Telecom Operators and Vendors Face New Challenges as Media Encryption Eliminates Nearly 60% of the Video and Audio Optimization Market

The doubling of audio and video mobile broadband traffic within the past year signifies that the demand for mobile entertainment is showing no signs of slowing down. Revelations of Internet spying, and content vendors worried about quality, drive the industry toward end-to-end encryption of data traffic. ABI Research, the leader in transformative technology innovation market intelligence, however, finds that encryption eliminated nearly 60% of the video and audio optimization market in 2015. Moving forward, telecom operators and vendors need to make significant and strategic operational moves to protect network performance and create a competitive advantage with streaming media entertainment.

“With encryption here to stay, operators need new tools to manage mobile broadband traffic,” says Joe Hoffman, Managing Director and Vice President at ABI Research. “We expect 85% of traffic to be encrypted. But that leaves 15% that can be optimized, and that is a significant network load.”

In the months ahead, telecom operators and vendors now face the challenge of coping with relentless demand for mobile data traffic without the proper tools to manage it. This obstacle coupled with the increased use of difficult-to-manage protocols, such as UDP, and inflexible data services could hinder operators if they do not find ways to reboot their strategies.

ABI Research suggests affected parties take proactive steps and get in front of the IP traffic demand, sooner rather than later. Leading infrastructure vendors, for instance, including Ericsson, Huawei, and Nokia, all have traffic management solutions to keep network operations steady and next-generation solutions that perform with encrypted streaming media are coming on the market.

“Telecom operators should also consider robust and flexible solutions like ‘IP Traffic Manager’ from Openwave Mobility or Sandvine’s ‘Fairshare Traffic Management’ to successfully manage the next-generation traffic,” concludes Hoffman. “While encryption did wound the video and optimization market, it does not mean mortality. After the industry gets through this rough patch, there will still be demand. The exponential growth of that media traffic will make even the residual optimization attractive to vendors that survive this shakeout.”

These findings are part of ABI Research’s Service Optimization & Monetization Service, which includes research reports, market data, insights, and competitive assessments.

# # #

About ABI Research

For more than 25 years, ABI Research has stood at the forefront of technology market intelligence, partnering with innovative business leaders to implement informed, transformative technology decisions. The company employs a global team of senior analysts to provide comprehensive research and consulting services through deep quantitative forecasts, qualitative analyses and teardown services. An industry pioneer, ABI Research is proactive in its approach, frequently uncovering ground-breaking business cycles ahead of the curve and publishing research 18 to 36 months in advance of other organizations. In all, the company covers more than 60 services, spanning 11 technology sectors. For more information, visit www.abiresearch.com.