[Informa]: Where is the Money in Growing Streaming Video?

A recent research by Guillermo Escofet (pictured), Senior Analyst, Informa Telecoms & Media finds that "Streaming has become the most popular way of consuming video on phones. But not in the way operators had hoped for – through their mobile TV offerings – but through user-generated video clips on free video-sharing sites, primarily YouTube .. No direct end-user revenue is generated from most mobile-video streaming, yet it is the single biggest drain on cellular-network capacity (if all cellular-connected devices are included)".

"Informa nevertheless expects that the opportunity for monetization in video streaming will grow as more paid-for VoD, TV streaming and locker services enter the market. Video-streaming traffic is predicted to increasingly yield more direct end-user revenue, even though most usage will remain free. As fig. 3 shows [below] , revenues will grow at a faster rate than users"

"Some operators are continuing to launch services in this space, however. Spanish incumbent Telefonica, for example, in January extended its DSL-pay TV service, Movistar Imagenio, to mobile via the Imagenio Movil app on BlackBerry devices. Integrated with the BlackBerry’s instant messaging service, BBM, the app streams live content from more than 20 TV channels at a starting price of €2.50 (US$3.26) a month". 

"In Canada, meanwhile, operator Rogers Wireless also extended its digital TV service to mobile with an iPad app that includes 20 channels, streamed for free to selected customers".

See "Video will hog a third of handset traffic but earn less than 1% of end-user mobile data revenue" - here.

OVUM: Shared Data Plans are "here to stay"; Require Management Tools

 
Nicole McCormick (pictured), Senior Analyst - Telco Strategy, Ovum covers the recent adaption of shared data plans by major MNOs.

"After a significant amount of discussion and hype, “bucket plans” are beginning to gain traction around the world. Bucket plans are a tariff structure where a monthly data allowance is shared between all of a user’s connected devices"

"Telefonica, Canadian operator Rogers Wireless, Hong Kong operator CSL [here], and Norway’s Telenor are just some of the growing number of operators that offer data bucket plans. These plans are typically aimed at the “connected person” who owns a smartphone, laptop, and tablet".

Related posts:

• Verizon Wireless Adds Shared Data Plans (1-10GB) - here
• [Gartner]: "CSPs should adopt these multidevice plans- here 

See also "Shared Mobile Data Plans Savings Opportunities at A Cost" (here) for more examples: Bell Mobility[Canada], Orange Mobistar and Proximus [Belgium], Vodafone and Telstra [Australia],Orange Austria and Vodafone Ireland.

 

Source: CSL/one2free 

Back to Ovum - "Bucket plans provide operators with significant cost savings as they do not have to acquire and manage two separate subscriptions for a single customer. A combined account also makes it far easier for operators to find out what a customer is using their device for and when. This information makes upsell opportunities clearer and easier to implement, and enables the possibility of providing the data to third-party applications and advertisers .. Unified plans increase customer stickiness, which results in lower churn".

 

"Operators will also have to ensure that bucket plan users are provided with adequate data monitoring tools to prevent excess usage charges if big-screen devices unknowingly consume a high proportion of the bucket. These should also provide a mechanism that enables customers to upgrade to a larger plan if required" (see also "Infonetics: Shared Data Plans - an Opportunity with OSS Needs" - here).

  

See "Data buckets arrive to cater for the “connected person” - here.

Rogers Stops DPI/Traffic Management; Cisco: "there have been very few cases of misclassification"

 
For several months now, Rogers is facing resistance against its traffic management policy enforcement, as it misclassifies some non P2P file sharing traffic as such. This comes from interested parties (Canadian Gamers - here) and, more importantly, Canada's regulator, the CRTC (see "CRTC to Rogers: We Know what you are doing ..!" - here and "CRTC to Rogers: Fix your DPI System!" -here).

It turns out the Rogers decided to give up on traffic management enforcement (this follows a similar step by Bell Canada - here). So either the problem is too complicated for Cisco to solve, or there is no longer a business justification to manage P2P file sharing traffic.

