Service reduces churn, makes operators stand out from their competitors
High-definition video-on-demand defines instant gratification for cable subscribers. “What you want to watch, when you want to watch it” is literally being played out on millions of streams via on-demand services in customers’ homes.
Comcast made a big splash at the International Consumer Electronics Show earlier this year when chairman and CEO Brian Roberts outlined the company’s vision, called Project Infinity, to put more content into the company’s VOD tier.
Comcast, which started its VOD service in 2003, is betting that the future of TV is on-demand viewing, and to that end, it expects to have 6,000 movie titles per month in its VOD movie library over the course of the next 12 to 18 months.
HD VOD is the spearhead of Comcast’s VOD plan of attack: The company plans to offer more than 1,000 HD movies, TV shows and other viewing choices monthly by the end of this year, along with making more television network programming available in HD.
Currently, Comcast has between 250 to 300 HD titles in its library, which includes movies, music videos, network programming and content from premium providers.
“It’s about having everything on-demand and it’s the future of TV,” said Comcast’s Derek Harrar, SVP and general manager of video services. “When you look at our high-def strategy, it’s really built around that vision.”
Comcast has over 10,000 titles available for on-demand viewing each month, with 90 percent of those titles available for free. Harrar said that between 90 percent and 95 percent of the 10,000 titles are viewed every month.
Profits and customer experience
While Comcast’s customers clearly enjoy HD VOD, the benefits are also clearly mutual. In Comcast’s year-end earnings report for 2007, 6.3 million, or 42 percent, of its digital cable subscribers took advanced services such as digital video recorders (DVRs) and high-definition television (HDTV), compared to 4.5 million, or 36 percent, a year ago.
At the end of last year, Time Warner Cable had approximately three million HDTV subscribers, and it also plans on ramping up its HD VOD offerings.
“Perhaps the element of our HD plan that differentiates us the most from our competitors is our dramatic expansion of HD video-on-demand,” said Time Warner Cable COO Landel Hobbs. “Currently we offer 50 transactional movies in HD. By year-end, we expect to have as many as 200.
“In addition, our HD showcase offers 80 HD titles on-demand for free. Remember, this is over and above our linear HD channels. Satellite simply can’t match this offer. You’ll see us move much more aggressive marketing around these value propositions in 2008.”
And it’s not just the large cable operators who are rolling out HD VOD. Bresnan Communications plans on having HD VOD up and running in some of its systems before the end of the year.
“We just started working on that, and as soon as we get the server upgraded and the plant put together we’ll be there,” said Pragash Pillai, Bresnan’s vice president of strategic engineering. “The good thing is HD VOD is not ground-breaking, so it’s not really a lot of work on our side; it’s prioritizing our plan and then going forward with that plan.”
The challenges of adding HD VOD
While Pillai makes it sound easy to add HD VOD, as usual, there are some items to consider – namely bandwidth.
Cliff Aaby, Arris’ principal system architect for on-demand platforms, said the file size of a two-hour HD movie encoded in MPEG-2 is roughly four times the size of the same movie in SD. The HD streams drive down the available number of video streams in a service group.
“If you use 15 Mbps per stream and have four QAMs in a service group, then you can expect a total of eight HD streams and up to eight SD streams where you had a total of 40 SD streams before,” Aaby said. “So your stream count just plummeted in terms of being able to service the group you intended to serve. The end result of all of this is that your contention rate for a service group goes way up with HD.”
Aaby said some cable operators were looking at 12 Mbps per stream so they can get three HD streams on a 256 QAM pipe, while other operators are sticking with 15 Mbps so they can get two HD streams plus one or two SD streams in the same pipe.
“When you look at what the concurrency rates have been designed for, which is 8 to 10 percent in general this year, you realize that effectively what we’re doing by adding a bunch of HD in the on-demand space is we’re putting the equivalent of a broadcast lineup into unicast space,” said Basil Badawiyeh, Arris’ vice president of on-demand strategy.
