|By Esmeralda Swartz||
|May 6, 2014 11:00 AM EDT||
When the U.S. Appeals Court struck down the Open Internet Order's rules that prohibit Internet service providers (ISPs) from site-blocking and providing preferential service, the debate surrounding the true definition of an open and unfettered Internet reached fever pitch. Most of the large access providers in the U.S. are subsidiaries of traditional telecom carriers and cable companies. These companies fought hard for this ruling, so it is reasonable to expect that they already had their strategies in place and plans drawn up for the investments that will be needed to rebuild the Internet, or at least a part of it, according to their vision. It is about time too. Of all the technology companies that existed before the Internet, the telecom carriers and the cable companies were best-placed to take the lead in building the future. Yet in so many areas, the technical and service innovation came from new companies and organizations we had never heard of before - not from those traditional players. Phone and cable companies have never been leaders in the World Wide Web, cloud computing, social media, Voice over IP and many other areas. But now, they have changed the playing field (at least in the U.S.) to suit the game they want to play, and so, liberated from the fetters of the unfettered Internet, we have a right to expect new innovative services. With the gates opened to competitive differentiation, we're seeing interesting things, such as AT&T's $500 million joint venture with the Chernin Group to acquire, invest in and launch video-on-demand channels and streaming video services to compete with the likes of Netflix, Hulu and YouTube.
With more customers moving away from broadcast, cable or satellite TV, the opportunity to attract customers with an over-the-top (OTT) video-streaming and TV offering is significant, as is the opportunity for the right player(s) to deliver these services across multiple platforms (e.g., mobile) and distribution channels, thereby increasing revenue streams. OTT streaming services provide new players with the opportunity to deliver video content and new entertainment experiences to consumers outside traditional linear TV paths, such as cable, satellite or terrestrial. Since OTT services provide programming over the Internet and can come across the same wires as your cable TV service, the barriers to entry are greatly diminished.
It is no secret that AT&T has not been a fan of Netflix and the two are publicly quarreling over how much money the video service should pay for a direct connection to the AT&T network. It is worth noting that since the creation of the Internet, Web companies have negotiated peering and interconnection agreements where websites connect to intermediaries, which carry the traffic to ISPs, which deliver the content service to customers. Most people were not even aware of these interconnection relationships until February when Netflix agreed to pay Comcast to connect directly to its network. Though the Netflix CEO suggests that Comcast had strong-armed him into paying an "arbitrary tax," the deal ensures that Comcast customers have improved video quality for Netflix service.
Verizon has also asked Netflix to pay for a direct connection to its network, even as Verizon users (and AT&T customers, for that matter) complain of poor Netflix performance. Netflix has tried to avoid making payments, despite giving in to Comcast, and instead asked the FCC to issue net neutrality rules that "prevent ISPs from charging a toll for interconnection to services like Netflix, YouTube or Skype." Its request was rejected by the FCC when it indicated that it has no plans to expand its net neutrality rules to ensure that services like Netflix can connect to Internet providers' networks for free. In his response to Netflix, FCC Chairman Tom Wheeler asserted that the government has an important role to play in overseeing how networks connect to each other, but peering and interconnection arrangements are not a net neutrality issue under review by the Open Internet proceeding.
This is a highly charged argument for both sides. Carriers always have options when faced with growth exceeding capacity: either charge higher fees to reduce traffic or let congestion run rampant for all travelers. Unfortunately both these options have a negative customer satisfaction result and are lose-lose situations for the carrier. If the service quality for a streaming video is less than desirable, customers will get grumpy and blame their ISP for a "slow" connection. Netflix argues that "Some big [ISPs] are extracting a toll because they can-they effectively control access to millions of consumers and are willing to sacrifice the interests of their own customers to press Netflix and others to pay." Netflix is clearly upset, but video streaming has turned into a mass-market service and is a capacity hog. If Netflix and other OTT players want to use an increasingly scarce resource to carry its service at the quality levels the service dictates, who pays? There are limits that will be hit and someone will have to pay to expand the network due to growth in streaming, the growth of mobile and the coming tsunami of the Internet of Things.
Although the AT&T/Chernin deal marks the first time a big U.S. ISP has decided to go over the top with a TV service, Verizon also has plans for a streaming TV service through its acquisition of Intel Media, and has created a video streaming service by partnering with Redbox. On the broadcast side, Dish Network has also brokered a deal with Disney to stream Disney-owned channels such as ESPN and ABC over the Internet to customers' smartphones, tablets, video game consoles and other devices.
As more consumers increasingly view content on their smartphones, tablets, game consoles and connected TVs, the ability of a provider to reach across multiple platforms will unlock new monetization opportunities for a multiplatform experience.
