LIVE FROM HUAWEI GLOBAL ANALYST SUMMIT, SHENZHEN: Operators need to position video as a basic service like voice, rather than continuing to see it as a value added service, Huawei chief Eric Xu said.
“If that’s the case, we need to revisit the network, the organisational set-up, the operating model and the skill sets in the workforce, whether those are sufficient enough to support video as a basic service like voice,” he continued.
Xu also claimed that telcos are “better positioned” in video services than competing online service providers, who currently dominate the market.
“Since video is a real time application, telcos can combine this with their networking capabilities to deliver better and more compelling user experiences to consumers than OTT players,” he observed.
While thinking of video as a basic service would also necessitate a change in business models, there is also the opportunity to charge more for higher-quality services, for example through standard definition to HD, and onward in future to virtual reality.
This seems in part to echo the model of T-Mobile US’ Binge On proposition, where a number of video services are available free of charge albeit with reduced network quality, with customers able to opt-out in order to receive higher quality video (at the expense of data allowances).
This has the benefit of being “easily perceivable” by customers, who would understand pricing levels.
Xu noted that with mobile broadband services, the focus on selling capacity or speed is not always beneficial to the end user. “Those are not perceivable to the consumers. Only services can be perceived,” he said.
William Mar, director of digital enabling in the consulting business & network consulting department at Huawei, also pointed out that while the word “video” is used as an all-encompassing term, this actually covers a range of applications.
He noted video communications apps such as Skype or FaceTime, entertainment videos, and industrial applications (for example telemedicine and education) as key categories.
Some key areas for operators to concentrate on, he continued, include the real-world service levels experienced by consumers; ecosystem development; and the business model shifts required to support video growth.