dancing with the ott wolves: monetize the data reality...ott video is habit forming 0% 10% 20% 30% a...
TRANSCRIPT
Dancing with The OTT Wolves:
Monetize the Data Reality
Mark Winther
2014 2015 2016 2017 2018
65.7 73.6 81 86.6 90.8
Canada
2010
Latin America
2011 Australia
New Zealand Japan (Q3)
2015
2013 Netherlands Germany
France Austria Belgium Switzerland Luxembourg
2014 UK
Ireland Finland Denmark Sweden Norway
2012
International expansion expected to be largely complete by YE2016
2016 ROW
The core is really continuing to improve the personalization. Being able to more and more accurately present content on the screen whether that's a TV screen or phone screen. We've seen tremendous benefit as we've done more and more of the big data work.”
Reed Hastings, CEO.
Q2 2015 earnings call
US OTT Video Subscriptions growing 11% CAGR (M)
Source: U.S. Subscription Over-the-Top Video Services Subscriber 2014-2018 Forecast, Sept 2014. IDC#251519
Netflix – Global, Big Data & Growth
OTT video is habit forming
0% 10% 20% 30%
A few minutes
Half an hour
An hour
More than 1 but less …
More than 2 hours
15%
18%
24%
26%
18%
Viewing session length 68% of use is an hour or more
Source: IDC’s 2015 U.S. Consumer Video Survey Base: 2,006 US consumers
0% 10% 20% 30% 40% 50%
Less than once a month
Once a month
Few times a month
Once a week
Few times a week
Every day
5%
1%
10%
8%
41%
35%
Frequency of use 76% use multiple times per week
Multi everything is expected
Multiple Devices Are Used Multiple Services Are Purchased
0% 10% 20% 30% 40% 50% 60%
Four or more
Three
Two
One
7%
9%
31%
53%
Series 1
Series 1
0% 20% 40% 60%
Desktop PC
Laptop/notebook PC
Tablet
Smartphone
Television set
41%
58%
37%
37%
35%
Series 1
Series 1
Source: IDC’s 2015 U.S. Consumer Video Survey Base: 2,006 US consumers
Cloud growth & relentless innovation
Cloud growth & relentless innovation Innovation: @scale, @velocity, @low-cost
2014 2015 2016 2017 2018
$57 $70
$86 $105
$128
Source: Worldwide and Regional Public IT Cloud Services 2014-2018 Forecast (Doc #251730), IDC Public Cloud Tracker
Cloud and the Third Platform Enable…
Industry Platforms The Next “Killer Apps”
By 2016, over 50% of
compute, 70% of storage
capacity will be installed in
hyperscale data centers. -
500
1,000
1,500
2,000
2,500
3,000
3,500
2012 2013 2014 2015 2016 2017 2018
Mid-tier SP Datacenter High-end SP Datacenter Mega SP Datacenter
Service Provider Data Center Forecast
Mid-tier = 2,000-20,000 sq. feet High-end = 20,000 sq feet Mega = 50,000+ sq feet
Source: Market Analysis Perspective Worldwide Datacenter 2015. Sept 2015. IDC#258853.
Data Center growth accelerates toward services
Traffic volume-velocity drives network transformation
• Realignment and rebalancing of datacenters in the world of the 3rd Platform
• New phase of innovation and growth: high performance, low cost bandwidth, virtualization of network functions.
70% of large and midsized datacenters
will overhaul their network infrastructure
Monetizing the data opportunity
____
_ 1. Smart Pipe
____
_ 2. Revenue Share
____
_ 3. Offers OTT XaaS
Smart Pipe Network
1. Smart pipe – policy, billing, APIs
Smart Pipe
Network is a broker
-- Add value to subscriber and to OTT provider. • Policy and billing are key enablers to replace standard business model
with brokerage model where customer experience takes central role.
• Multi-dimensional intelligence is applied for network monetization – Bill on the broadband bill, not just a credit card.
– Subscriber/network intelligence – identity awareness, device awareness, network analytics, preferences, habits, behaviors
– Network intelligence – access network selection, SDN & NFV,
– APIs – network exposure, network performance, network boost,
– Advertising – intelligent ad insert.
2. Revenue share – CDN & VNF
Network
Internet access fees
CDN, caching, acceleration
• OTT shares revenue with network provider based on guaranteed application throughput, download time, etc.
• This requires investment in
• Quality of experience improvement platforms -- CDN, caching, web acceleration
• Virtual network functions - dynamic capacity, dynamic connections, dynamic prioritization
3a. OTT Offer
• Common practice
Operator buys content rights
• Partners
Operator branded service
OTT Video -- Everybody is doing it
Cablevision CEO James Dolan, speaking at INTX: “Every dollar of profit I make in video I make $7 in profit in broadband.”
But….
3b. XaaS offer
Here’s the plan
• Build a unique IT solutions platform.
• Create a comprehensive network and hybrid IT solution.
• Market the importance of network asset ownership
But
• Market growth remains dominated by: AWS, Microsoft Azure, Salesforce, IBM, Google, Alibaba Aliyun.
Source: Centurylink, 2015
The XaaS Strategy of a Carrier
Opportunity in smart pipe & revenue share
Manage the multi-everything value proposition Deliver actionable
data & analytics
Cross selling TV, video and
XaaS
Either Or
Manage the “multi-everything” value proposition
• Make TV relevant for users by: - Multi-screen centric -- Providing content on all screens all the
time
- Seamless federation – OTT multi-channels, multi-XaaS integration
- Content discovery -- Using that information to promote and deliver what each individual wants most
- Nextgen UI with ease of navigation - Creating a compelling interactive experience
Go beyond triple play/quad play
Actionable Data & Analytics
Industry focus on and discussion about actionable data rather than just data
• Deep customer insights
• Personalization, discovery/recommendations
• Monetization, ad insertion
• Customer service informed by data
Within OTT and traditional pay TV/STB environments.
Conclusion
•Dynamic changes in consumer experiences
•Digital transformation of business with third platform
Integrated billing
Content aggregation/
federation Follow me TV
Packaging other services (smart home)
Big data
Operator has core strengths beyond cross-selling video & XaaS
Ultra-Broadband Forum 2015
Thank you