Coming Soon: SIMS and eSIMS in Smart TVs and Set-Top Boxes

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Those who have read my columns in Streaming Media know that I like to cast stones far into the future. Looking back at the very first presentation I gave at Streaming Media Europe in 2002, when I launched my own CDN in the UK (and when I had longer hair), I was pleased to discover that I could still have used the same slides and presentation this week as I chair CDN World Forum in London. Much—if not all—of that foresight and vision has remained clear for nearly 15 years.

I was pleased that I had clarity of vision, and could see where the industry was heading, despite the fact that in 2002 I felt pretty isolated in my beliefs.

Time passes. Now in 2016 I feel very much an old-timer in a much more established streaming media sector. However the broadcast industry still thinks streaming is very new. Just recently IBC made announcements that Martin Sorrell, CEO of advertising and PR firm WPP, thinks that "GAFA"—Google, Apple, Facebook, and Amazon—will be the big disruptors in the video space. Have they not been disrupting for a decade or more? Come on, Martin, where have you been man??!

Still, we hear significant announcements when a rights owner does an online deal; these days, it's still far more newsworthy than comparable deals with traditional networks. Somehow this feels disconnected with reality. Have these analysts not got children? Have they not seen how "kids" under 40 spend their time engaged with unicast content tailored to their own tastes and ubiquitously accessible?

It bothers me that the major investors in this area are still so change-resistant, even long after the change has occurred. It is like watching climate change deniers cling to fossil fuels so they can continue to line their pockets.

Anyway, let me not uses this space to shake my head at the luddites; let me instead propose a new vision.

Even in 2002 I had been working with streaming technologies for five or six years. In those very early years the telcos were beginning to see the signs of the internet being valuable. Phone lines had been used for voice calls for several decades. The International Telecommunications Regulations had liberalized "information services" in 1988 - when such services were considered to be "noise" against a backdrop of "minutes of voice conversations." Even into the millennium, dial-up internet access was charged for by the minute, using voice lines to facilitate the last-mile connection.

However, as competing dial-up ISPs commoditized their pricing and introduced flat-rate "always on" internet access, they started to run out of options for maintaining value on those vast last-mile copper networks.

So into the mix came first ISDN—offering a faster connection to the dial-up network (near-instant PPP session initiation), then bonded ISDN, which provided domestic users with (relatively) fast internet speeds of 128Kbps or even 256kbps, and ISPs realized that large video and multimedia content was a great driver for the uptake of such services. So DSL took off, introducing yet faster and faster speeds, allowing the voice minutes-based sales model on the last-mile copper networks to gradually be replaced with broadband speed model that persists today. Since the lines could support both, the telcos started calling this "dual-play" service.

Over in the cable industry, where the networks in the ground were less pervasive, but had much higher speeds, the cable operators started to implement first voice services, and then cable broadband services, introducing the concept of "triple-play" as their main subscriber billing line items amd diversified from cable TV to include internet and voice services.

The much larger telco networks then began to explore adding IPTV in a walled garden model. Many struggled, not because of the particular challenges of providing services, but the challenge of providing ubiquity of service over such expansive networks.

By the time on-demand content became available on both cable and telco networks—the so called quadruple play model—many others sources of video had entered into the space through the over-the-top (OTT) model (where their paywall or ad revenue was outside of the cable companies' or telcos' reach).  

And today we see new models emerging where operators (cable companies and telcos that deliver the last mile connections) are partnering with OTT providers to host their content inside their networks, despite the paywall being outside, with the leading example being Netflix.

Since the operators have large subscriber networks, such immediate access to these large markets is an ideal upsell opportunity for partnership with OTT publishers since, while technology is now relatively easy to setup and many of the challenges are now solved, the publishers have done the really hard bit, which is to negotiate rights.

So why recap all of this?

Reports are now abundant that show that mobile internet access is surpassing wired internet access. There are too many to cite, and there is no point in looking at any particular statistics set, however it is clear that the trend is toward mobile. While obviously pricing models may restrict how much of this access is cellular (as opposed to Wi-Fi through a wired connection in a specific location) it seems inexorable that mobile providers will gradually offer packages that enable even poor millennial students to consume sufficient content—video included—to become loyal customers.

While much younger than wired networks, architecturally mobile networks are typically more modern, more homogenous, and therefore easier to upgrade than wired networks. Typically the customer premises equipment is a handset or tablet, and often upgrades for these are paid for by the customer with no installation overhead from the operator, unlike routers and home-gateways. The core networks are typically simple hub-and-spoke topologies. The Radio Access Networks (RANs) are moving to software-defined Mobile Edge Computing (MEC) architectures rapidly, which means new capabilities can be rolled out with extremely high service velocity.

Mobile networks universally have to-date only evolved as far as offering voice minute and internet "dual-play" models, but with technologies such as LTE Broadcast and MEC becoming reality, the spectrum challenges facing mobile operators who want to offer more and more video are being well addressed.

Given that IP content delivery networks as a whole (wired and mobile) have much higher service velocity than traditional broadcast networks, it is they who are leading the way with 4K deployments.  Now—and here is where the long-term projection comes in—why would anyone want 4K on their smartphone? Isn't the screen way too small?

I predict that as eSIM technology takes off in the mobile market (which it will, because it is cheaper to deliver than the traditional SIM) with that will come eSIM connectivity in larger-screen devices, and devices connected to larger screens such as Roku, Amazon Fire Stick, and Apple TV.

Over time it seems inevitable that the millennial will wonder why they should have a wired connection tethering them to a specific location, when their mobile operator can deliver comparable service to a device that they can move from location to location. Many students, for example, may move residence halls at university or from home to rented accommodation many times over the course of their studies. For this reason, the convenience and flexibility of mobile services are a no-brainer. It is why, in a few years time, as the millennials start university the cable, satellite, and fixed-line telecoms markets face an enormous upheaval. This audience simply will not purchase fixed services. They will expect and demand services that are delivered over mobile networks.

And if they by default have a smart TV or set-top box that supports 4K TV delivered to the unit over IP, then they will demand that that IP is provided by a mobile operator that allows them the flexibility to relocate the unit as readily as they relocate their smartphone.

So my prediction and vision is that the next big disruptive change in the market will be the introduction of SIM or eSIMs directly to the smart TV and IP set-top boxes.

I have not seen it done yet. But it will happen, and probably sooner than we all expect. You read it here first :)

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