In the Press
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In the Press |
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Date: 2nd January 2008 Title: Youtube lifts the technology companies Despite all talk about mobile internet and IP-telephony they are barely visible in computer traffic statistics. The explanation is simple. To make a call via the computer network takes almost no space at all. The mobile services with movable pictures do also consume little capacity. The service can of course be costly in which case, depending on the tele companies' pricing. TV, download films and in particular use video with HD-quality, requires on the other hand a lot of capacity. Youtube leads the way. The video site has got the traffic in the computer networks to explode. - There is a huge growth. This development is exactly what we talked about 15 years ago. Those who succeeds in this market will do very well, says Fredrik Trägårdh, CEO of listed Net Insight, a company specializing in efficient video and TV transport in computer networks. - There is a lot of activity right now. The video services are driving the increase, says Karl Thedéen, CEO of Transmode. Transmode is based in Örnsberg, Stockholm and sells a technology for data transmission for big regional fiber optic networks that cover areas of the size of southern Sweden. The company has over 180 operators as customers in Europe, America and Asia. Net Insight and Transmode are hardly exceptions. The Swedish networking companies that in many years had a tough life in the shadow of the telecom crisis are now beginning to see the light. The applies in practice to all, from small private companies to big Ericsson. Despite the autumn's dip, both regarding profit and stock valuation, Ericsson's CEO Carl-Henric Svanberg still expects the traffic in the fixed networks to increase sevenfold by 2012. The upturn depends above all on the growth of broad band IP-TV. The big change is definitely symbolized by Youtube. Video clip download has increased the load in the broad band operators' networks. But above all Youtube has shown that there is a huge interest in video via the net. If video two years ago made up 5 percent of the traffic on internet it is now closer to 20 percent. And if the forecasts are correct, it will increase to 60-90 percent in two years. This is only partly due to Youtube and similar sites. According to the the American network giant Cisco we are now facing a traffic explosion in the computer networks. So far it has been about delivering video to the computer. But to sit in front of a computer is not always a pleasant experience. Most people prefers the TV sofa and according to Cisco this will be the next big wave: video via the network directly to the TV. It´s not about short video clips with low quality. Now the established companies are implementing their services and in Sweden Telia has already had success with TV via broad band. But ordinary TV requires a lot more capacity in the network and forces the operators to new big investments. Thereby the market is opened for technology suppliers such as Net Insight, Transmode and Ericsson. That trend is radically strengthened when offering really high capacity requiring services such as HD-TV. The attraction for the consumers is the larger selection of channels. Theoretically a consumer in Sweden could have access to some thousand TV channels from the whole world and order more or less any film at any time. The reality is hardly that good. As usual when it comes to TV the rights to content is a difficult thing. But above all the operators have to figure out how to get paid for the capacity hungry TV. An ordinary family that watches broad band HD-TV will for example quickly exceed the bit limits of broad band operators in many countries. - It is presently very difficult to predict where the revenues will come from, says Fernando Elizalde, consumer services analyst at the consultant company Gartner. Another important question is the the price pressure. Although the traffic may increase requiring increased network investments it is not sure that the producers will have more money in the pocket. - We are in the second the fastest growing segment of the telecom industry and we sell networks, where its harder to put pressure on the pricing. We find the price pressure very modest, says Karl Thedéen.
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