July 4, 2011
Volume XXXV, Issue 9
Connected TV Will Be Preferred Gateway to Online Video
Excerpted from Telecom TV One Report by Ian Scales
Worldwide sales of connected TVs will surpass games consoles for the first time in 2011 and some "stand-alone" devices, like Apple TV, don't look such a brilliant idea now either.
The Internet-connected TV market is shooting skywards from its niche position just a couple of years ago. According to a new report from Informa Telecoms & Media, the big Eastern consumer electronics manufacturers are on-track to sell 52 million connected TV sets.
Meanwhile Microsoft, Nintendo, and Sony will sell just 37 million consoles this year.
These contrasting figures paint a consumer desire to connect through their TV sets - along with their Blu-ray players, games consoles, and set-top boxes (STBs) - to get to services such as Netflix and iPlayer. That trend will continue and the report says that by 2016, 70% of all in-home video devices sold will be able to connect to the Internet.
"Until now, many online video services were launched primarily with the game console in mind, mainly because console users innately understand how to connect these devices and demand interactive video services from them.
"The largest consumer electronics (CE) manufacturers stand to make the biggest gains, in particular the big three: Samsung, LG, and Sony. However, TV manufacturers will be faced with a conflict of interest. On the one hand, they must build and support a platform that works across both the latest and legacy devices, effectively reducing the differences between the two - and, on the other, they must persuade users that the latest iteration is a superior device and worth purchasing."
"Only if they do this successfully will CE manufacturers be able to seize the balance of power away from traditional video aggregators." Informa says the main losers from this trend will be media-streaming devices, which it does not believe will move far beyond the niche status they currently occupy. This has major implications for players that have launched stand-alone boxes, not least Apple.
Informa believes that, if Apple is to win in the connected home, it must launch a TV, or at least turn its Apple TV device into something more than a convenient way to access video via iTunes.
Prime Time Is Web Video Time
Excerpted from VidBlog Report by Steve Smith
For the web video phobics who expect streaming media to cannibalize TV viewing and undermine age-old business models, warm up your paranoia. The share of web video viewers who are watching online media between 6 PM and 9 PM has gone up more than 30 points in the last two years.
The Yahoo!/Interpret study of over 4,000 online viewers compared survey results compiled this year with those from 2009. Back then, video viewing plummeted during the 6 to 9 day part, down to about 10% of users. But in 2009 that number has skyrocketed to about 45% of respondents saying they have watched qeb video during that time frame in the last 24-hours.
Clearly, Netflix and Hulu, whose use more than doubled among respondents in the last two years, is drawing off eyeballs from prime time. The study also found that the consumption of full-length TV shows among video users went from 11% to 18% since 2009, while the consumption of small clips declined from 84% to 74%.
The move towards longer, more polished forms of video is only good news for advertisers. Almost all of the right metrics, from ad and brand recall to relevance were stronger for ads seen next to professionally produced content.
Interestingly, ad receptivity is enhanced when the video is not standing alone but part of a multi-media context. Fifty-seven percent of people say they like watching a video when it is next to an article. These viewers may also be more engaged with both content and ads, since 24% said they watched the video to get more information (vs. 12% for standalone video), 61% thought of the video as more professional (vs. 54%) and 42% recalled seeing advertising (vs. 39%).
Yahoo! characterizes the rise of primetime web video viewing as "meteoric" and suggests the tighter integration of TV and online advertising.
One trend that seems to be easing is video sharing. Yahoo!/Interpret says the raw number of videos that get shared has increased in the last two years, but the number of people who say they share video has declined notably, from 34% in 2009 to 26% now. Part of this is an aging of the video sharing population. The typical video sharer has aged, with 74% now in the 25-54 demo (vs. 64% two years ago). As we get older our compulsion to share clips seems to diminish.
Report from CEO Marty Lafferty
 KPMG, the large audit, tax, and advisory firm, this week announced results from its annual survey of more than 100 senior executives at information technology (IT) firms in the hardware and software sectors, just in time to give American distributed computing industry participants some encouraging words leading into the Fourth of July holiday weekend.
