Home Analysis Why it is crucial that mobile operators get video right

Why it is crucial that mobile operators get video right

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The latest edition of the Ericsson Mobility Report, published last month, revealed that video data traffic is growing by 60% per year, driven by better network speeds, and is forecast to account for around half of all mobile data traffic by 2018. It confirms why the company is focusing so strongly on the optimization of video delivery in this space, as witnessed by its new LTE Broadcast solution, which enables content streams to dynamically switch from unicast to multicast according to their popularity, including in real-time and without any service disruption. This solution won an ‘Outstanding Technology Innovation’ award at this year’sConnected TV Awards.

The Ericsson Mobility Report also made clear the opportunity for mobile operators who can deliver the best experiences for consumers. Network performance is the principal driver of subscriber loyalty to mobile operators, followed by value for money. It adds: “These two parameters are correlated, implying that improving network quality will also improve perceived value for money at a given price level.”

Addressing network performance has twice the impact on customer loyalty as measures to improve customer support and is four times as effective as introducing loyalty rewards. It is twice as important as tariff plans. Network performance is also the key factor that determines whether customers are ‘promoters’ or ‘detractors’ of the brand when it comes to recommendations. The Ericsson analysis shows that up to 67% of promoters are very satisfied with network performance, compared to only 5% of detractors.

Attractive handsets, though promoted to customers, mostly generate positive perception for the device brand, according to the Ericsson analysis. And an analysis of brand perception (based on one developed market but said to apply globally) reveals that consumers rank operators lower than OS providers, content providers and the handset manufacturers. In the developed market covered by the report, two Operating Systems, one handset manufacturer and four content providers all have better brand perception than the best perceived operator brand.

With this as the backdrop, Ericsson launched its LTE Broadcast solution earlier this year. As we reported previously, this enables multicast over LTE and dynamic switching between multicast and unicast, meaning the bandwidth efficiencies of one-to-many streams can be used when demand for content is great. That will mean better QoE (Quality of Experience) for video services where there is bandwidth contention in mobile cells and it also preserves bandwidth for other key services, whether these are phone calls and texts to social networking. Ericsson LTE Broadcast does not need any changes to the physical network; the radio spectrum is untouched.

Ericsson predicts that LTE services will be available to about 60% of the world’s population in 2018. It expects LTE subscriptions to exceed 1 billion in 2017, driven by more capable devices and demand for video and other data-intensive services.

Ericsson is also tackling the mobile video challenge with its Media Delivery Network (MDN), which is a new approach to the operator CDN that caters for both mobile and fixed networks through the same platform. This includes a management layer, a caching layer and a service exposure layer. Among other things, Ericsson has been working on the best places to cache mobile traffic, which could mean as close to the radio towers as possible.

MDN can make use of existing Ericsson mobile products like Ericsson Multiservice Proxy, which provides web, video and protocol optimization capabilities for mobile browsing and streaming. This product includes advanced caching technology and enforces policy management.

MDN, especially in combination with broadcast LTE, helps to manage the increasing demands for video over mobile networks but this is not just about avoiding a capacity crunch. There is an opportunity for mobile operators to generate new revenues too. In the same way that fixed broadband operators can partner with content owners and give them the QoS guarantees they need to charge for content or attract advertisers to broadband video services, so the mobile operators can give content owners similar assurances.

Recognizing the way consumer behaviour is changing in the smartphone age, the Ericsson Mobility Report now talks about app coverage, which broadens the definition of coverage from one that has traditionally focused on voice or talked in terms of 3G reach, rather than set benchmarks for the user experiences people are looking for. According to Ericsson, “App coverage is the proportion of a network’s coverage that has sufficient performance to run a particular app at an acceptable quality level.” It will therefore vary by app.

Ericsson suggests that as app coverage is based on user experience, all things that affect network performance ultimately must be taken into consideration. This includes backhaul capacity from the radio base stations as well as the packet core and Content Delivery Networks. Not surprisingly, video apps have some of the most exacting demands.


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