The idea of getting unlimited streaming movies for something that might be around $10/month is pretty appealing. And with more and more TV & compatible devices (PlayStation 3, Xbox 360, Wii, etc) with Netflix support, I think this kind of service will have genuine mainstream appeal. No longer will folks have to mess with wires to connect their PC to their TV!

I do have a few concerns about these types of services. I can’t be watching a movie in the living room with my wife and have the movie break-up and begin buffering because there is congestion on the network. In order for services like these to satisfy mainstream customer expectations, the quality of experience should be consistently excellent. High-quality large format TVs are very good at highlighting the difference between high quality and low quality video.

The reality is that streaming video is perhaps the most demanding consumer application in terms of broadband network resources. As such, it demands intelligent and efficient network management; network management that is sensitive to and aware of the specific requirements of various applications. A consumer’s sensitivity to a video buffering mid way through an action scene is very high. Their sensitivity towards a bulk file transfer taking 10 seconds longer is very low. Network operators with visibility to and understanding of the broad range of applications that traverse their network are in the best position to satisfy the growing demands for high quality real-time broadband entertainment.

It should be noted that most people have been expecting this announcement ever since Hulu launched.  Despite its popularity, Hulu continues to lose money, and it faces stiff competition from the likes of Netflix and iTunes.  To help muscle into living rooms around the United States, Hulu and Microsoft will join forces to bring Hulu to the Xbox Video Marketplace dashboard, and Hulu will also be available on Sony’s PS3, Apple’s iPad and iPhone, and a slew of other devices like Bluray players and TVs.

Whether or not they’re interested in Hulu’s pay service, subscribers are likely to gain from increased entertainment options.  With a wide variety of hardware (set top devices, game consoles, placeshifting devices) and services (Hulu, iPlayer, etc) and ongoing investments by service providers in advanced network policy control to deliver optimum quality of experience, the marketplace will decide the winners; ultimately, the choice is up to the subscribers.

The other thing I noticed was the battery consumption on my phone.  I live in Tucson, Arizona.  As you can imagine it’s a much different place than New York in many ways.  But one of them for sure is the battery life of my iPhone.  In Arizona, my iPhone will go a few days between charges while on stand-by and most of the day if I am out and about using it to look things up, check my email, and even take the occasional call.  It’s kind of old school, but I still actually call people on the phone.

Anyway, while in New York my battery was lasting less than 4 hours.  When I checked the cellular data usage meter on my phone (its under the “about” menu for all the non-iPhone users) it showed my phone was transmitting more than 2 Mbytes every hour and receiving more than 2 Mbytes every hour and this was with it in my pocket, not doing anything.

So I tried all the well known tricks to extend the battery life like turning off 3G and using only EDGE, turning off the blue-tooth, turning off the Wi-Fi, turning off push notifications, and setting the email to manual mode retrieval so that it wouldn’t try getting my email in the background.  But none of these things seem to have any impact whatsoever.   I then even “disabled” my mail accounts on my iPhone as all I really wanted was my phone to be ready to receive a call as I was expecting an important one.

Even after doing all this, my battery life didn’t get any better nor did it stop my phone from using cellular data. As one could imagine by now I was getting quite frustrated and as I dwelled upon it I convinced myself the only other possibility was that my phone had a rogue application (i.e. virus) running on it.  So, I proceeded to do a hard reset to set it back to the factory defaults.  I learned the hard way that after doing this the iPhone has to be re-initialized by connecting to iTunes and having done this in a city park meant I didn’t have my laptop and iTunes nearby.  So I now had to find a store for my carrier to see if they could help.  Fortunately there was one nearby and they kindly re-initialized my phone.  The clerk at the store asked why I had done this, and I explained the story about my battery.  She responded that this is a common problem for all the iPhones in New York due to the over-subscribed network.

I don’t know if she knew what she was talking about or not.  We have all heard complaints about certain networks in New York.  So I don’t know if this was some kind of phone chatter due to my phone constantly re-attaching to the network or if it was something more malicious like a battery drain attack on my phone from the network.

This got me to thinking about what is going to happen to all the iPhone users on some of the recently announced capped data plans where subscribers are liable for data overage charges.  Personally I would be really unhappy to find out my iPhone was running up my bill even though I wasn’t using it.   I am not sure what various carriers plan to do here, but they certainly will need to be planning on not counting that kind of traffic towards people’s monthly caps as otherwise they will have a lot of people switching to another carrier.

Now, at Sandvine I know we have a set of solutions that mobile carriers could use to classify and meter the traffic to ensure that rogue traffic doesn’t create bill-shock as well mitigates network security attacks.  And my experience in New York clearly shows that operators cannot count all traffic equally as there is a lot of traffic that is beyond the user’s control.

Anyway, it will be interesting to see how this all unfolds.  Needless to say the mobile data space is in one of those interesting periods.

And since returning home, my phone is working fine.  So it wasn’t the battery nor was it a rogue application.  The best I can tell, it was something to do with the network.