Results are particularly promising for the US market, which has rebounded enough to provide the highest percentage of revenue and employment growth in the next year, ahead of China and India, which led for the past two years.
China, Brazil, and India now follow the US in revenue, while India and China are second and third in employment.
In addition, tech leaders this year predict the US also will have the industry's greatest percentage of research and development (R&D) investment growth, followed by India and China.
The survey ranked cloud computing as the top revenue driver. It was chosen by 65% of the respondents, up from 54% in last year. Cloud computing allows companies to store their files and applications in remote data centers, rather than on local hard drives.
Merger-and-acquisition (M&A) activity will also continue to reshape the IT industry, with about 80% of those surveyed indicating that their companies will likely be involved in some kind of deal in the next two years. Those surveyed also said that access to new technology and products (69 %), and product synergies (50 %) will be the most important drivers of alliances, mergers, and acquisitions over the next 12 months.
About half of the respondents also said that they intend to expand their workforces during the next year.
"Technology executives clearly see a sustained recovery and a strong appetite for technology related purchases by US companies and consumers, which helped raise the position of the US market. Coupled with demand from emerging market countries, this combined opportunity bodes well for the industry," said Gary Matuszak, Partner, Global Chair and US Leader for KPMG's Technology, Communications & Entertainment practice.
"They also intend to take advantage of their strong liquidity and cash positions by investing in emerging technologies and new business models, like Cloud, and new products and services, as well as M&A to drive revenue."
From the buyer side of the market, IT management research firm Computer Economics surveyed more than 200 IT executives for its annual IT Spending and Staffing Benchmark study. In that study, whose results were just released, 60% of the respondents said that they planned to increase their operational budgets, an improvement from last year, when 44% indicated that they had plans to decrease IT spending.
Also, for the first time, companies plan to spend as much on new software projects as they do maintaining existing systems, according to a new report from Forrester Research. Forrester surveyed more than 2,400 IT executives and technology decision makers in North America and Europe for its study.
Business intelligence) is the top-priority software category, with 38% of Forrester respondents saying they plan to install it or expand their current implementations.
Collaboration (37%) and customer relationship management (CRM at 35%) rank next on the new projects list, surpassing back-office software such as enterprise resource planning (ERP) and human capital management (HCM).
Only 21% of those surveyed by Forrester named software consolidation as a priority for this year, down from 36% in 2008.
Growing cloud computing adoption, led by software-as-a-service (SaaS) also means that companies are increasingly comfortable with heterogeneous application environments, so supplier rationalization is not seen as so critical anymore.
Thirty-four percent of respondents considered SaaS of high importance, an increase from 22% three years ago. SaaS adoption will stand at 37% and grow to more than 50% next year, according to Forrester.
In addition, nearly half of those surveyed are now developing or "have concrete plans" for mobile applications. Share wisely, and take care.
Cloud Computing to Reach $490 Million by 2014
Excerpted from Planet Insane Report by Andrew Gilbert
Recent reports indicate that the cloud computing business is estimated to reach approximately $490 million by 2014 up from $94.5 million in 2010. This could come as an eye opener to solution providers who questioned the relevance of cloud computing.
IDC has just released a report which said that 76% of Indian companies were contemplating the use of cloud computing by the end of 2011, while 14% are already on the public cloud.
So, solution providers will have to get their act together, if they want to make some money in the cloud computing business. The early birds will be able to pick up cloud services faster and also win customer loyalty.
Solution providers are weighing the pros and cons of hawking packages which are branded or developing their own white label services. According to Gartner, the market for cloud service brokerage will prove to the largest single revenue earner in the cloud computing business by 2015.
Gartner also forecasts that large IT organizations are likely to sell services directly in the market and would be looking for partners. Experts in cloud computing say that since developing their own services might take time, companies should focus on retailing branded services. This would give the companies a better notion on what the market requires and come up with services which are more relevant to the market.
The shift to cloud computing would require a change in mindset and is not likely to be easy. Companies will have to be more focused on the revenue from commissions rather than being focused on the top line.
