Differentiating network services through CDN

01 August 2013 | Frank Childs

Cover

Frank Childs

Blog Author | Akamai; Director of Product Marketing, Carrier Products


Meeting the rising content and service expectations of subscribers across multiple devices has presented new challenges and opportunities to network operators globally.

Meeting the rising content and service expectations of subscribers across multiple devices has presented new challenges and opportunities to network operators globally.

Operators need to focus on managing the network costs to deliver services, whilst trying to leverage the increased adoption of content and services to favourably impact revenues. And at the heart of the opportunity is the ability to improve service performance to truly differentiate their network from the competition. To accomplish these goals, we are witnessing an emerging opportunity for network operators deploying their own CDNs to become valuable stakeholders in the content distribution value chain.

Network operators are coming to terms with the consumerisation of IT - specifically the burden it has on their networks.

According to a report by Nokia Siemens Networks, over 85% of traffic on the mobile network will be generated by mobile data, of which 49% will be delivered via handheld devices by 2015. At the same time, BYOD (Bring Your Own Device) is not showing any signs of slowing down. In fact, Gartner has estimated that by 2016, two-thirds of the mobile workforce will own a smartphone, and 40% of the workforce will be mobile.

The situation presently facing many network operators is that their traffic is being served from external peering and transit. This leaves them with no control over the traffic delivered which results in unpredictable swings and a less than optimised network. The latency will thus affect web and streaming performance to subscribers.

Operator CDNs are fast emerging as a high priority element of network operators' strategies to support the delivery of all content and applications - their own services as well as those from OTT providers.

They see CDN as a strategic and highly complementary way to offer new and differentiated content services and provide a superior Quality of Experience (QoE) for their subscribers. From a cost perspective, CDNs will contribute to a reduction in network infrastructure costs. At the same time, operators will be able to provide a holistic and quality experience for subscribers across a variety of IP-connected devices.

As with every new technology, we can expect lukewarm reception initially. The first phase of telecoms CDN may not be a success in terms of achieving revenue or traffic offload goals. To begin with, past telecoms CDN offerings have been somewhat limited to bit delivery, which is important, but not enough to win over many media or enterprise customers.

These customers are keen to enhance their existing enterprise portfolio and differentiate their network, hosting and cloud services. The offerings will need to evolve to address enterprises’ needs to not only deliver content, but also improve service quality, simplify workflow, reach an array of devices and provide global reach and scale.

Another reason was that the CDN offerings were only limited to the operator’s network footprint. This was not in line with online businesses’ strategy and business roadmaps, seeing how they want global partners, to reach customers wherever they are or decide to be located.

Thankfully, this is changing. We see more network operators considering CDNs as a core element of their network infrastructures. We are also witnessing an emerging opportunity for network operators to become valuable stakeholders in the content distribution value chain. In my conversations with network operators, apart from improving delivery and offloading traffic, it was clear that many of them need to license, own and operate the big bit delivery component of a CDN service.

They build their own operator CDN capabilities, allowing them to monetise their network, reduce costs and enhance retention, customer loyalty and service satisfaction.

A recent report indicated that the global CDN industry will reach $7.4billion by 2017, which is not the least surprising.

The proliferation of new devices in the marketplace will continue to create numerous challenges for content providers who are trying to satisfy customer demand for anytime, anywhere access to content. Consumer adoption of internet videos and other media will continue to grow; networks around the world are going to experience an explosion in traffic growth, which will result in congestion across an operator's network from aggregation, to backbone, to interconnect.