An industry first: New business case reveals the ROI value of virtualizing the video-delivery network
02 Dec 2016
An industry first: New business case reveals the ROI value of virtualizing the video-delivery network
Calling all parents – does this sound familiar? My youngest kid (5) is quite happy watching her favourite shows on any device – except for on a TV… I’ve tried countless times to persuade her about the benefits and comforts of watching on a big screen and I’ve even taught her how to stream content from the iPad to the TV, but when confronted with an adamant “it’s more fun to watch it like this”, nothing works. And it’s not just her – walk into our living room and chances are you’ll find her sitting on the couch next to her brothers who are all watching different shows on different devices.
Multi-screen is obviously a huge challenge and strain on the network – the capacity demands of video being streamed from 4-5 different devices (compared to a single one on broadcast or even cable technology) is something than can literally kill the network.
Traditional pay TV providers need to re-invent themselves if they’re to stay relevant for next generation – they need to find a way to still provide these service in as cost effective way as possible, and to differentiate themselves in quality, content and innovation compared to the OTT video players.
Is virtualization the answer for the traditional pay-tv provider who wants to keep up with the increasing changing demand and behavior of video-services consumption? I’m not just talking about supporting the demand of multiscreen experiences, or even personalizing them – how about, for example, 4K ultra-definition content over big screen TVs? (Personally, I can’t wait to see Messi score a brilliant goal in 4K.)
In theory, virtualizing the video delivery network could be a very important building block to achieving these goals but it’s hard to say for certain without first quantifying the return on investment. However, this is something that Amdocs has just done (and will reveal at TMF Live Asia on 6th December at 17:05).
Using inputs from Tier -1 Pay-TV operators, we commissioned Analysys Mason to build the industry’s first business case for a Tier 1 fixed-line operator which transitions from providing fixed legacy video services to providing ultra-high definition (4K) multiscreen and OTT services by implementing network function virtualization (NFV), software-defined networking (SDN), and cloud-enabled video services.
And the results were pretty interesting…
For example, the service elasticity, reduced operational costs, improved service assurance capabilities and the new potential revenue streams (like selling storage for cloud DVR) provide an estimated ROI of 44%.
That’s a net value of $1.6 billion after 5 years, and payback after 2.6 years.
Break down the numbers a little further and we discovered:
(And let’s not forget the vastly improved customer experience by using proactive fault identification and automatic resolution).
I’ll be sharing the full results of this new business case in detail in my session at TM Forum Live! Asia, 'Virtual TV – Why virtualization of fixed video content delivery networks is essential for success'. Hope to see you there!
Multi-screen is obviously a huge challenge and strain on the network – the capacity demands of video being streamed from 4-5 different devices (compared to a single one on broadcast or even cable technology) is something than can literally kill the network.
Traditional pay TV providers need to re-invent themselves if they’re to stay relevant for next generation – they need to find a way to still provide these service in as cost effective way as possible, and to differentiate themselves in quality, content and innovation compared to the OTT video players.
Is virtualization the answer for the traditional pay-tv provider who wants to keep up with the increasing changing demand and behavior of video-services consumption? I’m not just talking about supporting the demand of multiscreen experiences, or even personalizing them – how about, for example, 4K ultra-definition content over big screen TVs? (Personally, I can’t wait to see Messi score a brilliant goal in 4K.)
In theory, virtualizing the video delivery network could be a very important building block to achieving these goals but it’s hard to say for certain without first quantifying the return on investment. However, this is something that Amdocs has just done (and will reveal at TMF Live Asia on 6th December at 17:05).
Using inputs from Tier -1 Pay-TV operators, we commissioned Analysys Mason to build the industry’s first business case for a Tier 1 fixed-line operator which transitions from providing fixed legacy video services to providing ultra-high definition (4K) multiscreen and OTT services by implementing network function virtualization (NFV), software-defined networking (SDN), and cloud-enabled video services.
And the results were pretty interesting…
For example, the service elasticity, reduced operational costs, improved service assurance capabilities and the new potential revenue streams (like selling storage for cloud DVR) provide an estimated ROI of 44%.
That’s a net value of $1.6 billion after 5 years, and payback after 2.6 years.
Break down the numbers a little further and we discovered:
- 59% reduction in operational costs
- 35% reduction in service assurance costs
(And let’s not forget the vastly improved customer experience by using proactive fault identification and automatic resolution).
I’ll be sharing the full results of this new business case in detail in my session at TM Forum Live! Asia, 'Virtual TV – Why virtualization of fixed video content delivery networks is essential for success'. Hope to see you there!