Financially, companies who wish to get into cloud computing will have to develop an annuity model. The major change will come in sales where selling practices have to be modified, new relationships with customers have to be build and incentives for the sales team will have to be altered.
Rising Markets: Media M&A Hits $23 Billion
Excerpted from Online Media Daily Report by Gavin O'Malley
Media M&A activity is gaining momentum again.
Last year marked a major comeback for media, information, marketing services, and technology M&A activity. And while slightly less dramatic, related moves continued to gain speed during the first half of 2011, according to Jordan, Edmiston Group.
During the first half of the year, the value of announced transactions reached $23 billion - a 15% increase over the first half of 2010 - on a similar volume of M&A deals.
By contrast, the first half of 2010 saw a 61% surge in deal volume, and an increase nearly four times in transaction value over depressed 2009 crisis levels.
Continued growth in 2011 on top of the major rebound last year reflects a healthy continuing M&A environment, according to JEGI.
Interactive marketing services and technology markets continue to account for the majority of deal activity and value, with the B2B and B2C online media and technology, marketing and interactive services, and mobile media and technology sectors accounting for 71% of total deals and 63% of deal value in the first half of 2011.
Please click here for the rest of the report.
Comcast Exec to Networks: "We Have to Get Out of Our Own Way"
Excerpted from AdWeek Report by D.M. Levine
"We have to get out of our own way." That was the message Matt Strauss, Comcast's Senior Vice President of Interactive Media had for his fellow panelists at the opening of the PromaxDBA conference in Midtown Manhattan Tuesday.
At points, Strauss sounded a chiding note, saying that the networks are acting too slowly to bring their content to a variety of different video platforms. "People don't care; they don't want to hear why certain things are on certain platforms. They just want it," he said. The future of "television" that Strauss envisions doesn't center on traditional TV at all, but on the plethora of portable and nonportable devices- from iPads to laptops to phones and Internet-enabled flat screens - that viewers are increasingly turning to for their video content.
To their credit, it was a point the network executives also on the panel seemed to concede. And so, they said, in this world of increasingly fractured audiences, brand is king. The networks that successfully retain eyeballs will be the ones who have an articulate brand that viewers can latch on to. "Brands are more important than they've ever been," said A&E Network President Bob DeBitetto. "People are making decisions about how they spend their time. And the brands matter."
Still, as Cooking Channel General Manager Michael Smith pointed out, not everyone in the television industry is moving in the right direction on branding. "One of the good things about cable is that we got good at branding networks," Smith said. "But now everyone is trying to become general entertainment again. I can't tell whether that pregnant teenager is on TLC or MTV. It all kind of blends together."
In addition to DeBitetto and Smith, Strauss, a regular at these sorts of conferences, was joined on stage by Ed Carroll, COO of Rainbow Entertainment Services, USA Network Co-President Chris McCumber, and moderator Donny Deutsch.
TiVO Skips Past the DVR
Excerpted from The Jerusalem Post Report
TiVO disrupted the TV industry when it invented the digital video recorder (DVR) in 1997. Now that 40% of US households have a DVR, the company should be swimming in riches. Instead, TiVO's DVR business is in free-fall, bleeding money in 10 of the last 11 years with more than half of its subscriber base abandoning the service in the last three years.
Last month, the company was given a fresh start, courtesy of a $500 million legal settlement with DISH Network. Tom Rogers, TiVO CEO, shares his perspective about the future of television, why Nielsen has it all wrong and his plans for spending half a billion dollars.
"TV began as a very social medium. Now it has devolved into a solo, isolated activity. The user experience is not commensurate with the technologies available and has fallen behind other platforms. TV is still the principal media experience but there is a lot of great content that you can't get from the set-top box (STB). We are helping pay TV operators bring over 7 million pieces of content, including music, online video, pictures, etc from the Internet right to your TV set."
TiVO's opportunity is clear- there are 160 million STBs in the US, almost none of which support advanced television features. For example, Internet radio provider Pandora surpassed 100 million subscribers last month while over-the-top (OTT) video service Netflix grew to over 26 million subscribers as 176 million Americans viewed online video last month.
