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LTE Broadcast part 5/5: Verizon prepares for first commercial launch Q3 2014

We spoke to Bill Goers, head of the wireless demonstration team at Alcatel-Lucent, which supplied the platform for the Verizon Wireless LTE Broadcast trial at the recent US Super Bowl.

Following its successful demonstration of LTE Broadcast at the recent US Super Bowl, Verizon Wireless is now engaged in the final run in towards the world’s first commercial launch of a service based on eMBMS (Evolved Multimedia Broadcast Multicast Service) technology in the third quarter of this year. Verizon Wireless’ director of mobile video delivery Parissa Pandkhou indicated that this would happen after the relevant network infrastructure upgrades had been performed by the middle of the year. This includes upgrading the MME (Mobility Management Entity) in the base station to enable broadcast over the radio access network (RAN) and also deploying the BM-SC (Broadcast Multicast Service Center) for session and transmission control along with security and content synchronization. The eMBMS Gateway also has to be installed to enable IP multicast distribution across the operator’s core and backhaul network. LTE Broadcast is multicast out as far as the RAN, allowing operators to select which cells receive the streamed video content. Verizon Wireless has selected both Alcatel-Lucent and Ericsson as co-suppliers of this LTE Broadcast platform.

The handsets also need to be upgraded and so Pandkhou pointed out that at the same time Verizon Wireless was working with manufacturers to ensure there would be a reasonable number of LTE Broadcast capable smartphones and tablets by the time of the launch. For the Super Bowl demo, which we first reviewed as it was happening in the fourth blog in this series, Verizon Wireless used two handsets that are already LTE Broadcast capable. One was Verizon’s own branded tablet running an LTE module provided by Paris based 4G chipset maker Sequans and the other the commercially available Samsung Galaxy Note 3 5.7 inch smartphone with an LTE chipset from Qualcomm.

The Super Bowl was not a field test but featured demonstrations from a booth in the ground through which 7000 people passed during the event. The objective was not to assess the technology, which had already been proven, but to play around with use cases and obtain public feedback that would help determine the shape of the service on the launch.

Indeed the platform is now ready to go and Verizon Wireless could launch the service very quickly, according to Alcatel-Lucent’s head of wireless demonstration Bill Goers. But first Verizon wants to work out how best to charge for it. While the Super Bowl demo could not directly answer that question it did provide a lot of valuable feedback about the sort of features that would interest users and therefore at the very least make a mobile service stickier. The key point was that LTE Broadcast enables a sporting event to replicate many of the video features people get at home on their TVs, by effectively turning their handsets into mobile PVRs (Personal Video Recorders). These include commentaries, instant replays, game statistics and interviews with players.

Some of these were provided during the Super Bowl demo, with the additional ingredient of support for user generated content. There is the potential to enable uploading of video from spectators at an event, which could be a concert as well as a sporting contest, for example to provide different camera angles and perspectives beyond those captured by professional camera crews. As Goers noted this would require some moderating function but has the potential to add value by generating novel video streams that can be watched while the event is still going on, or even near live. Such content can be made available as a progressive download so that users can start watching immediately while also having it available for subsequent viewing. In this way LTE Broadcast can deliver a video experience that is in some respects superior to the one available at home.

This ability of LTE Broadcast to at least match the home viewing experience is also appealing to leagues and sports organizers, the US NFL (National Football League) in the case of Super Bowl. The NFL still derives 40% of its income from paying spectators at the gate and yet numbers have been declining because the ever improving experience of watching on TV has made some people question whether it is worth paying up to $100 or more to attend the games, often in the cold and with a poorer view of the action than they are getting at home. The NFL is very interested in the potential of LTE Broadcast to attract more people to games, which itself suggests one avenue to monetization. The LTE operator could take a proportion of gate money over and above a target amount.