In his letter to the CRTC, Kenneth G. Engelhart, SVP Regulatory (here), says that:  

• First, it should be noted that very little traffic is affected by the traffic management of unidentified traffic on peer-to-peer file sharing ports. Rogers has conducted a test of real world traffic and determined that only .005% of real world traffic falls into this category. In other words, 5 one thousandths of 1% of real world traffic is not classified by the Cisco software and is on peer-to-peer file sharing ports
   
• Nonetheless, out of an abundance of caution and to allay any concerns which the Commission’s investigation may have created, we have reconfigured the Cisco equipment so that the unclassified traffic on peer-to-peer ports is no longer traffic managed.
   
• In addition, we have been reviewing our traffic shaping policy for several months. New technologies and ongoing investments in network capacity will allow Rogers to begin phasing out that policy starting in March 2012. These changes will be introduced to half of Rogers existing Internet customers by June 2012 and to its remaining customers by December 2012.

Rogers added a letter signed by Larry Chang (pictured), VP engineering Technology, ERBU stating that "there have been very few cases where traffic has been misclassified as peer-to-peer file sharing traffic". 

CRTC to Rogers: We Know what you are doing ..!

 
Back in October, the Canadian regulator, CRTC, asked Rogers, the cable operator, to fix its DPI system, as it confuses games with P2P file-sharing (see "CRTC to Rogers: Fix your DPI System!" - here).
 

This is not over yet, and the CRTC had to send another letter (here), this time by Andrea Rosen (pictured), Chief Compliance and Enforcement Officer.

".. Based on the preliminary results of our ongoing investigation, Commission staff is of the belief that Rogers Communications Inc. (“Rogers”) applies a technical ITMP to unidentified traffic using default peer-to-peer (“P2P”) ports. On the basis of our evidence to date, any traffic from an unidentified time-sensitive application making use of P2P ports will be throttled resulting in noticeable degradation of such traffic .. Within two weeks, I look forward to you either presenting us with a rebuttal of our evidence or providing us with a plan to come into compliance with the Act".

From the "Summary of Evidence":

".. As Cisco is Rogers’ vendor, the Compliance and Enforcement Sector had and continues to have tests conducted against information from the website of Cisco Systems, Inc. (“Cisco”). Preliminary testing results indicate that unidentified traffic using default P2P ports, as identified in the Cisco SCA BB Protocol Reference Guide is throttled. Such results further indicate that:

• default P2P ports for TCP traffic are subject to throttling, except port 6969, and
• until December 20, 2011, all default P2P ports for UDP traffic were subject to throttling"

Infonetics: Shared Data Plans - an Opportunity with OSS Needs

    

A research paper by Infonetics (commissioned by Tekelec- see press release here) concludes that

"Shared data plans represent a prime opportunity for operators to reduce churn, drive device adoption, and generate more revenue than they have been able to from individual subscriptions—provided they are executed correctly"

Similar view was presented by Sandvine's CTO (here).

 

Infonetics presents "A few public announcements from major mobile operators":  

• Orange Austria, France, Spain: Since Spring 2011, Orange has been offering two devices per data plan, bundling 600 minutes, unlimited texts, unlimited BTZone WiFi access, and 2GB shared data across both devices—iPad and iPhone are named specifically as available devices; cost is £99/month at 16GB rate.
    
• Vodafone Ireland offers shared mobile broadband for business users with a 5GB limit, shared across however many users is required, for a fee of €7.50 per connection per month, with each additional increment of 5GB being another €10.
    
• Optus offers a plan connecting five users each on a 4GB shared plan, with 20GB of data pooled between those five users each month; in addition, if the subscriber has a mobile connected to a Business Mobile Advantage plan, she will be able to share even more data across the account.
   
• Rogers Wireless offers various plans: 1GB + unlimited social networking to seven popular sites for $30/month; 4GB + unlimited social networking to seven popular sites for $50/month; options to add an additional 1GB for $15/month or to add voice.

Of course, this doesn't come for free (for the operator) - the OSS has to support this - "solutions such as policy, subscriber data management, charging, and Diameter routing. Flexible, real-time capabilities in the control plane are the key success factor to the successful implementation of these new service models"

Shira Levine, directing analyst, next gen OSS and policy, Infonetics says - "Shared data plans — whether across multiple devices for an individual or across multiple subscribers — demand that operators rethink their operational systems. Service providers cannot offer must-haves like parental controls, time-of-day management and application-based rules without advanced policies and subscriber intelligence".