Facebook also continued to absorb a greater proportion of online media consumption. Unfortunately, none of these experiences are accessible from most pay TV STBs, explaining the rapid growth of devices like Roku, Boxee and Apple TV.
"The world of mobile phones, tablets, and Internet has put power in the hands of consumers. That did not happen with television. The pay TV ecosystem missed the boat with the social experience. TiVO's new products help operators bring TV back to the center of the media world."
TiVO is adopting a sue 'em and woo 'em strategy. While litigation continues with Microsoft, Verizon, and AT&T, the focus is on selling software to the operators. "We make hardware solely to effectuate deployment. Our technology is not hardware dependent. Or you can build our software into someone else's hardware - we don't care."
Not being a hardware player helped TiVO win its first deal with a cable operator, replacing Motorola. "We don't make money on the hardware but will provide it for cable companies to reach their audience. As a result, we have the ability to be a cost-effective alternative for cable companies."
Rogers is adamant that advanced television requires better audience measurement. TiVO is taking the fight directly to Nielsen. "The current system has not kept pace with advertiser needs," says Rogers.
As the former President of NBC's cable operations, he calls TiVO's second-by-second StopWatch ratings service "long overdue. Nielsen does not adequately differentiate between when an ad is being watched and when a show is being watched. When you have a high percentage of people skipping the ad, Nielsen really doesn't provide an accurate view. TiVO can help determine what ads work, where they work, and when."
TiVO launched its own real-time, minute-by-minute audience measurement service called StopWatch. To help marketers and agencies understand the service, earlier this year the company launched a free site, ScoreCard, to assess campaign effectiveness, viewer retention and performance relative to other brands.
The burning question for shareholders and technology start-ups alike is how will TiVO spend the $500 million? Don't expect a dividend. "We are more inclined toward a buyback," says Rogers. This would also help offset dilution from a recent convertible bond offering.
"TiVO is interested in acquisitions. However, we are seeing great organic growth for our TiVO premiere products." In the slow-moving world of pay TV technology providers, the DISH settlement will enable TiVO to skip past the DVR era.
TV Holds: Young Adults More Likely to Media Migrate
Excerpted from Media Daily News Report by Wayne Friedman
More studies reveal cord-cutting isn't a threat to traditional TV distribution systems - yet.
Just 3% of subscription TV consumers are "cutting the cord" of TV distribution systems - cable, satellite, or telco - per a survey from consumer researcher J.D. Power and Associates.
Of those surveyed, young adults 17-34 are the most likely to cut the cord - 6% say they no longer subscribe to a residential television service.
Of those ages 35-46, 4% are going without traditional TV service; for older consumers 47-65, the number is 2%.
Frank Perazzini, Director of Telecommunications at J.D. Power and Associates, stated: "The popularity of services such as Netflix and Redbox is a clear indication that consumers are enjoying the availability of alternative viewing options."
He adds: "However, with 52% of television customers reporting that they still watch regularly scheduled programming as it is broadcast, the current model will remain viable for the next two to three years, at a minimum."
More than one-fourth (27%) of video service customers watch videos on a handheld mobile device such as a music player, mobile phone or tablet, according to the study. Mobile phones are still the most commonly utilized handheld mobile device for watching videos - 15%.
Tablets have a 12% video use rate among customers. Music players also currently hold a 12 percent share.
J.D. Power says video service satisfaction is above average when customers use mobile devices and music players to access content. Overall satisfaction with pay-to-view video service providers averages 743 on a 1,000-point scale. Netflix and Redbox perform particularly well in satisfying pay-to-view customers.
The study, done in April 2011, looked at 6,815 U.S. homes that evaluated pay-to-view providers, including Amazon, Apple TV, Blockbuster/Blockbuster Express, Google TV, Hulu/Hulu Plus, local video stores, Netflix and Redbox.