What seems unlikely is that users will be charged extra for LTE Broadcast at these events, given that the objective is to enhance the experience of attending without imposing yet another tariff on top of the gate fee. There is though the great potential for location based advertising and information services not just at sporting events or concerts but also at other venues where large numbers of people congregate on a more continuous basis, such as airports, shopping malls and college campuses.  All bets are on during these early days for LTE Broadcast but there is a strong and mounting conviction that revenue opportunities will be there for the taking.

Companies that we have mentioned in the series include Alcatel Lucent, Birdstep Technology, Ericsson, Qualcomm, Sequans, and the operators that have been the most open about their efforts are Verizon and Telstra.

This concludes our 5 part series on LTE Broadcast, which started here.

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LTE Broadcast part 4/5: Mobile broadcast comes of age at last with Verizon Super Bowl demo

A major milestone in the checkered history of mobile broadcast has been reached with a demonstration at the US Super Bowl, one of the country’s biggest and most iconic sporting events. For years mobile broadcast has stuttered, let down by poor business models, the cost of infrastructure and lack of support on consumer devices. While all of these remain hurdles, the latest version of the technology, LTE Broadcast, does really look as if at last it is going to prevail over them. It is ironic that the first LTE Broadcast transmission over a commercial LTE network by Australian operator Telstra in October 2013 almost coincided with the closure of the one of the last services based on the earlier DVB-H technology that was once widely viewed as opening the era of mobile broadcast. The fact that did not happen was not really a reflection of DVB-H itself but more the costs associated with its deployment and fact that devices did not support it.

While talk of successful business models and monetization is still premature, two big related factors have changed in favour of mobile broadcast. These are the arrival of tablets and larger smartphones as attractive and capable viewing devices, which in turn is driving up mobile data traffic at almost exponential rates. Much of that traffic soaking up backhaul bandwidth and RAN (Radio Access Network) spectrum is unicast video. Yet a lot of that at certain peak times is live streaming video that is consumed by many people at a given time. If it could be multicast, then only one instance of that video would need to be transmitted across a given backhaul link and RAN cell. The potential for cost saving as well as improved QoS is immense.

Events like Super Bowl are precisely what we mean here, since there are large numbers of people in one place, many of whom would love to snack relevant video on their mobile handsets such as action replays, or associated data like player stats. Verizon’s Super Bowl experiment is not full scale as it does not involve general user handsets. It will not yet indicate what impact the technology has on end to end network performance and congestion. But it is a good proof of concept that will be followed by larger experiments when wider handset support is available.

In fact the Verizon Wireless live demo, running over five days at Bryant Park in New York, involves streaming of live NFL (National Football League) content to dedicated tablets in the facility called "Verizon Power House" set up in Bryant Park using LTE Broadcast technology provided by chip maker Sequans. The tablets are running Sequans' eMBMS-capable Mont Blanc LTE platform and issued to visitors try out the LTE streaming prior to and during the event.

While this was going on, European operators such as EE and Orange France have been carrying out small-scale trials of LTE Broadcast technology, having in the past tried out DVB-H. They now believe, like Verizon, that the initial motivation for LTE Broadcast will be to optimize capacity and improve service quality for customers in crowded areas. But as Verizon has noted, availability of mobile broadcast in such crowded areas will at the very least help gain and retain customers, with business opportunities such as location based advertising quickly following.

The other key thing is that LTE Broadcast has unwavering support from key industry players like Ericsson and Alcatel-Lucent, as well as those like Qualcomm that got their fingers burned earlier on with mobile broadcast. We are now looking at handset availability and the first operational services sometime in 2015.

We’ll be talking to Alcatel Lucent in part five of this series, stay tuned.

Part 3 of this series is here.

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LTE Broadcast part 3/5: Reasons to be cheerful

With three mobile operators, Verizon Wireless, Telstra of Australia and Smart Communications in the Philippines, now having conducted successful trials of LTE Broadcast, it is a good time to assess why at last multicast video transmission over cellular is coming of age.

