June 12, 2020
OTT video has exploded. We have had a glimpse of the future when OTT will be THE mainstream (no pun intended!) Numerous recent reports have reflected the impact. If you missed them…
Limelight: 30% year-on-year increase in total traffic levels, due to video streaming increases. Q1 revenues up 37% to a record high. A sizeable shift in total demand throughout the day.
Akamai: Q1 2020 traffic peak was 2x the peak in Q1 2019. Without live sports, total traffic increased by about 30% at the end of Q1. Net income was up 15%, better than expected.
Conviva:Global streaming up 57% from March 2019 to March, with Europe up by 70%. On-Demand viewing increased by 79% year-on-year and represented 72% of the global total.
Openvault: Global broadband usage accelerated by one year. Average usage in March at the level expected in December. Exponential increase in the number of >1TB per month “power-users”.
These Quarterly results were based on a 2-4 week lockdown period in most countries during March. What the situation will be in Q2 reports after a longer lock-down period will be very interesting!
Based on knowledge from current deployments, and observations of the industry over recent months, I have made a few observations:
- Content needs to be streamable on-demand – if not, you’re losing your audience
- OTT delivery costs via CDN service providers are on a big upward curve, eroding OTT margins
- Live content will put even more pressure on network capacity, and quality will be impacted
- Sustained high-scale VOD delivery needs high-performance central storage and origin systems
At Vecima, we see a future where OTT will be at true scale for the whole Media & Entertainment industry. Not just the super-streamers like Netflix and Facebook, or global players like Apple TV and Disney, but for all of the national Broadcasters’ OTT offerings like Peacock, RAIPlay and BBC iPlayer.
It’s not clear when exactly OTT will be the main stream of choice. Each country has its own set of market conditions and regulations. But the consumer-driven pull to OTT is strong, and the Direct to Consumer Content Providers have a clear opportunity. But the challenges above highlight the issues.
So what can you do?
- Change your CDN model – start looking now at what a Private CDN offers you. It’s what Netflix and Facebook did years ago. They did it for good reason. To reduce costs, control quality, avoid internet congestion, and have a direct relationship with the in-country ISPs. And it’s not rocket-science. It just needs a new approach using proven technology.
- Deploy scale-ready streaming storage – large VOD libraries need high-performance, cost-effective storage. It’s pretty unique to video. And it’s not easy. If the storage goes down, the service suffers.
Vecima has over 20 years of expertise in streaming and storage products. We know how to solve these challenges as we’ve already done it for our customers. OTT at scale needs high-performance, scalable, and cost-effective technology that allows you to control your customer’s experience. It’s do-able, but it needs a new perspective.