Why Now Is the Time to Shift TV Ad Dollars to Online Video
Excerpted from Video Insider Report by Mike Sullivan
The advertising industry's focus is dramatically shifting. Just a few years ago, ad buyer options were limited to print, mail, radio, and TV advertising. Today, few campaigns can be considered even remotely relevant or complete if they don't include online, video, social, mobile, and more.
This is putting a lot of pressure on both advertisers and publishers to create successful online advertising campaigns and programs with measurable return on investment (ROI) and visibility into exactly where ads appear.
Online video viewership is reaching new highs each month, presenting a perfect opportunity for media buyers to tap into the massive video audience. New research from Nielsen revealed that during April 2011, Americans streamed 14.7 billion videos, a record for the most streams in a month. In addition, non-premium video site YouTube's usage was at an all-time high in April 2011, with viewers watching 8.7 billion streams, up seven percent from the previous month. Yet most advertisers are still only comfortable buying the 10% of premium online ads that offer comprehensive data about their content.
Media buyers commonly believe that online videos can't be measured with traditional TV metrics such as Target Rating Point (TRP) and Gross Rating Point (GRP). Recently, new technology has emerged that can provide the same rating points and can also accurately determine the content of the video, offering a chance for ad buyers to take early advantage of the 90% of non-premium online video inventory, yet to be claimed.
Advertisers are also becoming more rigorous in how they target social or viral online video ads and are beginning to turn to more detailed data than audience impressions for measurement. Viral and social online videos often have a much higher niche audience engagement, with successful videos achieving several million views. This content is non-premium, and is therefore much more affordable to advertisers than expensive premium videos. Social media can also offer more detailed metrics than traditional TV advertising, such as how often an ad was passed along on social networking sites and social engagement including tweets, Facebook "likes" or comments.
In summary, ad media buyers have been reluctant to buy ad space for online videos as this content hasn't offered the same level of transparency. As a result, ads could potentially run alongside inappropriate or controversial videos, with potentially devastating results for the brand.
Now advertisers can have total clarity about online video content and total control through custom channels that allow them to select the exact online videos where they'd like to advertise. From specific subjects such as extreme sports or wine tasting, to exact channels such as ESPN and TNT, advertisers can now target their ads and engage audiences with the same precision for online video that they have with traditional TV spots.
A clear opportunity exists for innovative media buyers to shift ad dollars from TV to online video, and claim these devoted, loyal and highly focused online audiences first.
Level 3 and Extreme Reach Partner on Video Ad Facility
Excerpted from Streaming Media Report by Troy Dreier
MA-based Extreme Reach, which provides video advertising solutions, is building a new facility in Burbank, CA, and it's working with Level 3 to get it done. The new facility will be used for in-house production services, with the goal of creating the largest video ad delivery network. Level 3 is a crucial part of that, as Extreme Reach will use Level 3's network for connectivity and its services to optimize video delivery.
The new facility will serve as Extreme Reach's primary West Coast sales and service center. Level 3 will allow to facility to scale as its clientele grows.
"Our agreement with Extreme Reach illustrates the increasing influence of high-quality digital content as a communication tool in advertising and beyond, and this content explosion necessitates network solutions that support the intense bandwidth requirements," says Andrew Crouch, President of Sales for Level 3. "We are delighted that our network services are able to support Extreme Reach's customers' needs for a robust digital video advertising management and distribution solution."
"Our company is expanding rapidly, and we need a network partner that will not only grow with us, but also provide the level of service that enables us to expand our capabilities," says Tim Conley, COO of Extreme Reach.
BitTorrent Protocol Sends Data when There's Enough Capacity
Excerpted from Fierce Broadband Wireless Report by Monica Paolini
Data caps have become the first line of defense of mobile operators against network congestion. But it is becoming increasingly obvious that imposing limitations on traffic allowances is not an effective tool to manage traffic, and in fact it may have unintended negative effects on congestion (more on this later).
As we argued here, sufficiently generous data caps are necessary to protect networks from abuse, but they usually affect only a very tiny percentage of subscribers. In the US, for instance, 5% of users account for 68% of traffic, according to Sandvine. Still, stringent data caps that apply to all subscribers risk to alienate many of them, because most do not know that they do not fall in the 5% high-usage group.
