EMEA 2011 (15)

Theme: Over-the-top and at the bottom - the video ‘state-of-the-start’

Video is the biggest and fastest growing consumer of broadband capacity. It has been around so long that it is strange to see it reborn in a new guise and at the start again. The published projections for video bandwidth consumption must keep telecom network executives up at night. “Internet video surpasses P2P”, video traffic of all types will, “account for close to 90 percent of consumer traffic by 2012”, “video growth is in its initial stages”, are just a few of the predictions - many are still more frightening. At first glance, one would expect most carriers to be delighted, nevertheless unresolved net neutrality issues, the uncertainty about usage-based billing schemes, and the migration of users from cable TV to over-the-top (OTT) viewing has pay-TV providers reviewing their business models.

In regions where pay-TV is an entrenched, developed, market the issues are quite a bit different than those faced in emerging regions where subscriber TV is often either limited or non-existent. While over-the-top video and content - programming that rides the Internet and bypasses the established delivery networks - is taking some business away from the cablecos, cable is far from beaten for a wide variety of reasons. On the bottom of the market, in emerging regions, though, the economics of OTT - it’s free -seems likely to guarantee a good following and to push the market for broadband access.

The transformation of video is more than just a question of entertainment. It will re-shape networks and the economics of the entire ICT sector in both developed and emerging economies.