Explaining The Near Future in Enormous Bytes

by P.J. Bednarski, Jan 16, 2013, 2:00 PM

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I tend to be skeptical of reports that nobody under 24—and for as long as the Cord Cuttters Club have been saying it, now that’s anyone under 27—has a TV.   

But a Bell Labs report that came out last month, and didn’t seem to get much widespread coverage intrigued me about how rapidly the video universe is changing.

Its analysis predicts that by 2020—which I like to say is seven years from now—time spent watching VOD services will grow from 33% today to 77%.

The more stunning prediction is that the share of time we’ll spend watching “traditional broadcast services” will ratchet down to just 10% from what Bell Labs says is 66% today.

Could that be true? Only 10% of our viewing will be watching broadcast TV?  That sounds far fetched. That would be taking television from 80% shares in the 70s to nearly nothing in the very near future.      

Bell Labs says Internet-based video consumption each year will grow twelvefold from 90 Exabytes to 1.1.Zettabytes. (How big is that? According Wikipedia, my go-to source for things that are clearly going to be over my head to start with, “As of 2009, the entire World Wide Web was estimated to contain close to 500 exabytes. This is a half zettabyte.”

To put it in a slightly more comprehensible way, managed video-on-demand consumption is expected grow at a 28% annual rate.

Bell Labs says that in U.S. consumers will be watching 7 hours of video a day—mostly video on demand and most of it through the Internet and mostly on a tablet.  That, Bell says will put a load of stress on the IP edge of broadband networks.

The Bell Labs view of the future fascinates me because it’s predicting a future that is a lot closer than I’ve ever imagined. And of course they could be dead wrong.

Bell says service providers looking to embrace and generate new revenue from this surging tide of video are faced with two fundamental business challenges: Figuring out a way to prepare for the stress on IP networks and lower the cost per bit, and controlling the cost of traffic from Over-the-Top Web-based video providers.

The issue of how this is all going to be able to work out made the Bell Labs study somewhat bigger news in tech circles. After all, it’s Bell Labs. But for content providers and advertisers, those are some stunning numbers.

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