There have been various failures in the past, such as DVB-H, mostly in Europe, and Qualcomm’s MediaFLO in the US, but they came too early and did not meet all the technological challenges. The underlying factor is the proliferation of tablets and ever larger smartphones, providing users with compelling mobile devices conducive not just for snacking but also consuming longer form content. This in turn has created a surge in video consumption over cellular that threatens to swamp both radio spectrum and the backhaul capacity of radio operators.  LTE Broadcast can save spectrum and fixed network capacity for popular live or linear video content that is consumed simultaneously by a sufficiently large number of people that would otherwise generate multiple unicast streams down to the cell level.

If there are only one or two people in each cell watching a given stream, then LTE Broadcast will not save much spectrum. But there is usually at any one time some relatively popular content being streamed over a given cellular network. Therefore, as various surveys from Ericsson and others have indicated, on average a mobile operator can cut traffic by at least 10% through use of LTE Broadcast. But that does not give the full picture, since the savings will be greater at peak times when more popular content tends to be consumed.

But the killer use case is for venue broadcasting, where hundreds or even thousands of people at say a large sporting event or concert may simultaneously want to tuck into action replays or content relevant to the occasion. Then LTE Broadcast becomes essential both to feed the cell where the venue is located and to distribute the content to devices over the RAN (Radio Access Network). Of course earlier cellular broadcast technologies could also serve venues in principle, but fell down over cost of infrastructure, lack of complaint devices and mobile screens being too small for compelling viewing. DVB-H required significant additional infrastructure investment to deploy, as well as specific upgrades to handsets.

LTE Broadcast will run over all LTE infrastructure and while it is not supported by current commercially available handsets, it will come out of the box with the next generation ready to hit the market in the second half of 2014. It also delivers video much more efficiently than its ancestors such as DVB-H, partly through being based on the 3GPP eMBMS (Evolved Multimedia Broadcast Multicast Service). eMBMS uses OFDM (Orthogonal Frequency Division Multiplexing), which has been incorporated a while in other wireless systems such as Wi-Fi, Wimax and DVB broadcast, but is new to cellular. The key point is that OFDM is a form of inverse multiplexing, splitting the broadcast signal over multiple low bit rate carriers that are therefore closely spaced in frequency, but do not interfere with each other because the waves are out of phase with each other.

This greatly increases robustness against fading at a given frequency, since the signal is split out across a range of frequencies. This robustness enables LTE Broadcast to deliver premium broadcast quality video over cellular for the first time. Apart from eMBMS, LTE Broadcast will in future be able to take advantage of associated developments in video transmission, in particular MPEG DASH for standardized streaming and HEVC (High Efficiency Video Coding)/H.265 for stronger video compression. Taken together these technologies will ensure that LTE Broadcast both reduces bandwidth consumed by mobile video and increases the quality. This is why despite having been bitten before the cellular industry is convinced that LTE

Broadcast will be a great success. Part one in the series by Philip Hunter is here, part two is here and part four is here.
Philip Hunter

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LTE Broadcast 2/5: operators get new revenue options

Now that LTE Broadcast is off the ground following the world’s first session on a commercial LTE network transmitted by Australian operator Telstra, attention has naturally turned to potential use cases and revenue generating opportunities. The initial attraction for cellular operators, once they have a sufficiently widespread LTE network in the target region, is the significant bandwidth saving they will get when streaming popular live video, with the consequent ability to optimise capacity and improve service quality for customers, especially in crowded areas. That is a business rather than a specific use case, but at least one major operator is planning to come out with all guns blazing with the latter from day one.

Verizon Wireless has already confirmed it intends to time its 2014 launch of LTE Broadcast in the US to coincide with one of the nation’s iconic sporting events to use the technology for streaming video in the stadium. This event is now widely believed to be SuperBowl, the annual championship of the US National Football League, to be held in New York on Sunday February 2nd 2014. This could be a big day for establishing LTE Broadcast’s most widely touted use case for broadcasting coverage, replays and associated video around sporting or music events where there are large numbers of people concentrated into a venue or arena. Without LTE Broadcast such content has to be unicast, which would cripple a cell and leave many users unable to access the service, while also causing congestion on the associated backhaul networks.