“What that means is that considering the lower number of HD channels that are available, most people will watch that HD content a lot more frequently than a long tail piece of SD content that has been sitting on the server for a long time,” Badawiyeh continued. “In order to be successful on the operator side you have to make sure that you’re not only managing your service groups and the concurrency rates properly, but you also have to be able to run that HD VOD lineup using a back office implementation that knows how to scale and deliver that type of solution from a session resource manager perspective.”
Aside from bandwidth-enhancing technologies such as node splits, switched digital video, MPEG-4, and plant upgrades, there are also devices such as policy managers and session resource managers that can intelligently manage the allocation of the bandwidth that is available.
Bigger, better VOD servers
Since VOD systems were originally implemented for standard definition streams, cable operators need to size their networks and VOD servers for HD. The good news is that the latest generation of VOD servers are much denser than they used to be.
“The challenge of HD is fundamentally one of needing more storage,” said Phil Simpson, SeaChange’s director of on-demand solutions. “Depending on the codec, you could be looking at up to four times the amount of storage per hour for the content. Then you need up to four times the bandwidth per stream in order to get it down to the set-top box.”
Arris’ Badawiyeh advocates using a combination of RAM, solid state, and disc storage on video servers. Content that’s rarely viewed, such as movie credits, can be stored on a server drive while content that is viewed more frequently can be cached in RAM storage.
Today’s VOD servers are much more dense than the first-generation servers. They can store up to 1,500 streams compared to the 400 or 500 SD streams that their predecessors stored.
“From day one we thought it was important to separate storage capacity from streaming capacity,” said Jim Owens, Motorola’s product marketing manager, digital video solutions, who was also with Broadbus prior to Motorola’s purchase of that company. “One of the other issues when you build your network for HD is whether you use centralized or distributed content, and the pendulum has kind of swung to intelligently placing the content between servers.”
Millions and millions of streams
Comcast passed the six billion view mark in November with its VOD service. Currently, there are about 275 million views a month across the various categories in Comcast’s VOD tier with customers hitting the play button 100 times a second.
“It’s really all there for you on a time-shifted schedule at your convenience,” Comcast’s Harrar said. “We do all kinds of research with our customers. We watch the anonymous usage data very closely, we do focus groups and we try to listen to our customers to make it as relevant as possible, and frankly, they love it.
We see it in churn reduction and it’s a great differentiator for us.”
|Verizon ramps up HD VOD|
While AT&T is somewhat constrained with offering HD VOD with its fiber-to-the home architecture, a company spokeswoman said HD VOD is on AT&T’s roadmap, but didn’t provide a timeline for when that will occur.
Late last year, Verizon launched HD VOD on its FiOS network in several markets and announced it expects to have 1,000 HD VOD titles by the end of the year. Currently, Verizon has about 75 HD VOD titles, including movies and free programs.
Verizon’s video-on-demand service is delivered end-to-end as an IP stream over its fiber. This includes the bearer channel traffic, and the VOD stream, as well as all of the signaling to and from the set-top box for metadata retrieval, session setup and stream control.
Verizon made some changes to the VOD signaling to allow it to work in a network address translation (NAT) environment. All of Verizon’s set-top boxes are networked behind a home router and all of them have a private IP address. For the VOD servers to be able to reach the set-top boxes, Verizon’s NAT-scheme uses one public IP address on the broadband home router that maps to the private addresses on the set-top boxes within the home,
Each HD VOD stream is a constant bit rate (CBR), MPEG-2 transport stream with varying encoding rates, but most are encoded at 15 Mbps or higher, allowing Verizon to offer HD VOD without having to stat mux into multi-program transport streams with other HD and SD streams.
Cable and telco providers have a big edge over satellite providers, since the latter can’t offer true VOD services. Satellite providers can download movies into set-top boxes, but can’t offer HD VOD in a dynamic fashion.
SeaChange’s Phil Simpson, the company’s director of on-demand solutions, said since most homes have an average of 2.5 TVs, most operators think that delivering three streams per household will be ideal because that number allows the various TVs to simultaneously tune into different programming. –MR