Most importantly, operators want to drive up subscriber adoption and satisfaction, and that inexorably means more traffic. Other things being equal, more traffic means more base stations to increase capacity, and therefore more capital and operating costs, and, eventually, lower profitability. Clearly this is an unsustainable model in the current situation where traffic is increasing very fast, but ARPUs are at best stable.
But does it have to be this way? In our analysis of traffic growth in the report mentioned above, we identified multiple drivers to traffic growth that bring uneven contributions to the overall traffic profile. To manage traffic effectively, we argued that addressing different traffic growth drivers independently, with the tools that are more appropriate to it, allows the operators to decompose the traffic load issue and make it more manageable. For instance, with regards to location, traffic is increasing both in high-density public areas and from home, but the increase in capacity density that is required is likely to come from different topology solutions - e.g., small cells will help in public areas but not in residential areas, where femto cells are better suited.
Luckily for mobile operators - and for subscribers - there is quite a lot of room to improve the utilization of mobile networks without any costly equipment upgrade or addition. This is not to say that mobile operators can avoid investing in network expansion - which is clearly necessary - but simply that that are way to use the existing infrastructure more efficiently that may reduce the scope of the expansion needed (or at least let subscribers have more fun).
Inevitably, no network, either fixed or mobile, is used at 100% capacity. Networks are dimensioned to cope with peak traffic demand, so during non-peak hours they typically carry less traffic than they have capacity for. In mobile networks, the time-of-day distribution of data traffic load shows a clear peak in usage around 9:00 PM and 10:00 PM, with the lowest level of usage in the middle of the night as expected, where traffic load can be one third or one fourth of peak traffic. This distribution is fairly constant across countries, and very similar to wireline time-of-day traffic distribution.
What if we could flatten the time-of-day distribution, so that the idle network resources in the middle of the night can be used more extensively? This will have the obvious effect of increasing the overall network throughput at a almost-zero marginal cost to the operator. Capex and opex depend on peak traffic, and traffic during non-peak hours is virtually free.
The benefits are obvious, but so are the challenges to any attempt at flattening the time-of-day distribution. Subscribers want to use their data plans when they want, and they will not stay up all night simply because their data connection may be faster. That is why we have peak hour in the first place: people tend to like to congregate in few places, and do similar things at similar times. So is it hopeless to try increase traffic load in non-peak times?
Enter the scavenger app.
Eric Klinker, CEO of BitTorrent, very aptly uses the "scavenger class" term to refer to applications like file sharing which have low priority requirements - so low, in fact, that they can fit below the best-efforts class.
File sharing is one of the major culprits of network congestion accounting for 30% of mobile traffic according to Allot Communications - although video streaming is becoming the worst offender with 37% of traffic - and BitTorrent is a major contributor, accounting for 21% of mobile data traffic in North America according to Sandvine.
In wireline networks the percentage of file-sharing traffic is even higher. BitTorrent realized that it needed to act from its end to reduce the impact of the massive amount of traffic its clients generated. It developed a transmission protocol that enables BitTorrent traffic to be carried only when the traffic load on the network is sufficiently low that the additional traffic does not slow down other active applications.
In both fixed and mobile networks, transmission control protocol (TCP) is the dominant protocol to transmit data, as it has error correction which ensures that packets are correctly received, and its own congestion control to provide reliable transmission in high-traffic environments.
All TCP traffic competes for the same resources and, although QoS can be used to prioritize traffic, it still manages all traffic within the same framework, with the lowest class, best-efforts, including most data applications, with the exception of real-time ones, like voice or video streaming.
BitTorrent's micro transport protocol (uTP) creates the "scavenger class" to transmit data below the best-efforts level, using user datagram protocol (UDP), which is simpler than TCP and lacks its own congestion control. uTP continuously measures the delay in packet transmission to estimate congestion. If there is no congestion, it transmits data; if the traffic level is too high, it graciously waits until congestion clears.