For operators this use case, live event streaming, offers potential both for cost savings by reducing or avoiding need for network expansion and also for generating revenue in various ways, for example subscriptions, pay per view, pay per event, a seasonal pass, or revenue sharing with content partners. Apart from live event streaming, other interesting use cases are on the horizon under five broad categories: real time video streaming across the whole network, news services, broadcast radio, off peak media delivery and cell based advertising. Real time streaming again offers revenue sharing opportunities, most likely with broadcasters or pay TV operators as the mobile part of their TV Everywhere strategies, perhaps combined with Wi-Fi hot spots. Already Verizon Wireless is in talks with US cable operators along these lines. Then for news services, LTE Broadcast has the potential to extend the scope of existing offerings by delivering news and sport as live updates or clips. There is the option of combining these with personalized lower bandwidth unicast services, such as specific stock updates.

These news services could be given away free as part of a premium offering to extract higher subscriptions, or could be advertising driven. The broadcast radio category is also creating some interest as a way of saving unicast capacity while again creating scope for upselling to premium packages and carrying advertising, as well as revenue sharing with providers of content such as music. Then the off peak delivery use case brings a range of opportunities, especially perhaps for tablets as they have greater storage capability, turning them into mobile DVRs (Digital Video Recorders). TV shows, movies, YouTube videos and newspapers could all be drip fed to devices this way, as could software updates. Apart from saving bandwidth this has pay per view opportunities as well as revenue sharing. Finally cell based advertising can be used to deliver ads targeted on the basis of location rather than personal preferences, with live events themselves being an obvious case, but also shopping malls and airports where particular retail outlets or restaurants might want to advertise to mobile users while in that vicinity.

This can be achieved by partitioning LTE Broadcast on a cell by cell basis, so that separate content would be sent to each cell. Most of these use cases are unlikely to be deployed in the immediate future as they will have to wait for widespread availability of devices compatible with LTE Broadcast, which will not be until well into 2015 at least. Meanwhile though some questions are arising, such as how LTE Broadcast will affect Wi-Fi expansion.

There has been interest in Wi-Fi broadcast as well for live events, with Cisco already offering this with its StadiumVision mobile app, which users can download at venues to access event specific broadcast streams over Wi-Fi. This could well compete with LTE Broadcast for live events streaming, but that is another story. Part one in this series is here and part three is here.

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The Big Data emperor will need Big Change within companies, that is if he has any clothes on. Summit report Part III

There was a great turnout to TM Forum’s inaugural event on Big Data in January. It was small enough to enable proper networking, but the packed room made it feels like this something more than just hype or buzz is happening around Big Data.

Some of the clear benefits Big Data brings at once

A key benefit EBay has gotten out of Big Data analytics after having started with Hadoop in 2010 is a greater flexibility. An example of what they can do better now is to work out how much to bid on specific keywords like “iPad” because the decision often has to be made in near real-time. Big Data helps eBay manage they key differences in word meaning from market to market.

Bell Canada was one of the more upbeat operators on Big Data. James Gazzola made a case for Advertising Forensics where the operator could use analytics to determine which ads are actually watched. Bell hopes that these insights, once mastered could be monetized. Gazzola went on to point out that as Bell Canada serves 66% of Canadians, analytics could show what's happening in all of Canada. That sent a slight shiver down my back as I wondered if the journey from network planning to user analytics actually terminated at a station called to Big Brother, but oops this is the part on benefits. So back to more down to earth issues, Gazzola told the audience that voice traffic used to be relatively predictable, but that data traffic driven by smartphones is anything but. Big Data is what Bell is looking at to help planning future network capacities.