In order to meet the performance challenges such complex system is facing - ".. the number of signaling transactions increases exponentially .. operators will turn to Diameter routing agents (DRAs) to better manage the onslaught of Diameter messages exchanged among network elements"

The paper "All in the Family: The New Requirements of Shared Data Plans" is available here.

Game is not Over: Canadian Gamers vs. Rogers' DPI

  

The debate in Canada over Rogers' traffic management and DPI problems is not resolved yet. Although Rogers admitted to have  issues with its classification and policy enforcement actions in March (here) and was ordered by the regulator, CRTC, to fix it (here), the Canadian Gamers Organization (CGO) is not happy yet. 

Several quotes from the letter sent by CGO to the CRTC last week, related to the classification and rate-limiting policies, are shown below (see the full text here).

All-in-all, it shows the complexity of implementing a scalable policy enforcement structure, that will allow the ISP to implement its commercial goals, to millions of users with combination of policies controlling "real-time (VoIP, gaming)", "jitter sensitive (streaming video)", "normal" and "bandwidth hogs" applications. 

  

Until this is done correctly, it will be very difficult to market premium "QoE based tiered services".  Nevertheless, referring to yesterday's post on standalone vs. embedded DPI solutions (here) - it seems that standalone products are much closer to implement this strategy.

• .. Yet it is apparent from Rogers’ letter of September 2 that other applications and games are being misclassified by its ITMP and pushed into this rate limiting channel... Rogers states openly in its September 2 letter that World of Warcraft and unspecified “other games” are diverted to this rate-limited channel by its DPI. This would be consistent with reports the CGO has received recently from our members. It means anything running above 80/kbps with file sharing applications running is being actively impacted and misclassified by Rogers ITMP
   
• Even if games or other applications ran below the 80/kbps threshold individually; if they were running simultaneously that combines upload traffic to exceed 80/kbps with P2P applications running, they would also be impacted by Rogers ITMP from what Rogers has disclosed to the commission.  Rogers’ ITMP is activated “for traffic at 80 kbps and above”, and through Rogers disclosure is only active when P2P file sharing applications are open. As the commission well knows, Canadian consumers can have several gaming systems, wireless devices, and PCs hooked up simultaneously in any given home network set up.
   
• Further, CGO wishes to submit that not all games run below 80/kbps.  World of Warcraft is an older game, and since development and release of this game, newer games are increasingly becoming more sophisticated requiring much more bandwidth. World of Warcraft recently updated to provide a setting to users which would make the game server respond faster to user actions, but at the cost of the user's upstream bandwidth increasing.  World of Warcraft also has a built-in VOIP for in-game team chat on top of regular game data transmitted to developer’s servers and to other peers on the network, however the bulk of World of Warcraft users prefer to use alternate VOIP solutions (due to better sound quality/voices being much clearer), which can be additionally taxing on the upstream bandwidth.
    
• The developers of the game Homefront,  for example, state it requires users to have consistent upload traffic between 100 - 120/kbps in order for the game to run smoothly with a direct connection to their servers, stating that most lower end DSL connections in the US support upload of 768/kbps. 

 

CRTC to Rogers: Fix your DPI System!

   

6 months ago, Rogers admitted that its "traffic management equipment that can interfere with World of Warcraft .. We have determined that the problem occurs only when our customers are simultaneously using peer-to-peer file sharing applications and running the game"  - see "Rogers [Canada] Admits its P2P Traffic Management Impacts Interactive Gaming" - here.
 

      

Now, the CRTC has instructed Rogers to fix the problem. In a letter that was sent on Friday to Rogers,  (here, from DSPreports.com), John Traversy, Executive Director, Telecommunications says: "Commission staff notes that in its report entitled World of Warcraft Testing, dated 25 July 2011, Rogers indicated that it had implemented a “whitelisting” solution to resolve issues related to misclassification of this specific game. Based on information provided by Rogers’ 2 September 2011 letter, as noted above, Commission staff considers that Rogers’ ITMPs could potentially continue to misclassify time-sensitive traffic such as other online games and therefore this could be affecting those games. Commission staff considers that Rogers should address and resolve this misclassification problem As a result, Commission staff requests that Rogers file a plan for resolving the possibility of misclassification of other interactive game traffic, by 27 September 2011, that includes specific steps and timelines for each step". 

