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ibc_ibc 31/08/2014 13:18 Page 8 US cord cutters gobble up data indings from Global Internet Phenomena Report 1H2014, released by intelligent broadband network solutions specialist Sandvine, reveal that North American subscribers who exhibit cord cutting behaviour are dominating network usage, consuming on average 212GB a month, more than seven times the 29GB of a typical subscriber, and that in the UK and Ireland, Netflix is now the second largest source of traffic during the peak evening hours. The report contains findings from fixed and mobile networks around the world, including: On Demand Video North American subscribers who exhibit cord cutting behaviour (top 15th percentile of video users) are dominating network usage: l Consuming on average 212GB a month, more than seven times the 29GB of a typical subscriber l Viewing the equivalent of 100 hours of video each month F l Accounting for the majority (54%) of total monthly network traffic l In United Kingdom and Ireland, Netflix is now the second largest source of traffic Asia Pacific OTT to surge to $10bn Asia Pacific online TV and video revenues (over fixed broadband networks) will reach $10.19 billion in 2020; a huge increase from the $0.54 billion recorded in 2010 and $2.68 billion in 2013, according to a report from Digital TV Research. The OTT TV sector is on the brink of a huge take-off for the 14 countries covered in the Asia Pacific Online TV & Video report as key players 14 ADVANCED TELEVISION during the peak evening hours, accounting for over 17.8% of downstream fixed access traffic l The availability of high bitrate Super HD content to all Netflix subscribers in North America increased Netflix’s peak downstream traffic share from 31.6% to 34.2%. Amazon Instant Video continues to gain share, but still only accounts for 1.9% of downstream traffic Messaging l Snapchat generates more traffic than any other third-party messaging app on North American mobile networks, and on one network accounted for an astonishing 12% of total traffic on New Year’s Eve l On an African mobile network where the majority of subscribers have talk and text plans, WhatsApp accounts for over 23% of traffic due to the introduction of a low-cost, unlimited access plan for the service that is designed to drive data adoption l On several LTE networks in Asia, third- expand internationally, broadband penetration increases and as new partnerships are announced almost on a daily basis. Online TV and video advertising has been the key driver for the OTT sector, with revenues of $1.69 billion expected in 2014, up from $0.33 billion in 2010. Rapid advertising expenditure growth will continue, to reach $4.61 billion in 2020. China will contribute $1.96 billion to the 2020 total, with Japan party messaging apps such as Line or WeChat are used by over 40% of mobile subscribers each hour. Live Streaming l Twitch.TV, a live streaming service where video gamers watch each other play, has established itself among the top15 applications on many fixed networks across the globe, and now generates more traffic than HBO GO on US networks l During the World Cup, live streaming of matches is predicted to account for over 40% of network traffic on some Latin American mobile networks “Just over two years after its launch, Netflix has become the second largest driver of traffic on fixed access networks in the UK and Ireland,” said Dave Caputo, president and CEO, Sandvine. “This rapid ascent underscores how important it is that operators have business intelligence solutions in place to accurately measure and monitor the impact that over-the-top services have on their networks.” “While the app of choice varies drastically between continents and countries, this latest report makes it clear that mobile messaging matters,” said Caputo. “To remain competitive in the marketplace, mobile operators must be able to create and implement innovative service plans rapidly in order to meet the ever-changing demands of subscribers and combat declining SMS revenues.” supplying a further $1.20 billion – these two countries will provide two-thirds of the region’s total. Online television and video subscription revenues (SVoD) will soar from $110 million in 2010 to $1.272 billion in 2014 and onto $3.493 billion in 2020. Japan will lead the SVoD sector by a long way, with revenues of $1,927 million in 2020 – or 55% of the region’s total. Online TV and video rental/pay-per-view revenues will expand rapidly, climbing from $36 million in 2010 to $804 million in 2020. Downloadto-own revenues are forecast to be $1,283 million in 2020, up from only $58 million in 2010. The number of homes paying a monthly subscription to receive SVoD packages will climb from 2.27 million in 2010 (0.3% of TV households) to 14.49 million by end-2014 (1.8%) and onto 53.41 million in 2020 (6%).