Mobile Musings

March 07, 2012

Monetizing Mobile Video - What Carriers Need to Succeed

This article originally appeared in the Feb. 2012 issue of Next Gen Mobility

Device manufacturers and carriers are touting the quality and speed of their offerings. They advertise how fast movies and videos can be downloaded, the quality of video streaming, and the sharpness of video quality. Meanwhile, television networks and other content providers are promoting the convenience of video on demand. Together, this provides an expectation among consumers that not only will they be able to view everything from football games to their favorite shows wherever and whenever they want, but that the experience will be similar to watching the same content in real time as it originally aired.

 Research Shows Internet Device Growth

Such an expectation helps drive sales of Internet video-enabled devices, such as iPhones, iPads and Android (News - Alert)-enabled devices. Robust sales of these and other similar devices strongly reflect a willingness among consumers to pay a premium for mobile devices that provide access to high quality video, on demand.

With the costs and commitments made by consumers, there will be an accompanying expectation of exceptional quality. This is different than when mobile phones were first introduced, as back then consumers were willing to accept the occasional dropped call or poor quality transmission in exchange for the previously unattainable convenience of mobility. Now quality does matter, and with the choices available and the fast-paced, well-publicized advances in technology, many consumers simply will not settle for anything less than top quality.

Customers Will Pay a Premium for Quality

According to research from Alcatel-Lucent (News - Alert), many consumers are not only willing to pay higher prices for the latest mobile devices, they are also willing to pay for premium content on the devices. But with this comes added focus on whether the consumers are getting all the features they were promised and paid extra for, especially with respect to video.

By focusing on premiums for better quality, providers can position themselves to entice consumers with new high quality service offerings. Additional revenue from high quality video services will in turn enable providers to enhance their average revenue per user and reduce customer churn. Broadband customers will pay for higher quality, and consumer demand for higher video quality is poised to grow with the proliferation of professional content.

New Measurement Paradigm Needed

Traditional methods of measuring video quality typically have focused around QoS, and usually involve some technical measure of network performance. These methods may have been state of the art in the past, but in today’s environment, they can be inaccurate from a customer point of view.

What matters is perceptual quality. The consumer wants video transmissions that he or she perceives to be of the best quality, regardless of what a network-based statistical measure may conclude. It is the typical discussion of features versus benefits. Customers want the benefits of features, not necessarily the features themselves.

To measure perceptual quality, the focus shifts from quality of service of the network to quality of experience of the user. Whatever the content or setting, whether sporting events being viewed live or in the form of video highlights, on-demand programming, or video-based advertising, consumers are demanding high quality video. The crux of a QoE solution is to identify a specific piece of video content and track it as it is transmitted through the network, perceiving quality as the human eye would and assigning higher importance to things (e.g., motion) to which the human eye is naturally attracted and lower importance to areas less likely to be noticed.

Overall, better measurement of perceptual quality enables video content providers to quickly identify, isolate and correct issues so that they can deliver the quality video that consumers expect. At the same time, by offering a variety of high quality video services, content providers can charge higher subscription fees and enhanced advertising rates while still adhering to service level agreements. Perceptual quality measurement may just be the key to success when it comes to mobile video monetization!

Jim Machi is senior vice president of marketing at Dialogic (News - Alert) Inc. (

Edited by Stefania Viscusi

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Rich Tehrani,
Since 1982 Rich has led TMC© in many capacities. Rich Tehrani is an IP Communications industry expert, visionary, author and columnist. He founded INTERNET TELEPHONY® magazine...Read More >>>
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Today as a partner at Crossfire Media, Carl is developing programs that bring to light an understanding of the issues required for delivering broadband wireless Internet...Read More >>>
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Paula Bernier,
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om is executive technology editor for TMC® Labs, the industry’s most-well known and respected testing lab, and ...Read More >>>