Alongside the very Hollywood-esque show is CableNet. This always well-attended “product demo-focused” pavilion of the show, organized by CableLabs, provides insight into timely key themes such as interactive TV, video on demand, and broadband over cable. It gives operators the chance to see a broad range of product demonstrations within a very focused area.

Sandvine took the opportunity to demonstrate its latest product in our Network Business Intelligence Portfolio.  Network Data Analytics is focused on providing an executive level dashboard view of how subscribers are using their broadband service. It aims to answer questions like “How do my DOCSIS 3 subscribers use their service compared to the DOCSIS 2 subscribers?” or “Where will I get the best return on my CAPEX budget?”. It was great to see the many cable operators who  dropped by to explore. They were quite intrigued by the flexibility of the product and how it could potentially help them to enhance their businesses and their customers quality of experience. After all, providing better broadband is the end goal.

In addition to a wide range of operators, we were pleased to host FCC Chairman, Julius Genachowski, when he dropped by to see some of the trends that Sandvine is currently reporting on.

Were you at the show? Please share your better broadband observations and experiences.

The most popular island app was web browsing at 43% followed by email at 32%. Twitter and Facebook came in at 5% each and a bunch of you picked “other” which primarily broke-out into the websites for your favorite airline

I guess the results shouldn’t surprise – the vast majority consider the basic applications as the must- haves. We can all wait until we get home to resume gaming and watching movies.

While the exact increase varies, network operators servicing regions where iTunes is available can count on seeing an increase in Internet traffic on Christmas Day due to swarms of people putting their gift cards to immediate use.  Generally, iTunes accounts for about 1% of total Internet traffic, so a massive surge isn’t a negligible amount of bandwidth.  A brief survey of networks we serve showed that our customers saw anywhere from a 20 percent to 200 percent increase in iTunes traffic on Christmas Day, and it took about a week for the level to return to normal.

Of course, surges aren’t limited to music.  Many lucky people (who weren’t naughty) got to unwrap a shiny new game console, leading to a sudden rise in the amount of gaming traffic and console-based downloads (like firmware updates, movie-trailers, and game add-ons).  This observation shouldn’t be a surprise – it is expected that major game releases (most recently Call of Duty: Modern Warfare 2, which just crossed $1 billion in revenue) cause dramatic increases in online gaming traffic.

Thankfully, it’s not all about commercialism – many network operators also spotted bumps in VoIP traffic (particularly Skype) as well-wishers called loved ones on New Year’s Day, mirroring a similar phenomenon that repeats itself every Mother’s Day.

What does 1080p mean to the average subscriber, and what does YouTube’s announcement mean to Internet providers?  Consider the trailer for “The Dark Knight”, which is about two and a half minutes in length.  This table shows the average stream rate at various resolutions.

Clearly, the instantaneous bandwidth requirements are dramatically different for the varying video resolutions.

*As an aside, it’s interesting to note that for the average user watching the video on a laptop, netbook, or even desktop computer, it will be hard to notice a significant difference in visual quality despite almost a 6x increase in bandwidth utilization.  Most monitors simply won’t display in 1080p resolution.  However, if you have your computer hooked up to a 24” monitor or HDTV, or if you have a web-enabled TV, then 1080p represents a major upgrade.

What happens to the world’s broadband networks if more users start clicking on YouTube’s “watch in HD” button?  Measured by total network bytes, YouTube is perhaps the most popular site on the Internet – our recent 2009 Global Broadband Phenomena study found that YouTube accounts for about 5 percent of total Internet traffic.  While we’re certainly not going to see an overnight 6x bandwidth increase for YouTube as a whole, if even 10% of YouTube users start watching their videos in 1080p (and this assumes more 1080p videos become available), then networks around the world may well be facing a dramatic and rapid increase in YouTube traffic, and in bandwidth utilization as a whole.

For many Canadians, who are unable to access Hulu and other popular US-based sites, the launch of these services is a welcome development.

Many Internet studies, including our own, have shown a major shift in online entertainment habits: subscribers worldwide have shown an appetite for on-demand video services as a replacement for P2P filesharing.  Video streaming offers the convenience of watching something now with the simplicity of a single click, which is appealing for subscribers who aren’t inclined to configure P2P clients for maximum performance or who don’t necessarily want to plan their viewing well in advance.

A key factor contributing to the relative popularity of on-demand video is the availability of local content and services.  For example, real-time video is most popular in Asia-Pacific, the United States, and the United Kingdom, thanks to localized programming and services (think Hulu and BBC’s iPlayer).  Obviously, the broadband network infrastructure needs to provide a consistent quality of experience; however, this is a necessary but insufficient condition.  In regions where Internet speeds are high, but localized programming and language support is not available, we still observe disproportionate levels of P2P traffic.

Presumably, the majority of Canadians who will use the Rogers on Demand online portal are also using Rogers as their Internet provider.  Likewise with Bell TV Online.  If recent history has taught us anything, it’s that these services will prove very popular, and both the Bell and Rogers broadband networks will see a significant shift in traffic composition as Internet subscribers embrace the “now” experience as a part of their entertainment routine.