IP comes of age - TV’s most essential imperative
Ericsson (NASDAQ: ERIC) has released its second Game Changer paper, ‘The IP Imperative’, the latest installment in a six-part series that details the fundamental factors that are driving change across the TV and Media industry.
The IP Imperative highlights how the invention and adoption of IP (Internet Protocol) technology has defined a new era that has re-shaped our planet, our lives and global industries including TV and Media. Ericsson explores how IP has enabled an explosion in connected devices across the globe, a fuelling of enormous traffic growth in data networks of which video is the main component, a transformation of consumer expectations around video experiences and a fresh approach to collaboration between broadband providers, content owners and new market entrants.
Ericsson’s vision of ‘The IP Imperative’ highlights the following key findings:
| Today | Tomorrow | 2020 | |
|---|---|---|---|
|
Broadband Subscribers and Connected Devices |
Global mobile broadband subscriptions reached 2.3 billion in Q1 2014 All new devices are IP enabled The number of IP connected devices that can view video grew from 200 million (personal computers) to over 1.6 billion between 2000 and 2013 |
Rapid increase in mobile broadband subs Conversion of 3G Mobile broadband to LTE fast mobile broadband subscribers and devices Set-top boxes shrinking in cost and scope |
Over 8 billion connected mobile broadband subscribers 90% of the world’s population covered by mobile broadband Fixed broadband penetration reaches 1 billion home subscriptions 50 billion connected devices, of which 15 billion are video enabled Home DVR shifted to cloud and network |
|
Mobile Traffic |
Mobile data traffic in Q1 2014 exceeded total mobile data traffic in 2011 65% growth in data traffic between Q1 2013 and Q1 2014 |
Rapid growth in data traffic in fixed and mobile networks Mobile broadband traffic highest growth Video is the primary driver of all traffic growth |
Data traffic will increase by about 10 times Mobile broadband traffic will have reached almost 20 exabytes monthly Video represents 50% of all mobile broadband traffic |
|
Use of IP in Delivery |
Well established as a managed IPTV proposition with over 90 million global IPTV subscribers Well established in advanced markets – internet OTT delivery content Use of global CDNs by content owners to accelerate OTT traffic Hybrid terrestrial platforms defined and being adopted (YouView, HbbTV) |
Satellite and IP proprietary platforms will be deployed more widely LTE unicast video enhanced with LTE Broadcast deployments Most local telcos, cable operators and ISPs deploy operator CDN’s for acceleration and monetization of video traffic |
IP is the dominant video delivery network technology Global IPTV subscribers reach 200 million Emerging markets rely on mobile broadband for IP transformation OTT delivery model applicable to all industry players All pay TV service providers have a core IP strategy for delivery to the consumer |
|
Quality of Experience |
Consumers already used to good streaming experiences in-home OTT disruptors and content owners establishing models for paying for/investing in assured end consumer quality of experience Rapid video growth already straining networks |
Quality of experience/ bandwidth crunch looming unless networks invest in capacity and efficiency measures, and explore revenue generation opportunities Net neutrality and traffic optimization discussions ongoing in all countries |
Video consumption via mobile networks is as good as fixed networks in many countries Sufficient bandwidth and established revenue share to support viable OTT delivery model Time spent watching on-demand and time-shifted content will reach 50:50 parity with linear and live TV |
Source – Ericsson’s The IP Imperative Game Changer paper
"The impact of the internet on our daily lives is arguably the single biggest technological innovation of the last century and its effect on entertainment has been equally dramatic," said Per Borgklint, Senior Vice President and Head of Business Unit Support Solutions, Ericsson. "The adoption of IP has meant that the previously linear nature of broadcast television has shifted to a new interactive and on-demand paradigm that has delivered a path beyond the living room to connected devices all around the world.
"This change has huge consequences for industry players. Content owners, broadcasters and advertisers must adapt their business models to take advantage of more direct engagement with viewers; TV service providers must truly redefine consumer discovery and consumption experiences and embrace IP delivery; network owners must transform networks to cope with, and benefit from, the strain of increasing video traffic. The inflection point has been reached where broadband IP capacity has met with ever more IP-centric connected devices and the path to 2020 is clear – more speed, more demand and more immediacy."
Ericsson’s IP Imperative details how content owners, broadcasters, TV service providers, network owners and advertisers can flourish in 2020 as IP forces transformation of delivery networks, spectrum allocation and business models across the industry.
Notes to editors
Download high-resolution photos and broadcast-quality video at www.ericsson.com/press.
Ericsson is the driving force behind the Networked Society – a world leader in communications technology and services. Our long-term relationships with every major telecom operator in the world allow people, businesses and societies to fulfill their potential and create a more sustainable future.
Our services, software and infrastructure – especially in mobility, broadband and the cloud – are enabling the telecom industry and other sectors to do better business, increase efficiency, improve the user experience and capture new opportunities.
With more than 110,000 professionals and customers in 180 countries, we combine global scale with technology and services leadership. We support networks that connect more than 2.5 billion subscribers. Forty percent of the world’s mobile traffic is carried over Ericsson networks. And our investments in research and development ensure that our solutions – and our customers – stay in front.
Founded in 1876, Ericsson has its headquarters in Stockholm, Sweden. Net sales in 2013 were SEK 227.4 billion (USD 34.9 billion). Ericsson is listed on NASDAQ OMX stock exchange in Stockholm and the NASDAQ in New York.
For further information, please contact
Ericsson Corporate Public & Media Relations
Phone: +46 10 719 69 92
E-mail: media.relations@ericsson.com
Ericsson Investor Relations
Phone: +46 10 719 00 00
E-mail: investor.relations@ericsson.com