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2022 Cloud Roadmap: Transitioning Media Workflows to the Public Cloud

2022 Cloud Roadmap: Transitioning Media Workflows to the Public Cloud Image Credit: Proxima Studio/Bigstockphoto.com

The media industry expects an ever-faster rollout of new capabilities, driven by the pace of the competition and, to a large extent, by the new era of streaming service providers. To achieve speed and cost-effectiveness the public cloud is quickly becoming the optimal approach for telcos, TV operators, and other media businesses to deploy new media services. Research from Markets and Markets predicts that cloud-based video streaming solutions will grow at a CAGR of 20.9% from 2020 to 2025. However, navigating one’s journey to the cloud and understanding the available migration routes, deployment options, and operational approaches remains a complex undertaking. In 2022, we will see telcos and TV operators experiment and innovate their media services through the public cloud while re-defining their relationships with Cloud Service Providers (CSPs) and technology vendors. The result will be more dynamic, engaging, and efficient media services.

#1: Streamlining media businesses

The relationships that telco and TV operators have with their media business divisions continue to evolve significantly, not least with the onset of streaming recalibrating how they engage with their customers. The ‘quad-play’ and ‘triple-play’ bundles combining broadband, TV, and wireless services have proved tremendously popular among telcos and operators because of their consumer stickiness. However, media services aren’t always as profitable as broadband-only or telephony-only services.

A trend that we will see come into full fruition in 2022 is the growing seamlessness between public and private data centres. The big CSPs have fairly well-tested on-premises extensions that enable telcos and TV operators to virtualize their on-premise data centres but using the same software stack and APIs as their chosen CSP partner. This allows software applications to be tested once but seamlessly deployed in a hybrid on-premises and public cloud approach as desired.

Next year, the challenge for telcos and operators will be to maintain the value of their media businesses and their customer’s loyalty while also ensuring their operations are as cost-effective as possible. A fundamental way to reduce the costs of operating a media service is by migrating it to the public cloud and virtualizing its operations. This migration is particularly relevant to telcos and operators looking to push their media services towards streaming and multiplatform capabilities. The public cloud enables this while scaling a service up and down as required. Even if they have only started to adopt the public cloud for some functions, the trends towards leveraging CSP on-premises extensions will make it easier to move entirely into the public cloud when the time is right.

#2: Connect with consumers

Media telco businesses will move to cloud-based functions predominantly for streaming-first services. When they do, they may choose to bundle a video service from another provider rather than operating one themselves. This is already seen today, whereby telcos simply bundle their broadband and telephony services with a video streaming service such as YouTube TV. The problem with this is they lose their branding and user interface for the sake of a simple deployment. They also lose lots of actionable user data. For the video service, this lost data and branding means conceding a close connection with the consumer, including the chance to offer more relevant content and deliver more targeted ads.

White-labeled equivalents will allow operators looking for an outsourced approach to video services to maintain their UI and branding for new service launches and a closer connection with the customer. With this approach there are no shipping requirements for set-top boxes, as the user simply downloads an app onto a streaming dongle, their smart TV, or connected device. This frees up the ability to sell high-margin broadband connections and bring greater profitability to the overall triple- or quad-play bundle. The increasing use of the public cloud and streaming to get to public CDNs will make this transition towards streaming-first functions far easier for mobile operators and broadband service providers.

#3: Spending money in the public cloud

To coincide with the ongoing migration to the public cloud, we will see selling and purchasing habits evolve further to meet the new operational needs and changing relationships between telcos and TV operators, the CSPs, and the technology vendors. Telcos and TV operators make spend commitments with a CSP in return for better pricing. We’ll start to see the purchase cloud services from technology vendors through the CSP marketplace rather than via a traditional procurement approach. The purchase via the CSP marketplace will allow the investment they make on third-party vendor solutions to apply to the CSP spend commitment that has been made.

This changes everything about the way telcos and their technology partners operate the buy/sell relationship. Procurement practices will advance, and everything in the public cloud will likely transition into a ‘managed cloud application’ (MCA). These arenew forms of commercial and deployment models for cloud-based software, lying between Software-as-a-Service (SaaS) and software subscription models. The technology provider deploys and manages the software in an MCA deployment, but it remains within a customer’s own cloud account. This has the benefit of using a customer’s preferred CSP vendor, typically being selected as part of a wider company transformation, while taking advantage of agreements and spending commitments with that CSP for media applications. Even data centers and value-add services can be done through MCA models rather than just selling the product directly.

#4: Streaming in the public cloud

Another big trend to expect next year is a surge in dynamic advertising. Advertisers will realize it’s far more lucrative to reach a smaller, more engaged audience on streaming services than potentially 10million+ unengaged audiences on Pay-TV, who are geographically or demographically irrelevant to the ad. Increased dynamic ad insertion will bring far greater revenues for advertisers and better media experiences for TV operators and telcos.

The ongoing 5G spectrum sales will affect how many TV operators get their TV content. If they’re retransmitting channels from programmers that are delivered over C-Band spectrum, they might have some changes to deal with next year because of spectrum changes with a particular impact on the US market. Channel content for retransmission will increasingly come from IP and cloud-based sources rather than satellite feeds.

The next World Radiocommunication Conference (WRC) takes place in 2023, where most mobile operators will be pitching for more spectrum for 5G. For 2022, this means we’ll see plenty of changes made to pre-empt the continued reallocation of spectrum. Consequently, telcos and TV operators will need to work with their governments on their spectrum reallocation.

The ongoing migration to the public cloud is a guaranteed trend for most media units in the next 12 months. It’s a continued trend from previous years as telco and TV operators continue to adjust to competitive pressures in the complex media landscape. The question is how fast they migrate and what migration model they choose, with their decision setting the benchmark for the quality and scale of media services in the forthcoming years. By embracing new deployment models and working closely with third-party experts, telcos and TV operators can maintain their relationships with CSPs while streamlining the day-to-day operations of their media divisions. It’s a trend we’ll see adopted much more in 2022, and the result will be far greater flexibility for the telco and operator and better media experiences for their customers.

Author

Carl Furgusson is Head of Portfolio Development at MediaKind. He has over 20 years’ experience working in the video technology industry for television service providers and is an expert in Media Processing, including MPEG-2, MPEG-4 AVC, HEVC and AV1.

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