This article originally appeared in the Dec. 2012 issue of Next Gen Mobility Magazine.
4G LTE (News - Alert) networks have created the opportunity for mobile subscribers to decide whether or not they really need their fixed broadband network connections. Mobile broadband connection speeds available before 4G LTE were not comparable in terms of bandwidth to fixed broadband networks. Today, we are seeing that mobile data bandwidth has increased dramatically to the point where it can realistically eclipse fixed broadband connections that are typically accessed through a local Wi-Fi network.
I have experienced speeds of up to 55mbps on my mobile smartphone, but speeds top out at around 25mbps when using my Wi-Fi access point at home that is connected to a fixed-line network. So from a bandwidth perspective, it is clear that bandwidth would not be an issue if I were to totally rely on mobile broadband data services. The issue with switching to mobile would be the total cap, or limit, set on data consumed per subscriber per month. For fixed line broadband service, this limit can be upwards of 250 GB per month whereas mobile data caps average 4 GB.
These lower cap mobile plans would be adequate for a usage profile including e-mail, messaging, social networking and Internet browsing but not for streaming video and audio using high quality codecs. By simply watching 15 minutes of 1080p resolution video programming, video streaming can exceed the 4 GB mobile data plan limit. If you are watching several hours of video in the evening, or streaming high quality audio while on a long commute, then relying only on your current mobile data plan for these activities will definitely impact your budget as mobile data caps are exceeded. IDC (News - Alert) forecasts that worldwide streaming video and audio traffic will grow from 46 percent of total mobile traffic in 2011 to over 60 percent in 2015, so it’s clear that video streaming will continue to represent a major component of mobile data usage.
One way that mobile service providers can address the increasing demand for streaming media content and provide an economic alternative to fixed lined data services is to offer their subscribers the ability to stream over-the-top video and audio content for a specified number of hours per month without impacting their base plan data quotas. This streaming plan could be charged for in addition to a subscriber’s base data plan, thereby creating incremental revenue streams for mobile operators.
This service approach can be implemented by using deep packet inspection technology to track how much media content is being streamed by individual subscribers, in accordance with policies that intelligently enforce the details of the streaming plan chosen by the mobile subscriber. These policies can include: limiting the number of hours of media streamed per month by content type (for example video versus music) at any time; enabling streaming only at a particular time of day or day of the week; allocating bandwidth depending on the resolution of the mobile device; or zero rating streaming for late night video viewing.
For mobile service providers to monetize video in this way does require a shift in their thinking from a usage-based to a value-based pricing model that essentially encourages mobile OTT streaming. Value-based streaming plans can match subscribers’ usage patterns to pricing based on their streaming usage profile. Generating detailed analytics from DPI platforms is critical for service providers to profile subscriber streaming usage in order to define and tailor streaming plans that are profitable and match existing consumer behavior.
I am not, however, suggesting that mobile subscribers will move en masse away from fixed-line broadband networks if mobile data plans can more economically accommodate increased video and audio streaming. With the advent of 4K resolution TVs, so called Ultra High Definition, even more bandwidth will be needed from fixed-line broadband service providers that will likely occur just ahead of bandwidth improvements made in mobile broadband speeds.
Right now, mobile service providers are consumed with enhancing their appeal by deploying 4G networks that are an order of magnitude faster than 3G networks. 4G LTE networks, in particular, accomplish this while reducing per-subscriber costs. Video aside, mobile operators are driven to deploy LTE networks to improve their profitability and broadband capacity. Monetizing video by offering value-based streaming services using intelligent policy enforcement represents a huge opportunity for mobile service providers to increase average revenue per user and fund their 4G expansions. So I say, “caps off” to mobile service providers –deliver service plans that consumers can associate with tangible value – giving them a reason to cut the fixed broadband network cord.
Ken Osowski (News - Alert) is director of solutions marketing at Procera Networks (www.proceranetworks.com).Ken Osowski is director of solutions marketing at Procera Networks (News - Alert) (www.proceranetworks.com).
Edited by Brooke Neuman