The State of Mobile Video 2012

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Streb sees the emergence of HTML5 as a mixed blessing. "The emergence of HTML5 is probably the biggest advance for mobile video in recent years," he says. "But while HTML5 remains the key to reaching a large part of the fast-growing mobile audience on iOS devices, it has also introduced considerable complexity for publishers trying to ensure consistent video experiences across devices, browsers, and operating systems."

The problem with HTML5 is directly related to the range of device operating systems. The reason is that "Smartphones and tablets access HTML5 video using a variety of different versions of the WebKit open source browser technology, but the way WebKit browsers render HTML5 video varies depending on the version of iOS or Android the device is running," Streb says. "This variation can produce inconsistent playback experiences, as well as differences in advertising and analytics behavior. So while there is obvious promise for HTML5 video, organizations need to ensure their video content does not break every time Apple or Google releases a new iOS or Android software update, or that they do not need to rewrite plug-ins for things like advertising and analytics every time a new version comes out."

Until standards are implemented across the mobile video universe, these problems will continue. This is why: "The market needs to settle on a single open video format and streaming protocol that is supported across multiple platforms that together
command a vast majority of the market," says Streb. He notes, "The ecosystem of ad servers, analytics, audience measurement, and content protection technologies that grew up around Flash must be implemented in HTML5."

Standards are not the only obstacle to mobile video's unfettered growth: Carriers are also getting in the way. The problem is the one-to-one nature of data transmission. The more data users consume watching information-rich mobile video, the more
bandwidth they demand from their carriers.

Staying ahead of such bandwidth demand requires carriers to invest in network upgrades, which means spending money that could otherwise be enjoyed as profits. This is why carriers are not big fans of mobile video, at least not under the wireless billing models in use today.

According to Sandvine's Deeth, carrier resistance is stunting mobile video uptake. In particular, "One of the biggest obstacles preventing many from purchasing the first smartphone is the cost of a data plan," he says. "Data prices have continued to fall,
but at the same time, unlimited plans have begun to disappear, so the ability to watch unlimited amounts of video will be hard to do on many carriers."

Some carriers are actively developing new forms of data plans that harmonize mobile video data demands with network expenses, while providing subscribers with price certainty. One example of this is billing subscribers based by the hours of videos
watched or the device used. "In Canada, Bell [Canada] has had some great success implementing service plans which bill in this manner, charging $5 for 5 hours of video each month," says Deeth.

Beyond issues of standards and carrier resistance, mobile video's growth is being limited by the public's unfamiliarity with this technology. "It's like personal videoconferencing on the Internet," says Sonic Foundry's Lipps. "Today, Skype provides free
videoconferencing to its users, but most people Skype using voice only. In some cases, it is because they don't have web cameras. But much of the time, it is simply due to their lack of awareness."

The Year to Come

Despite the factors noted here, 2012 appears to be the year when mobile video will really start to take off.

"It's really just a matter of smart device penetration," says AccuStream Research's Palumbo. "There is abundant bandwidth (including Wi-Fi); publishers are committed to mobile; advertisers are following audiences; video platforms are addressing the
mobile opportunity."

So what do our experts expect to see happen with mobile video in 2012? We asked each of them for their final predictions.

"Tablet use will proliferate across the enterprise for daily use as use cases for mobile devices explode, driving down corporate IT support costs," replies Sonic Foundry's Lipps. "Over the next 24 months, tablets and mobile devices will surpass desktop PCs and laptops as the primary target delivery point for internally developed corporate and education content, mirroring the trends in [the] consumer market. Video streaming will continue to evolve to provide ubiquitous access across all major devices as standards are adopted."

AccuStream Research's Palumbo expects to see an increase in mobile video advertising, particularly in the U.S., U.K., and Europe. "Music, news, and entertainment will drive content views in 2012," he forecasts. "Election years typically boost overall
news views considerably."

Meanwhile, here are Sandvine's three 2012 predictions: "To make data plans more accessible, mobile operators will offer plans that will allow subscribers to share pools of data between family members or multiple devices," says Deeth. Second, "Traffic from streaming music services will increase now that Apple and Google have integrated their music services directly into their mobile operating systems." Third, "With unlimited data plans becoming scarcer, communications service providers will introduce more innovative billing options-charging per hour of video, unlimited access to popular sites-so subscribers can consume real-time entertainment with price certainty."

These are bullish predictions, but given the outlook for mobile video, they seem more than objective. This is one medium that seems ready for explosive—and profitable—year-after-year growth.

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