Google’s presentation was disappointing. I don’t really blame Google speakers because the expectations are always unrealistically high: there’s so much we crave to know about Google. Matt McNeil, from Google’s Enterprise division was asked if they have any big Telco clients for Big Data yet. His wooden answer that "we're talking to several" showed the limits of the company’s transparency policy. But during his sales pitch, Matt got quite excited explaining that “it'll cost you 5M$ to build the capacity Google charges just 500$ per hour, for a Hadoop-powered Big Data analysis platform”. When McNeil showed off with http://bigquery.cloud.google.com, the exciting fact that “Led Zeppelin” is more controversial than “Hitler” got me a bit concerned that maybe all this Big Data stuff really was hype after all. I suppose we need practice finding more telling examples because as Matt did say himself “this year will be a trough of disillusionment for Big Data”.

Big Data is about Big change

Peter Crayfourd who recently left Orange, pointed out that becoming truly customer-centric can be scary. Such an approach may uncover many unhappy customers. But becoming truly customer-centric will take at least 5 years. All speakers at the Big Data conference seemed in agreement that user centric KPIs based on averages are to be shunned because users are so very unique! That sounds fine in theory but CFO’s are going to need to stay up late finding out how to live without the concept of ARPU.

The eye-opening presentation from Belgacom's Emmanuel Van Tomme stayed on the customer-centricity able but made the clearest case so far that change management is key to Big Data implementation. Emmanuel was the first Telco guy I’ve heard talk about a great new metric called VAP or Very Annoyed People. They can now be identified with Big Data analytics.

Many speakers converged on the theme of "change management" as THE key challenge for Big Data going forward. The general message was that if Hadoop is ready to deliver, people and even less their organizations were not yet.

Thinking of the bigger Telcos conjures up an image of oil tankers trying to steer away from network metrics towards usage metrics. Looking solely at the agility dimension I couldn’t help wondering if they could survive the speedboats like Amazon or Google.

As the conference was wrapping up I gleaned an interesting metric: subscribers are 51% more willing to share their data if they have the control of whether or not to share it in the first place! It’s one of those Doh!-I-knew-that statistics you feel you should have come up with, but didn’t.

Earlier it had been pointed out during one of the panel sessions that to make Big Data work for Telcos, subscribers must entrust ALL their data to the operator. For them to agree to this, the outbound sales & marketing link must be cut. It’s probably wiser to have one unhappy head of sales than many unhappy customers.

But things aren’t so simple

The limitations of KPIs

Peter Crayfourd illustrated the danger of KPIs with the voice continuity metric. In his example it was 96% when calculated over 15 minutes, so if that’s what your tracking all is hunky dory.  But in the same network environment, when the same metric is calculated over 45 days the result is usually 0%. Crayfourd went on to explain how averages can be dangerous within an organization: someone with their head in the oven feet in freezer has good average temp! Matt Olson from US operator Century Link pointed out that in the User eXperience (UX) domain simple maths just don't work: UX isn't the sum of the parts but some more complex function thereof.

Listening to the UX focussed presentations one got the feeling that the Big Data story might just be a pretext for some new guys to come steal the carpet from under the feet of the QoE market stakeholders. They’ve been saying this for almost a decade … Big Data is a means not an end.

Cost of Big Data & Hadoop.

For EBay, Hadoop may be cheaper to setup, but it’s so much less efficient to run than structured data that the TCO currently seems the same as with other enterprise solutions.

Google, eBay and even Microsoft made compelling presentations about the nuts and bolts of Big Data and then tried to resell their capabilities to the service providers in the room. TM Forum could have been a bot more ambitious and tried to get more head-on strategic discussions going on how the big pure-play OTT giants are actually eating Telco and other Service provider’s lunch. Maybe a lively debate to setup in Cannes?

Does the Emperor have any clothes on?

UK hosting company MEMSET's Kate Craig-Wood isn’t sure at all. Kate said that Big Data techniques are only needed in a very few cases where many hundreds of terabytes are involved and near real-time results are required. She does concede that the concepts born from Big Data are useful for all.