Tekelec: Policy Management Business Cases (AT&T, Vodafone and Others)

  
A recent presentation by Tekelec shows the business case, with named examples (customers?), for using policy management:

• QoS based tiers: Vodafone
      
• Volume based tiers: AT&T - "If all subscribers moved to AT&T’s new tiered data plans, the company could have lost over $42 million per month. This was more than offset by the addition of 3.2 million new iPhone users in Q3 2010 when tiered services were introduced."
   
• One customer, many devices: Rogers
   
• Casual usage and loyalty program: - Claro, Telecom New Zealand, Vodafone Germany
   
• OTT Monetization

See "Four Use Cases for Monetizing Mobile Broadband" - here.

See also "Tekelec: Policy Management Use-cases, Deployments and Performance" - here,

Easy to Use Cloud Backup Maybe Expensive!

  

A new class of applications may be added to the list of "bandwidth hungry applications", in addition to usual suspects - P2P file sharing and video streaming. The story below shows how cloud based backup services may also consume enormous amounts of bandwidth. DPI vendors - please take care! 

A month ago I covered an article by Mathew Ingram (picture) to Gigaom, describing how he tried to locate what was consuming hundreds of Gigabytes per month on his Rogers home service (see "Every [Canadian] Family Needs a CIO" - here).

Now, Mathew published the sequel - this time with the exact reason - showing how user friendly services might cost the subscriber (in his case, when you have a metered service):

"Then a day or two ago, I got an email from Amazon with the bill for my Amazon AWS service. I have about 25 gigabytes of photos, music and other documents backed up to Amazon’s S3 server cloud, which usually costs me about $3 a month — but this time, the bill said $109 .. The culprit, apparently, was either Windows indexing the files or an anti-virus program scanning them, or both. Since JungleDisk [see the chart for its "bandwidth Limiting Function"] maps the Amazon cloud folder as a network drive, Windows and some other programs simply treat it as a regular drive and download all the files to scan them — even multiple times"

See below Amazon's "Data Transfer Pricing" information.

See "What Happens When the Cloud Meets a Bandwidth Cap" - here.

Every [Canadian] Family Needs a CIO

  

Read about the case of Mathew Ingram (picture), a journalist that became an IT manager in his household trying to detect how his home network consumed 95 GB in 6 days or 100 GB in two days leading to overcharge fees by his ISP - Rogers. 

Posted to Gigaom - "How Bandwidth Caps Force Us All to Become Network Cops" - here.

See also the long story of Usage based Billing in Canada - start here, and "Rogers [Canada] Admits its P2P Traffic Management Impacts Interactive Gaming" - here.

Rogers [Canada] Admits its P2P Traffic Management Impacts Interactive Gaming

   

In a letter to the Canadian Regulator, CRTC, Rogers says that "Our tests have determined that there is a problem with our traffic management equipment that can interfere with World of Warcraft .. We recently introduced a software modification to solve the problems our customers are experiencing with World of Warcraft. However, there have been recent changes to the game, which has created new problems. A second software modification to address these new issues will not be ready until June .. We have determined that the problem occurs only when our customers are simultaneously using peer-to-peer file sharing applications and running the game".

See the letter, posted to openmedia.ca, site - here.

According to Roger's Network Management Policy [here]:

"Rogers manages traffic associated with certain P2P file sharing protocols for customers of Rogers Hi-Speed Internet (delivered over cable) and Portable Internet from Rogers. We use packet inspection to determine the type (but not the content) of upstream traffic only. High-volume, low time-sensitive traffic (such as P2P file sharing) is limited to ensure all customers have a high level of service for time-sensitive tasks like sending email, requesting web pages, video and voice applications. For Rogers Hi Speed Internet (delivered over cable) and Portable Internet from Rogers customers, the maximum upload speed for P2P file sharing traffic is 80 kbps at all times. There are no limits on download speed for any application or protocol .. Rogers does not manage download P2P file sharing traffic; however, some P2P applications will limit download speeds based on various factors, including the amount of P2P upload traffic and protocol acknowledgments. These factors may be responsible for customers experiencing slow download P2P file sharing speeds.."