The BitTorrent approach to congestion is a very compelling model that can be extended beyond file-sharing applications, to include software upgrades or content downloads that do not have to happen in real time (e.g., downloads of video content that can be downloaded overnight, and stored to be viewed during the day).
Applications that can send low-priority traffic during non-peak time can substantially spread out network utilization and effectively increase network throughput by reducing peak traffic in a way that is cost-effective (free to mobile operators, and relatively cheap to application providers), and does not have a negative impact on subscriber's experience.
In fact, the lower traffic load during peak hours may result in an improved subscriber experience as the impact of congestion is reduced.
If this is such an effective and low-cost approach that keeps subscribers happy, why is it not more widely used? There are many reasons, among which the fact that there is no standardized solution that can be adopted by myriad of application developers in the fragmented mobile market.
But perhaps even more importantly there is little incentive for subscribers to use (if available) or demand (if not) scavenger apps--all their traffic equally counts towards their monthly allowances, so why bother being good citizens? And how would they need to play nice in the first place, when operators do not openly acknowledge that congestion is an issue they are facing and instead prefer to argue about who has the fastest 4G (sic) network?
This is exactly where traffic caps fail. By making all traffic equal, regardless of time, place, or network traffic load, operators encourage data thriftiness among subscribers. Instead of using their network efficiently, by for instance scheduling traffic downloads at off-peak hours, they try to limit their use to the more important applications.
And the data usage that is more important to subscribers tends to be during peak times and, as a result, data caps may encourage a time-of-day distribution that is even spikier than it is in an unlimited data plan regime.
Plans without punitive data caps, or data caps that exclude peak hours may instead reduce peak-time traffic, as they encourage subscribers to download what they may want ahead of time, without worrying to go beyond their monthly allowance.
For the operator, the small reduction in peak time traffic is well worth the increase in traffic during off-peak hours. For the application developer, having to keep network congestion into account is additional work, but also an opportunity to differentiate apps, and add value. And the subscriber no longer has to worry about maxing out the data allowance before the end of the month.
Virtustream to Demonstrate its Enterprise Cloud Computing Approach
Excerpted from TMCNet Report
Virtustream, a cloud provisioning firm, announced that at the GigaOM Structure 2011 it will be demonstrating its enterprise cloud computing approach.
Virtustream claimed that its approach is capable of meeting the most demanding IT and data center requirements and along with its customer, Florida Crystals/Domino Sugar, will present the details about how a pragmatic, visionary process can be employed to realize cost savings and performance improvements based on the sugar company's cloud deployment.
Officials with the company ascertained that the story of Domino Sugar's cloud deployment demonstrates a new chapter in cloud computing - more and more companies are looking to Virtustream for enterprise cloud deployments that are based on a real-world assessment of how to best capitalize on the new compute deployment models as well as Virtustream's expertise with critical enterprise applications.
They will showcase the Domino Sugar story at Structure in a session moderated by Derrick Harris, who was among the first journalists to understand the emergence of the enterprise cloud and its importance.
Virtustream added that it provides a number of cloud-based solutions that focus on supporting the enterprise application market and its cloud provisioning algorithms are designed to offer superior security and performance of a private enterprise cloud while leveraging the efficiencies of multi-tenant cloud economics.
Also clients can purchase the amount of infrastructure resources they need as multi-tiered workload infrastructure units with integrated High Availability and Disaster Recovery.
Virtustream's cloud computing platform, xStream, leverages virtualization technologies into an infrastructure service platform that removes the obstacles many organizations face when electing to transform their infrastructure.
Among many distinctions, Florida Crystals/Domino Sugar's xStream deployment represents one of the largest SAP production environments running in a multi-tenanted private cloud.
Some of the notable features of Virtustream's xStream platform include: guaranteed resources; compliant with highest international; security & system standards; capacity on demand; easy to manage; highly scalable; flexible pricing mode; and more.
