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The State of Mobile Video 2014
From faster networks to wearable devices, everything is aligning to make mobile video grow faster than ever.
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Mobile video is growing by leaps and bounds thanks to the two main driving forces behind it -- 1) large, clear smartphone screens that do justice to video and 2) the booming tablet market. Now that consumers are picking up their computing and taking it with them, they are more apt to be watching video while doing anything from sitting in the park to commuting to work (hopefully on public transit). Ooyala reports that mobile and tablet online video views grew 133 percent from September 2012 to September 2013 and accounted for 15 percent of all video viewing in 3Q 2013 (Table 1). Cisco expects that video will total two-thirds of global mobile traffic by 2017.

Smartphones still see more video views than tablets, most likely due to a better penetration. The major demographic that is hooked into mobile video are the Millennials in the 25–34-year-old range. They are consuming 200 percent more video content on their smartphones and tablets according to a study commissioned by YuMe. They also watch the least live TV, which may account for their uptick in mobile video viewing as well as the largest portion of all forms of video content consumption. The study also found that, among Millennials, tablets are more popular than smartphones for video viewing.

TV Everywhere Means Massive Mobile Video Views

TV Everywhere usage is increasing for a variety of reasons including more offerings, more content availability, larger smartphone screens, and more tablets in the market. Adobe reported in April that TV Everywhere adoption had expanded 12 times in 2012 (in terms of authentications) and mobile video viewing grew 300 percent along with it. Gartner, Inc. estimates 184 million tablet unit sales worldwide in 2013, a number that could jump to more than 192 million this year. Along with that, mobile device viewing is skewing more toward long-form content, according to several recent reports.

In its Global Video Index for 3Q 2013, Ooyala reports that mobile and tablet video views accounted for 15% of all video viewing during that time period. 

Ooyala states that content in the 10-plus minute range accounts for 60 percent of viewing time on tablets and almost as much on mobile phones. All short-form categories account for less than 40 percent, though they might be more in terms of actual views as opposed to total viewing time. Tablets are seeing a large amount of movie viewing with around 25 percent of viewing time being content in the 60-plus minute category. Mobile phones seem to be slightly more closely aligned with TV viewing, with 21 percent–22 percent of viewing time consisting of content in the 30–60 minute range, and 18 percent–19 percent consisting of content in the 60-plus minute category.

TV Everywhere offerings are so compelling that a study earlier in the year by GfK showed that 25 percent of respondents were more likely to keep their pay TV service, if they could get TV Everywhere through the provider.

There is also a good amount of revenue available through mobile channels, as FreeWheel reported that total mobile phone and tablet ad views have tripled year-to-year 3Q 2012 to 3Q 2013. YuMe showed that unaided mobile ad recall was highest by Gen X and Millennials on smartphones, in the tablet browser, and in tablet apps.

With the amount of momentum and ever-expanding list of offerings, TV Everywhere is going to be a major driving force of mobile video viewing as we move into 2014 and beyond. But that could all change in the blink of an eye.

The Dawn of the Virtual Multichannel Offering

The next big thing that is going to boost mobile video viewing is going to be the rise of the virtual multichannel offering. Like cable, but without the infrastructure or set-top box, it will offer multiple channels of video content in a TV Everywhere-like, subscription-based fashion where users will be able to view Live TV content wherever they are, instead of being tied to their living rooms where the TV and set-top boxes are located.

Even Time Warner CEO Jeff Bewkes has openly stated he is willing to start cutting content deals with virtual pay TV operators of the future. This new brand of multichannel operator would also be able to carry a large load of video on demand, which could further cement its place in the hearts of consumers on-the- go, mainly Millennials and the younger generations. That will truly be TV Everywhere, especially if they offer a cloud-based DVR service with always-on access to that content, similar to what Aereo is offering in certain markets.

Faster Data Networks Mean Better Video Viewing Experiences

LTE and 4G mobile data networks expanded in 2013, making service more stable and widespread. With that came faster bandwidth throughput, which meant better streaming video quality for those who subscribed to the data network and had a smartphone capable of handling it. AT&T has been working to expand to 50 new cities in 2013 in an attempt to catch Verizon. It expects to reach nearly 270 million people in America by the end of the year. With the population of the nation around 318 million, it shows the ubiquitous nature of 4G LTE. Verizon’s network reaches 500 markets and more than 95 percent of the U.S. population already. Sprint too is working to expand its 4G LTE rapidly and is trying to reach the majority of the population next year.

4G LTE could, in ideal conditions, boost bandwidth speeds to 100Mbps–300Mbps downstream and 50Mbps– 75Mbps upstream; compare that to 3G speeds of 21–84 and 5.8–22, respectively (theoretically Revision 11 of 3G’s HSPA+ protocol could boost downstream speeds to 672Mbps). Granted, these are all theoretic maximums, and even Netflix states that 5Mbps–7Mbps is good for Super HD with highest available video quality nowadays. That’s a steady 5Mbps–7Mbps, which you will see later is still challenging in the U.S.

4K video streaming is going to need a lot more bandwidth eventually. In fact, Netflix has stated it will require about 15Mbps and a total connection speed of around 50Mbps; the company is aiming to begin streaming 4K in spring. Akamai, in its 2Q 2013 report, “The State of the Internet,” put mobile connectivity peak throughput on three major U.S. mobile networks in the range of 7.3Mbps–17.7Mbps, while average throughput is still dismal at 1.8Mbps–3.8Mbps (Table 2). With those types of speeds, Super HD and 4K futures are dimly lit pipe dreams for mobile streaming.

Comparing U.S. mobile bandwidth to speeds in Europe and Asia, according to Akamai’s 2Q 2013 report “The State of the Internet.” 

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