MEMSET’s co-founder went on to explain how a simple open source SQL based DBMS called SQlite successfully delivered interesting analysis on hundreds of Billions of data points, where MySQL had fallen over. She had to simplify and reorganize data and importing it took 4 days, but once that was done she got her query answered in minutes. Ms Craig-Wood went on to say that the SQL community is working flat out to solve scalability issues going as far as saying "I'd put my money on SQL evolving to solve most of the Big Data problems". There's so much SQL expertise out there!

Perhaps the most controversial part of this refreshing Big Data debunking session from Kate Craig-Wood of MEMSET was when she said that “I don't believe in data scientists, most DevOps will do fine, and Hadoop isn't that complex anyway”. She has a point: we're at the pinnacle of the hype cycle.

Caution

Less extreme but still on the side of caution were the sensible questions from Telefonica that is experimenting with Big Data. The Spanish operator is still cautious about the “high entrance cost” and uncertain final price tag or TCO. So far the Telco has built both a centralized cloud instance of its platform and also separate instances for each of its operating companies in different markets. Telefonica’s Daniel Rodriguez Sierra gave an amusing definition of Big Data as simply those queries we can't handle with current technology.

Verizon wireless also reaffirmed the need for caution pointing out that to implement Big Data and reap any benefit thereof you need an agile trial and error approach. That’s a tall order for any incumbent Telco. The US mobile operator admitted that it was being wooed by the likes of Google, Amazon and EBay that would all love to resell their analytics capability to Verizon. But staunch resistance is the party line as Verizon mobile has the scale (and pockets) to determine that the core data is too strategic to be outsourced. In terms of scale Verizon wireless has 100M subs and 57K towers that generate a petabyte of data or 1,25 trillion objects per day crunched currently with 10K CPUs. Verizon’s Ben Parker was pleasantly open saying that an "army of lawyers is happily supplied with plenty of privacy work now we're capturing info on all data packets".

Governance was too frequently mentioned during several presentations not raise an alarm bell in my mind. It seems that those who’ve actually got their hands dirty with Big Data are finding themselves embarked on projects that are difficult to control.

In the end

I was really impressed by the commitment operators are making to big Data on the one hand while clearly expressing reservations or at least warning that we’re just at the beginning of what’s going to be a long Journey.

For further reading here are three other write-ups of the event that I commend:

There’s a mini video interview of Peter Crayfourd here: http://vimeo.com/58535980

Part I of this report (interview of TM Forum's Strategy Officer) is here.

Part II, a discussion with Guavus and Esri, is here.

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The Connected Home is almost here, not quite

The exhibition
For once got to see all that was on show in the booths as there were four to visit. This was surprising as the show is already in its third year, but also gave a feel of being part of a closely guarded secret

Motorola was showing their 4HOME acquisition of October last year. This is a software platform for service providers including energy companies. The service provides a home-control and monitoring platform residing in the cloud.
The message to telecoms operators is that as VOiP is commoditized, this approach can add value. This idea was echoed during the conference by the Telco speakers like Ann Shaub of Verizon.
Use cases revolve around triggering cameras and door locks for example to let delivery man in or check if the kids haven’t left the lights on or have they arrived home after school.
4Home call this “assisted living” and hope to improve energy management. The platform’s concept is to create “scenes”, like going-to-bed or watching-a-movie.
4Home claim their Unique Selling Point is being able to link the scenes.
The demo on site was of an extremely basic Web interface to create such scenes. Clearly such a system can be useful, but needs to be integrated into an overall offering to really shine. I expect the Moto execs will get some compelling bundles together from their portfolio.

I was surprised to see T&W in another of the sparse booths. They are a Chinese hardware manufacturer of CPL, modems and the like, founded in 1991, they expect a 600M$ turnover for 2011. They have 7000 employees, 1000 of which are engineers. They were showing optical stuff: GPON (mainly for Europe), EPON (for Asia) and what they called point2point (for the connection to the home, to “replace last mile”), but their core business in DSL routers (over 20M units shipped per year). The message I got out of talking to them was that optical is the future I suppose this message comes from DSL margins having been commoditized to smithereens.

