “over the top”, the delivery of audio, video and other media transmitted via the internet bypassing cable or direct-broadcast satellite television systems is growing by leaps and bounds. On the consumer front, video and streaming content delivery is being well executed by AT&T  given its acquisitions and leverage of DirecTV and soon Time Warner as well as Sprint with their investment in Tidal. Former US carrier leader Verizon Wireless seems to be lagging rivals in OTT execution as evidenced by recent poor financials, high subscriber churn and recent rumors around acquiring Disney. However, can quality of experience keep up with the growth of these services?
Quality of service will become the new carrier differentiator

If I’m the CEO of a carrier solution provider, OTT quality of service would keep me up at night. I recently spoke to Cisco Systems and learned about its “Mobile First” framework that is focused on proactive data provisioning based on specific devices on the network. Cisco’s technology also employs big data analytics to plan for both anticipated and spike demand. By using predictive analytics, virtualization techniques and deploying compute at the edge of a network, bandwidth can be intelligently allocated and not wasted. The result is a proactive improvement in network performance vs what is often deployed reactively when performance wanes. Cisco believes that mobile video traffic will grow to 75% of total global mobile data traffic by 2020, and I wholeheartedly agree with that prediction. Given that statistic, it’s encouraging to see a proactive approach to improving the video consumption experience.

Amazon is also in the video optimization game with its AWS Elemental platform. The cloud-based video infrastructure allows carrier solution providers to tailor levels of scalability, personalization and security to user demands. The result is new monetization opportunities for operators and lower overall implementation cost, but most importantly an improved video viewing experience.
Video has the potential to kill wireless network performance and scalability without proper planning. It’s clear to me that all the talk around “digital telco transformation” isn’t simply lip service, it will define which carriers rise to the top. It will be interesting to see what unfolds to ensure that we all have a great video and audio streaming experience on our connected devices. After all, I want my MTV and HBO Go on-the-go without the confines of Wi-Fi!