Ankeena Networks, provider of new media infrastructure solutions, released a recently published whitepaper that discusses the radical growth and changing business dynamics of online video delivery. Internet Research Group (IRG) conducted interviews with dozens of industry experts in developing, “Internet Video: An Assessment.” The experts came from content delivery network, content aggregator services, content owner, traditional media and technology products and services markets.
From these interviews, as well as IRG’s own findings, some clear trends in the Internet video market emerged:
•Within the next few years, a critical point in the evolution of Internet video will be reached, when the typical viewing experience is comparable to that of conventional TV. At this point a wealth of existing TV content and a great deal of experience monetizing that content will become directly applicable to the Internet.
•Because the Internet is such a flexible advertising medium, it’s possible that viewing on the Internet will generate greater per-viewer advertising revenues than ads viewed on TV, because on the Internet the ads can be personalized to the viewer.
•Internet video has become a preferred form of television for some groups. For many college students, watching on their personal computer is preferred. For people at work, Internet video is the only option for sports or special events.
•While the business models and value chain positioning will continue to evolve, the need for a very high-quality viewing experience as we have come to expect with TV, movies and today’s on-demand DVR system is absolute.
•Media infrastructure and delivery technologies will play a significant role in unraveling the complexity and challenges of online video delivery to support a TV-like experience. This establishes a clear value proposition for media delivery platform vendors to provide this critical technical infrastructure.
•Lowering CapEx and OpEx will make a material difference to the bottom line to the business of video delivery. With a large number of data centers operating at capacity limits, the ability to deliver video streams with fewer servers and reduced power consumption is an essential priority.
“The era of Internet video is just beginning, however with more than a decade of intense Internet use and experimentation under our collective belts, there can be little remaining doubt that video is one of the most important Internet use cases,” noted IRG. “Internet video delivery can be configured and used very flexibly, much more so than television. To some degree, the whole value chain for Internet video is up for grabs. This is an excellent time to enter the market and experiment with some of the diverse options available.”
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