Twonky has a far sexier name than anyone else on the show and I had never seen a booth with quite so many goodies on display, but they didn’t give me much in the end. Twonky is a US company with development teams in Berlin and a presence in Basel & Tampere, they are the part of Packet video that Alcatel Lucent strangely didn’t buy almost a decade ago. They now belong to NTT DoCoMo. To position their home connectivity products, think of them as competing with Awox that I have written about a few times.
Like Awox, they are DLNA zealots and have software in the field. Western-Digital Media players constitute their largest installed base. They also equip some routers but they came to the show to target operators of all shapes & sizes.
I was impressed with Leon Chicheporte’s honesty when I told him about the inconclusive DLNA tests I had done in my home (see here). He said that 2 years ago we were only half way to usability for the end user, and that now we’re almost there. Note the ‘almost’. That kind of honesty makes me want to do business with a supplier.

3view is a new kid on the block in the STB-with-a-service-behind-it neighbourhood. Founded in 2009 and running out of central London, they are still independent and run off private funds.
They claim to be the 1st Z-wave enabled STB. The platform runs on the SD8655 chipset with a 500GB HD and twin DVB-T2 tuners. In the UK they are a consumer brand that deliver a YouView experience before YouView is ready, competing with the likes of FetchTV. The motto on the booth was just three words: Watch, Search and Interact which I thought was pretty slick marketing although I didn’t get a chance to check if they deliver on the promise.
The BBC iPlayer is already on board and they plan to have SkyPlayer by Q3 this year. Adaptive Bitrate Rate is supported over IP. Current retail price is £299 and the device has been shipping since Christmas from John Lewis and Amazon. They can deliver a white-label box to this spec for a BOM (Bill of Materials) of around £170.

The conference

I listened in to almost all of day one of this two-day conference and tweeted live from my @nebul2 account. The conference gave me the impression that we may not have peaked yet on the hype cycle i.e. there might still be more hype before this becomes really real. We also still need some more convincing use-cases to see the true value of a connected home.

Operators are taking the connected home seriously. It’s another way to avoid commoditization especially where content-based services are not delivering. Energy control is a promising feature for Verizon. It helps the operator onto the feel-good green bandwagon. But Ann Shaub underwhelmed me with the use-cases Verizon is working on for home automation. Her favourite was “Sleep mode” where you “just hit one switch for all doors to be locked and lights turned off, no more fumbling around in the dark…”. It sounded a bit like using a sledge-hammer to push a drawing pin into a soft wall. She did however make excellent business sense when pointing out that STBs are still very expensive and difficult to keep relevant over the full (accounting) lifespan of the device. Convergence between the STB and other devices still remains to be clarified.
Ann went on to tell us the key marketing messages for Verizon’s connected home initiative: it’s about “Peace of mind” & “ease of use” and not about “saving money”. The current pricing model is a $9,95 subscription with devices being slightly subsidised. Verizon doesn’t want to get into CPE business. The current trial will turn into a soft launch very soon, with a hard launch still a bit further away.

Paul Berriman, the industry veteran from PCCW in Hong Kong, gave a broad talk about the overall strategy there. The journey from Fixed line to TV to PC to Mobile phones to Tablets & Games consoles now has to go through the connected home so as to get it all to work together. I agree when he says that getting all the devices to interoperate is going to be a real challenge, but that interoperability will become a USP once it does work. He spoke of a special focus at PCCW on enabling the free flow of content throughout the home but I think that may still be out of reach for premium content as rights owners stay too picky on DRM. “NOW 360” tries to capture ALL the screen usages of PCCW customers whatever the screen. Paul finished with one of those simple “why didn’t I think of that?” questions: health has been targeted BY operators for years and they have already spent a lot on it, but as fitness requires the same kind of infrastructure and has an early-adopter target market to boot, why not start there? Makes sense, so maybe will see Runkeeper types of apps from operators …

The conference organisers then did a strange thing. A video of a presentation from IPTVWF a few months ago was shown. In the audience we all looked at each other wondering what was going on. I doubt anyone listened to much of the Telecom New Zealand presentation, we were so bemused by this strange process. I am green, but this was pushing recycling too far.