AT&T's partnership with Chernin Group will bring a video-on-demand service to market, and presumably provide more content outside traditional broadcast options. If the content is rich enough, Comcast or Verizon FiOS TV subscribers can select the offering and put a wrench in the business of content companies.
There is an opportunity to go to market with original content that drives new customer experiences across mobile devices, social platforms and new technologies, thereby disrupting existing business models. There is a lot at stake for AT&T and it must ensure that its content is worth viewing to stand out in a crowded field of OTT providers. It would appear to be off to a good start with its Chernin partnership. The Chernin Group provides its media smarts and its majority stake in Crunchyroll, an anime streaming company, while AT&T delivers the potential for extensive distribution and access to its customer base and wireless networks.
Clearly, different and varied business models will need to be supported and monetized, whether they are advertising models similar to Google's YouTube, subscription fees like Netflix, or both advertising and subscription models like Hulu. As new partnerships and business models are envisioned, these will also have to be quickly launched and monetized at a pace not seen by carriers for traditional services.
Interested in learning more about these industry developments? Tweet us your questions!
Hiring the wrong candidate can cost a company hundreds of thousands of dollars, and result in lost profit and productivity during the search for a replacement. In fact, the Harvard Business Review has found that as much as 80 percent of turnover is caused by bad hiring decisions. But when your organization has implemented DevOps, the job is about more than just technical chops. It’s also about core behaviors: how they work with others, how they make decisions, and how those decisions translate t...
Nov. 25, 2015 12:45 AM EST Reads: 115
The Internet of Things is clearly many things: data collection and analytics, wearables, Smart Grids and Smart Cities, the Industrial Internet, and more. Cool platforms like Arduino, Raspberry Pi, Intel's Galileo and Edison, and a diverse world of sensors are making the IoT a great toy box for developers in all these areas. In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists discussed what things are the most important, which will have the most profound...
Nov. 25, 2015 12:30 AM EST Reads: 407
In today's enterprise, digital transformation represents organizational change even more so than technology change, as customer preferences and behavior drive end-to-end transformation across lines of business as well as IT. To capitalize on the ubiquitous disruption driving this transformation, companies must be able to innovate at an increasingly rapid pace. Traditional approaches for driving innovation are now woefully inadequate for keeping up with the breadth of disruption and change facin...
Nov. 25, 2015 12:30 AM EST Reads: 409
PubNub has announced the release of BLOCKS, a set of customizable microservices that give developers a simple way to add code and deploy features for realtime apps.PubNub BLOCKS executes business logic directly on the data streaming through PubNub’s network without splitting it off to an intermediary server controlled by the customer. This revolutionary approach streamlines app development, reduces endpoint-to-endpoint latency, and allows apps to better leverage the enormous scalability of PubNu...
Nov. 24, 2015 10:00 PM EST Reads: 258
People want to get going with DevOps or Continuous Delivery, but need a place to start. Others are already on their way, but need some validation of their choices. A few months ago, I published the first volume of DevOps and Continuous Delivery reference architectures which has now been viewed over 50,000 times on SlideShare (it's free to download...no registration required). Three things helped people in the deck: (1) the reference architectures, (2) links to the sources for each architectur...
Nov. 24, 2015 09:30 PM EST Reads: 178
I recently attended and was a speaker at the 4th International Internet of @ThingsExpo at the Santa Clara Convention Center. I also had the opportunity to attend this event last year and I wrote a blog from that show talking about how the “Enterprise Impact of IoT” was a key theme of last year’s show. I was curious to see if the same theme would still resonate 365 days later and what, if any, changes I would see in the content presented.
Nov. 24, 2015 08:00 PM EST Reads: 338
Microservices are a very exciting architectural approach that many organizations are looking to as a way to accelerate innovation. Microservices promise to allow teams to move away from monolithic "ball of mud" systems, but the reality is that, in the vast majority of organizations, different projects and technologies will continue to be developed at different speeds. How to handle the dependencies between these disparate systems with different iteration cycles? Consider the "canoncial problem"...
Nov. 24, 2015 06:00 PM EST Reads: 368
Culture is the most important ingredient of DevOps. The challenge for most organizations is defining and communicating a vision of beneficial DevOps culture for their organizations, and then facilitating the changes needed to achieve that. Often this comes down to an ability to provide true leadership. As a CIO, are your direct reports IT managers or are they IT leaders? The hard truth is that many IT managers have risen through the ranks based on their technical skills, not their leadership ab...
