This is it folks, it has happened. Cat videos are officially responsible for sustaining an entire industry. Civilization as we know it has changed.
Okay, well not really. But the unprecedented volume of videos being streamed online is responsible for growth in the Global Video Content Delivery Network Market, which is posting a CAGR of 29.66 percent from 2014-2018.
When we say unprecedented, we really mean it. In 2013, the average video traffic over the internet was estimated at 23.2 Exabytes per month. This is expected to reach 71.5 Exabytes per month by 2018.
To put this in perspective, one Exabyte is 1,000⁶ bytes or roughly 1 048 576 terabytes. That’s a lot of data. We are consuming video content in bigger quantities, at higher qualities and on more devices and platforms than ever before through services like Netflix, YouTube and Vimeo.
Now, the online video ecosystem looks something like this:
All this data being thrown around can seriously slow down load times, which can actually translate into major dips in revenue for companies. Emphasis is being put on content delivery network (CDN) management to stimulate the download process and accelerate site speeds.
CDNs are servers placed closer to users to reduce latency in transmitting content across long-haul networks. They are interconnected over the internet and help optimize a network’s performance.
So maybe it’s a bit of a stretch to pair cat videos with the growth of an entire market. But TechNavio analysts have pinpointed some trends that are significantly shaping the Global Video Content Delivery Network Market over the next four years.
Major Players Building CDNs
While big companies used to outsource their CDNs, they are now seeing the financial benefits of building their own. Recently, Apple Inc., which earlier relied on Akamai and Level 3 to deliver Apple-related content including apps, iTunes videos, and software updates for iOS and OS X platforms, built its own CDN to serve its consumers. In 2012, Netflix announced that it was shifting most of its streaming video traffic to a single purpose CDN Open Connect owned by Netflix.
Big brands like Amazon, Apple, Google, and Microsoft are the reason for the huge increase in internet traffic, and their inclination to own their dedicated CDNs is expected to be one of the key highlights during the forecast period.
Growing Proportion of CDN Internet Traffic
Different members of the CDN value chain are expected to foster the placement of more content near the user. It is expected that by 2018 around 53 percent of online content will be transacted over CDN networks, increasing from just 34 percent in 2013.
Telecom Operators Capitalizing on OTT Content
Telecom operators are largely affected by an upswing of over the top (OTT) applications, even though they’re the group that stands to benefit the least by them. Operators are unable to map the exponential growth of online video on generated revenue, while the other members of the value chain are monetizing on content delivered over a highly strained network infrastructure. With endless demand for data applications, telecom operators are contemplating cashing in on OTT services by enhancing user experience and ensuring customer loyalty.
Wide Acceptance of Integrated CDN and Transparent Caching
With rising online video traffic, network operators worldwide are compelled to adopt new strategies to cater to ever-growing customer needs. The confluence of CDN and transparent caching technologies is an optimized solution to cache a large portion of the traffic, both managed and unmanaged, to achieve reduced CAPEX and OPEX. Professional video and user-owned data will be on the rise and encourage the operators to adopt a converged strategy to exploit the best of CDN and transparent caching.
Increasing Technical Innovations in CDN Solutions
The rapid growth of OTT services, increasing strain on the network infrastructure, the huge sunk costs, and bleak return on investment are among the prime drivers for technical innovations in CDN solutions.
One such innovation is adaptive streaming based on network performance status, such as latency and unused bandwidth, on user devices like tablets and cell phones, and on streamed content such as SD, HD, or low resolution. With such features, content can be delivered to all devices in high quality. Innovations in the delivery of OTT content can also be capitalized, which includes classic streaming, content control, and premium content. Such applications can enable operators to focus on offering bespoke solutions depending upon the customer requirements and behaviors, and help in retaining the user base and improving the average revenue per user.
Shift from Fixed to Mobile Broadband Access
Mobile broadband presents an attractive option for countries where high infrastructure costs make fixed-line broadband difficult. In recent years, the increase in mobile wireless data has been particularly high in emerging countries, and broadband accessibility through mobile devices is now a high priority for people in these areas. A rapid adoption of mobile broadband in both developed and developing markets is expected during the forecast period.
For more insights, view our Global Video Content Delivery Network Market 2014-2018 report.