Raoul Wijgergangs of Sigma Designs came on next to say that the key to the connected home is already here in the form of the G.hn standard. He promised products with a bandwidth 2,5 times faster than today’s HomeplugAV, before the end of the year. The prototype devices he showed looked so small that even if the STB remains part of the ecosystem we’ll have to stop calling it a box. I agree with his view that home automation is the “low-hanging fruit” of the connected home, but I wish he’d told us what SD think lies on the higher branches, out of sight.

Thomas Kleist of Native made an interesting point during the next panel session: exclusivity is an OK entry point for operators, but over time openness (i.e. apps) will be the winning strategy.
On the same panel Steve Koenig of the CE Association in the US illustrated how energy is creeping into CE purchasing decisions (85% of buyers care about it compared to 95% for price & only 57% for brand). He went on to say that Americans are driven to reduce energy consumption only because of cost. Doh! That got me wondering if taxing energy, as we do in parts of Europe, will slow down the connected home…

The next panel on "Monetizing the digitized home" had just 2 panellists, which poses the question of whether the subject is addressable yet. Swisscom was pessimistic on the connected home business model because the telecoms budget is fixed for most homes, so revenues has to come out of an existing spend. The question is what’s going to give?
As a vendor, Twonky was much more upbeat on the connected home’s business prospects, pointing out that as the TV will remain the best screen, and other devices will always be better for interaction, the secret to raising ARPU will be linking these two champions CQFD.

Tim Wright, one of the two Sony speakers, told the conference that the Ultraviolet common file format (CFF) contributes to interoperability within connected home and is complementary to DLNA. He made the case that this new industry initiative will reduce costs and not increase them for operators. I have yet to witness anything from the security industry reducing costs, but I do live in hope.

We then moved on to standards for the connected home. Rami Amit from Jungo was refreshingly honest in stating that DLNA streamers almost work, but not quite yet. Guilhem Poussot of Vodafone said that the next decade is going to be about user experience. When prompted from the audience about “whether standards are for losers” he boldly retorted that standards are for winners and in any case we have to beat Apple.
Another issue raised from the audience was on the openness of standards "the more open a standard, the easier it is to hack, so do we want an open standard in the living room at all?” When the chairman pushed even further by asking the panel if he’d ever get a virus on his TV, the question was politely ignored.
Helen Anders, a lawyer on the panel, reminded us that there have ALWAYS been competing standards like Beetamax vs. VHS, and she saw no reason that this will be any different for the connected home.
On the down side for standards Roger Blakeway of the SCTE couldn’t see Sky moving away from their box to any kind of open system.
This pessimism was countered by Sony’s Renaud Di Francesco who said that barriers put up by operators would soon be overcome by Wifi or LTE or some other pervasive technology.
Karl Tempest Mitchel from AirTies seemed less committal stating that the jury is still out as to which one it’ll be, but that one device will control content in the home.

Andrew Ladbrook an Informa analyst closed day one with some figures from the latest study on the connected home that he urged us to buy.
Games consoles will not grow as fast as Connected TV or Blueray, although they will become mainstream and be VERY connected (contrary to connectable Blu-ray that will most often not be connected in the home). Informa believes that Media-streamers à la Apple TV will remain niche.
Ladbrook made an interesting and controversial point on "Video not needing QoS" as seen by OTT boxes like those from Telstra (Netgem) or Telecom Italia (Cubovision) that he says are doing fine. Less QoS means less CAPEX & less OPEX. I’m not sure if this is linked to the connected home debate, but we’ll be seeing very soon if this strategy pans out over more than a quarter or two.
Informa wrapped up with some strategic advice, on defensive opportunities with multi-room offerings that enable connected home and reduce churn towards OTT providers. He finished by suggesting that the next-best defensive opportunity is improving home networking because that too enables the connected home as seen by Apple’s Airplay.