Nov. 24, 2015 06:00 PM EST Reads: 318
Discussions of cloud computing have evolved in recent years from a focus on specific types of cloud, to a world of hybrid cloud, and to a world dominated by the APIs that make today's multi-cloud environments and hybrid clouds possible. In this Power Panel at 17th Cloud Expo, moderated by Conference Chair Roger Strukhoff, panelists addressed the importance of customers being able to use the specific technologies they need, through environments and ecosystems that expose their APIs to make true ...
Nov. 24, 2015 03:30 PM EST Reads: 459
There are over 120 breakout sessions in all, with Keynotes, General Sessions, and Power Panels adding to three days of incredibly rich presentations and content. Join @ThingsExpo conference chair Roger Strukhoff (@IoT2040), June 7-9, 2016 in New York City, for three days of intense 'Internet of Things' discussion and focus, including Big Data's indespensable role in IoT, Smart Grids and Industrial Internet of Things, Wearables and Consumer IoT, as well as (new) IoT's use in Vertical Markets.
Nov. 24, 2015 03:30 PM EST Reads: 507
The Internet of Things (IoT) is growing rapidly by extending current technologies, products and networks. By 2020, Cisco estimates there will be 50 billion connected devices. Gartner has forecast revenues of over $300 billion, just to IoT suppliers. Now is the time to figure out how you’ll make money – not just create innovative products. With hundreds of new products and companies jumping into the IoT fray every month, there’s no shortage of innovation. Despite this, McKinsey/VisionMobile data...
Nov. 24, 2015 02:00 PM EST Reads: 416
As organizations realize the scope of the Internet of Things, gaining key insights from Big Data, through the use of advanced analytics, becomes crucial. However, IoT also creates the need for petabyte scale storage of data from millions of devices. A new type of Storage is required which seamlessly integrates robust data analytics with massive scale. These storage systems will act as “smart systems” provide in-place analytics that speed discovery and enable businesses to quickly derive meaningf...
Nov. 24, 2015 01:45 PM EST Reads: 338
Internet of @ThingsExpo, taking place June 7-9, 2016 at Javits Center, New York City and Nov 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 18th International @CloudExpo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo New York Call for Papers is now open.
Nov. 24, 2015 01:30 PM EST Reads: 488
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York and Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty ...
Nov. 24, 2015 01:30 PM EST Reads: 481
We are rapidly moving to a brave new world of interconnected smart homes, cars, offices and factories known as the Internet of Things (IoT). Sensors and monitoring devices will touch every part of our lives. Let's take a closer look at the Internet of Things. The Internet of Things is a worldwide network of objects and devices connected to the Internet. They are electronics, sensors, software and more. These objects connect to the Internet and can be controlled remotely via apps and programs. ...
Nov. 24, 2015 01:15 PM EST Reads: 479
Growth hacking is common for startups to make unheard-of progress in building their business. Career Hacks can help Geek Girls and those who support them (yes, that's you too, Dad!) to excel in this typically male-dominated world. Get ready to learn the facts: Is there a bias against women in the tech / developer communities? Why are women 50% of the workforce, but hold only 24% of the STEM or IT positions? Some beginnings of what to do about it! In her Day 2 Keynote at 17th Cloud Expo, San...
Nov. 24, 2015 01:00 PM EST Reads: 492
SYS-CON Events announced today that Kintone has been named "Bronze Sponsor" of SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. kintone promotes cloud-based workgroup productivity, transparency and profitability with a seamless collaboration space, build your own business application (BYOA) platform, and workflow automation system.
Nov. 24, 2015 12:00 PM EST Reads: 566
Just over a week ago I received a long and loud sustained applause for a presentation I delivered at this year’s Cloud Expo in Santa Clara. I was extremely pleased with the turnout and had some very good conversations with many of the attendees. Over the next few days I had many more meaningful conversations and was not only happy with the results but also learned a few new things. Here is everything I learned in those three days distilled into three short points.
Nov. 24, 2015 08:00 AM EST Reads: 258
One of the most important tenets of digital transformation is that it’s customer-driven. In fact, the only reason technology is involved at all is because today’s customers demand technology-based interactions with the companies they do business with. It’s no surprise, therefore, that we at Intellyx agree with Patrick Maes, CTO, ANZ Bank, when he said, “the fundamental element in digital transformation is extreme customer centricity.” So true – but note the insightful twist that Maes adde...
Nov. 24, 2015 08:00 AM EST Reads: 392
DevOps is about increasing efficiency, but nothing is more inefficient than building the same application twice. However, this is a routine occurrence with enterprise applications that need both a rich desktop web interface and strong mobile support. With recent technological advances from Isomorphic Software and others, rich desktop and tuned mobile experiences can now be created with a single codebase – without compromising functionality, performance or usability. In his session at DevOps Su...
Nov. 24, 2015 06:45 AM EST Reads: 335