Ovum has a team of senior analysts attending this year's Broadband World Forum (BBWF 2016), on October 18–20, VR & AR World on October 19–20, and Apps World on October 19–20, all at ExCeL, London. We are chairing and moderating a number of sessions across the three days and will be discussing the latest industry trends, market challenges, and opportunities. Ovum's industry insights are founded on our extensive portfolio of five-year forecasts, including those for wearables, smart home, and VR and combined forecasts for fixed, mobile, and pay-TV services. Contact us to find out more.
The technical demands of enabling great VR video experiences was a hot topic across both days of VR & AR World, and with good reason: VR video will pose unprecedented challenges to companies across the value chain.
Ovum forecasts that there will be nearly 340 million VR headsets in use in 2020 – that's 60 million more than all the Apple TVs, Google Chromecasts, Amazon Fire TV Sticks, and other media streamers out there at that time. And video – not gaming – will be the most-used form of virtual reality content, overtaking games in terms of consumer spend in 2019.
True, most people will use their headsets to snack on small chunks of content rather than binge-watching for hours, but VR will pose a different challenge. The need to avoid "glitches in the Matrix" means VR video experiences need to be convincing (i.e. ultra-high resolution), consistent (i.e. little to no buffering), and coherent (i.e. ultra-low latency).
Although most of today's VR videos for smartphone-based headsets are rendered in standard HD, Facebook's Oculus Rift and HTC's Vive already support 2K per eye and 90 frames per second. Such dedicated VR devices will probably move to 4K per eye and 120fps – that's 32 times more demanding than HD.
Ultra-low latency will be particularly important. If the video fails to keep pace with the headset's movement – and we're talking less than 20ms here – then the user can quickly become disoriented and even nauseous.
Operators and vendors at VR & AR World discussed a number of radical solutions. These included video transcoding that only processes what the user is looking at, right down to the movement of their eyeballs; a major rethink of the content delivery network (CDN) technology that has supported the vast majority of online services since the turn of the millennium; and a move away from the Internet's fundamental networking protocol, TCP, toward ones more fit for purpose.
Compared to previous innovations in online video delivery, implementing these will require unprecedented collaboration across content providers, distribution platforms, network operators, infrastructure vendors, and device manufacturers.
In the meantime, the industry will have to do its best to make best-effort delivery work. As one speaker remarked, most consumers will still roll with low-quality VR video, provided the underlying content is good enough to keep them watching.
Getting that balance right will be much more precarious than it is for standard OTT video. To paraphrase a studio executive, the problem with VR is not only that you can make bad content; you can make bad content that makes people feel physically sick.
Tuesday's BBWF 16 session, Connected TV & Entertainment and Quad Play, was essentially about the ever-growing need among video content service providers for service integration in order to deliver the requisite QoE that is becoming such a key differentiator. All of this entails video transformation of the broadband networks that deliver these services to the consumer.
While multiscreen experiences require improvements in Wi-Fi coverage as well as more ubiquitous access to 3G and 4G data, network operators must also be mindful of the need for content caching and the benefits of using CDNs to ensure fast delivery of video to connected devices. BT believes that despite huge mobile growth, the majority of high-bandwidth video consumption will remain within the home, with unicast streams, trick-play features, and increasingly 4K content accounting for a large and growing proportion of network traffic. Meanwhile, as the lines between mobile and fixed content services become increasingly blurred, and with traffic growth expectations on both fixed and mobile access networks, Huawei highlights the need to offload the growing burden on the backbone – arising from storage and unicast streaming in particular – by pushing content closer to the edge of the network.
Integration isn't just about seamless transition between fixed and mobile UIs (highlighted by Proximus) or navigation experiences. Both BT and Liberty Global, as well as Huawei, cite the benefits of integrating third-party services such as Netflix into the operator's service environment. In particular, single login for access to services from multiple sources and unified billing were highlighted as key requirements for ensuring a good customer experience. Again, the route to such tighter blending of experiences appears to lie within the path of network video transformation, with browser-based, next-generation set-top boxes cited as a key facilitator of third-party video service integration.
After years of discussion, FMC is moving beyond just talk to actual deployments.
While there is little consensus around a definition for FMC, several service providers are implementing unified IT operations and analytics while others are focusing on unified customer connectivity. Ovum argues that FMC requires breaking down the silos between fixed and mobile throughout the organization, from marketing to customer care and from next-gen access planners to big data analytics.
Several operators have approached FMC by providing seamless broadband connectivity to customers, enabling higher bandwidth for Internet connectivity through Wi-Fi networks while keeping voice calls on 3G. Other operators are combining mixed wired and wireless technologies to connect the rural unconnected or to improve bandwidth during peak hours. Still others are focused on unified customer care and OSS/BSS, often requiring complete replacement of CEM and IT systems.
Ovum believes that the overriding goal is simple – to bring value to customers regardless of the underlying network architecture and customer billing and support systems.
ZTE took to the stage at BBWF 2016 to unveil the ZXV10 B860H, the company's first Android set-top box (STB). Running a high-performance quad-core SoC, the STB supports 4K UHD at 60fps as well as the HDR10 and HLG HDR standards. The B860H also comes fully integrated with ZTE's Smart Home Services, including Multi-Screen, HD Video Call, Family Album, Home IoT Network, and Voice Assistant.
ZTE joins a growing list of high-profile STB manufacturers producing Android STBs, including Vestel, Comigo, and Kaon Media. Such devices provide full access to the Google Play Store, substantially reducing their time to market, and come equipped with Google Cast, enabling consumers to stream content via their tablet or smartphone.
As a result, Android STBs are proving to be a popular choice among telcos and pay-TV operators, with Telecom Italia, Free, Omantel, and MTS Belarus already selecting the devices, and Ovum expects an increasing number of service providers to opt for Android STBs in the coming months.
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