The Rise of Online Video Consumption
8 September 2014
My first experience of consuming mobile data was with my first mobile phone, a Nokia 3510i complete with colour screen and polyphonic ringtones – but unfortunately, no Snake game.
Thankfully, the mobile internet space has developed a lot since then and these days using mobile devices to access the internet is for most people, an essential part of daily life. The continuing rise in demand for data and speed is evident in figures published by Cisco for the next 4 years with mobile devices set to outnumber people by the end of 2014; the demand for connectivity will drive mobile data usage.
Global mobile data traffic grew by 81% in 2013 reaching 1.5 exabytes of data per month compared to 1 exabyte of data for the entire year in 2000, highlighting massive demand for growth within the global mobile data space. To support this, over half a billion mobile devices and connections were added in 2013 alone growing to 7 billion with smartphones worldwide, accounting for 77 percent of this growth.
The main use of data is focused around video, accounting for around 53% of all data consumed and this figure is set to rise to 69% by 2018, this may be partially down to the prediction that 54% of devices will be smart devices by 2018; an increase of 21% on 2013 figures or it could also be attributed to by the rise in demand for faster connectivity, with 4G becoming more accessible for many people figures have shown that even though only 2.9% of connections utilise 4G, they made up 30% of all mobile data traffic in 2013. By 2018 it is predicted that 15% of connections will utilise 4G with these connections accounting for 51% of the total global mobile data traffic.
Separately, in a report published in September 2014 by Citrix over half of data usage by mobile subscribers comes from viewing any type of video and long-form videos are showing rapid growth due to the widespread roll-out of 4G networks. 81% of this traffic goes to popular video portals such as Netflix, YouTube and Google Video with the two latter two platforms being most popular with subscribers. With the increase in adoption of 4G consumers will be 1.5 times more likely to watch long-form content from the likes of Netflix and away from shorter videos found on the likes of YouTube shown by a spike in the amount of people utilising Netflix on the go.
This increasing demand for data poses a problem to operators – how to keep churn rates down with limited network capacity. Because of the expected rapid increase in demand and paired with the increase in data usage for video, operators face promising a lot and giving little to their consumers which may result in high churn rates and high cost to the operator if they do not take action.
SLA mobile can help mobile operator’s monetise on the demand for video content through mobile devices which in turn will help to reduce churn. We have the ability to connect video on demand companies to mobile operators through Direct Operator Billing which means that both parties can create new revenues streams by allowing the user to charge the purchase to their monthly phone bill or prepaid credit. This means the user experiences a seamless and secure payment option, whether it is for single transaction or a subscription, which enables them to conveniently watch video on the go.