Distributed Computing Will Help Fend-Off Cyber Attacks
Excerpted from Wall Street Journal Report by Nick Clayton
The infamous industrial computer worm, Stuxnet, caught the world's attention in 2010 for its sophistication. But such attacks remain a low risk to most organizations.
Much more likely are lower level threats. According to market research company Infonetics, the worldwide market for desktop and mobile security clients is forecast to pass $7 billion by 2015. The biggest growth is projected to be in mobile security clients.
This is driven by the increasingly rapid uptake of devices running high-level mobile operating systems. With increasing use of mobile devices, traditional perimeter defense methods, such as firewalls, are less effective.
Coupled with a move to distributed cloud-based computing, security will likewise become distributed. According to Accenture, IT security will move from simply securing information systems, to securing processes.
In a distributed computing environment, physical security becomes an impossible task. Most of the devices which are likely to be connected to the Internet of things are cheap sensors. which would appear to have access to relatively little valuable data.
However, if anything can be made to misbehave remotely, there is likely to be somebody who will want to exploit it. Securing an Internet of things of 50 billion devices is simply impossible.
No one expects attacks on corporate sites to decrease. According to security specialists Symantec, so-called "spear-phishing" attacks which are highly targeted to a particular individual or group, are likely to increase.
As the market prices of black market data shows, while credit card numbers can be bought for a few cents, rich personal data commands prices of hundreds of dollars. Such rich data can be used to launch attacks.
The quantity of malware is staggering. In 2010 there were 286 million unique pieces of malware detected that launched in excess of 3 billion attacks globally. One of the most notorious, Zeus, which targets financial information, went from costing $100,000 to protect against, down to a few hundred dollars and finally to being released as open-source shareware.
Interoperability Is the Top Cloud-Computing Hurdle
Excerpted from Channel Insider Report by Nathan Eddy
The greatest challenge facing longer-term adoption of cloud computing services is not security, but rather cloud interoperability and data portability, say cloud computing experts from IEEE, a technical professional association. At the same time, IEEE's experts say cloud providers could reassure customers by improving the tools they offer enterprise customers to give them more control over their own data and applications while offering a security guarantee.
Today, many public cloud networks are configured as closed systems and are not designed to interact with each other. The lack of integration between these networks makes it difficult for organizations to consolidate their IT systems in the cloud and realize productivity gains and cost savings. To overcome this challenge, industry standards must be developed to help cloud service providers design interoperable platforms and enable data portability, the organization said.
"Security is certainly a very important consideration, but it's not what will inhibit further adoption," said Dr. Alexander Pasik, CIO at IEEE and an early advocate of cloud computing as an analyst at Gartner in the 1990s. "To achieve the economies of scale that will make cloud computing successful, common platforms are needed to ensure users can easily navigate between services and applications regardless of where they're coming from, and enable organizations to more cost-effectively transition their IT systems to a services-oriented model."
According to industry research firm IDC, revenue from public cloud computing services is expected to reach $55.5 billion by 2014, up from $16 billion in 2009. Cloud computing plays an important role in people's professional and personal lives by supporting a variety of software-as-a-service (SaaS) applications used to store healthcare records, critical business documents, music and e-book purchases, social media content, and more.
However, the IEEE said lack of interoperability still presents challenges for organizations interested in consolidating a host of enterprise IT systems on the cloud. According to IEEE Fellow Elisa Bertino, professor of Computer Science at Purdue University and research director at the Center for Education and Research in Information Assurance, the interoperability issue is more pressing than perceived data security concerns.
"Security in the cloud is no different than security issues that impact on-premises networks. Organizations are not exposing themselves to greater security risks by moving data to the cloud. In fact, an organization's data is likely to be more secure in the cloud because the vendor is a technology specialist whose business model is built on data protection."
However, Steve O'Donnell, an IEEE member and former global head of Data Centers at BT in the United Kingdom, suggested much of the concern is about control for IT managers. "There's a lack of enterprise tools that enable management of security and availability in the cloud in the same way as in a data center," he said. "Enterprises believe their own data centers are secure and available, and want to own the management of cloud security and availability rather than outsourcing it to a third party."
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