Cloud-Pipe-Device

Cloud-Pipe-Device
Strategic Transformation
Cloud-Pipe-Device: Integration for success
Cloud-Pipe-Device
Integration for success
As content distributors, MSOs are facing challenges such as new competitors, scarce bandwidth,
and changing distribution models. They need a new approach to retain their market dominance.
By Zhang Feilong & Fan Cunzhi
A
s repor ted by the London-based
Financial Times, traditional payTV subscription rates in the U.S. are
dropping as tech-savvy consumers
increasingly choose to watch alternatives such as
over-the-top (OTT) content. Chief among these
rival providers is Netflix.
The number of Netflix subscribers is soaring.
In July 2011, Netflix’s global subscriber numbers
reached 25.60 million, including 1.96 million
new additions, while it recorded a revenue of
USD828.5 million for the second financial
quarter.
Netflix has overtaken Comcast and Time
Warner to become the video service operator with
the largest number of paying subscribers in North
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NOV 2011 . ISSUE 62
America. This is putting unprecedented pressure
on multiple system operators (MSOs) to expand
and/or diversify their lineups.
Telecom operators are also refining their IPTV
offerings; AT&T’s live HD channel not only
reduces the channel switch delay to less than one
second, but also provides rich online content that
easily competes with MSO offerings, which often
seem a little behind the curve.
MSOs must seek ways to stay competitive and
continue their market dominance in the content
distribution field. They can exploit the integration
of the cloud, pipe, and device, and provide massive
and diverse video content, better QE, higher-speed
bandwidth, and smarter equipment, both in the
home and on the go.
Huawei Communicate
Cloud
The Internet is not restricted by time or space.
Nearly all commercial TV programs and movies are
available online, as are amateur videos of a respectable
quality. MSOs can certainly make their lineups
more rounded by supplementing their premium pay
content with Internet video. Traditional video services
that have moved online are thriving. The China
Central Television (CCTV) International Channel,
which has always been broadcast by satellite, is now
also available online. This channel, once an obscure
offering often viewed by hotel room occupants in
lieu of CNN, has become hugely popular, with
dramatically increased ad revenue.
Another new opportunity for MSOs may lie in
cloud gaming, where users no longer need to use a
high-end PC or game console, or even buy software,
in order to enjoy the latest and greatest games. The
platform converts game images and voices into
videos and sends the encoded video stream to the
STB. Upon receiving user operation messages, the
STB sends them back to the platform. OnLive, for
instance, provides some of the latest cloud games and
enables play on a TV set, all without a video card.
The cloud can also provide storage services that
enable users to store videos and pictures to the data
center through the STB. Meanwhile, by using a
cloud desktop, users can work at home, and enjoy
personal applications such as bank transfer and
payment service.
NOV 2011 . ISSUE 62
10
Strategic Transformation
Cloud-Pipe-Device: Integration for success
Some of the most popular
video websites now
provide application
programming interfaces
(APIs) that were once
available only on the likes
of Facebook and Twitter.
Viewers can rate
and comment on content,
exchange ideas, and watch
recommended videos.
Pipe
Innovative services keep hitting the
market, such as 3D TV, 3D gaming,
home surveillance, home healthcare, and
intelligent home control, all of which
require heavy bandwidth and better service
performance. Cable TV networks in the
U.S. have become digital communications
networks. Triple-play subscribers can send
and receive email, browse websites, make
calls (including voice calls, video calls, and
video conferences), order TV programs,
and watch paid programming. They can
also perform e-commerce activities such
as real-time stock transactions, online
education, and telemedicine. Enterprises
can manage security surveillance, gas
leakage reports, meter reading, etc. All
of these applications require serious
bandwidth.
However, some applications depend
on more than just bandwidth, such
as the aforementioned cloud gaming.
Du r i n g p l a y, u s e r o p e r a t i o n s a re
uploaded to the cloud game platform.
The platform processes game images,
compresses and encodes them into
high- and low bit-rate video streams,
and then transmits them through the
network to the terminal. The terminal
decodes these streams and displays the
images. Online gaming service requires
more from the pipe when compared
with live video service. It requires not
only adequate bandwidth but also a
strict limit on delay, jitter and packet
loss. If the network delay exceeds
80 milliseconds, the game will be
considered unresponsive.
MSOs should not only expand
bandwidth, but also understand the
network requirements of different
services, so that they can better add
value to their networks.
Device
Internet video is here to stay; the
STB is no longer the only choice
for diverse content. Users can now
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NOV 2011 . ISSUE 62
enjoy video through devices such as
tablets, IP-enabled televisions, and
smartphones. Time shifting and wireless
networking enable viewing on these
devices whenever it is convenient.
Some of the most popular video
websites now provide application
programming interfaces (APIs) that
were once available only on the likes of
Facebook and Twitter. Viewers can rate
and comment on content, exchange
ideas, and watch recommended videos.
Smart TV is an emerging trend; it is
a platform that promises interactivity,
connectivity, personalization, and
responsiveness. With smart TV, Internet
surfing will replace channel surfing, and
users will be entirely in control of what
content they view, if they choose to
be. Video content will be HD, at least
in the home; the slightest connection
glitch can be easily noticed on a 40-inch
screen.
In response, MSOs need to provide
devices that not only allow users to
watch videos, but also interact and
innovate. Flexible devices will enable
timely innovation, so that MSOs can
stay on top of what’s cool without the
need to replace hardware. Improved
mobile devices will reduce the need
for STBs, which will help alleviate the
dilemma of home wiring.
High-definition video on IP is
changing the course of Internet
development and having a great impact
on existing network architecture.
New devices, such as the XBox 360
Kinect and the iPad, will probably
spearhead video service innovation.
Moreover, they will accelerate the offline-toonline digital shift of content distribution
and further change the operational model
for fixed network bandwidth.
To consolidate their market position
and create greater value for their
customers, MSOs need to improve
their pipe performance and service
management capability, deliver content
and manage bandwidth more efficiently,
and better integrate the cloud, pipe, and
device.
Editor: Long Ji [email protected]
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