May 11
28
Online Video Might Pose Problems for Providers in Year to Come
It’s no secret that people are using the Internet more than ever these days, but it’s the type of data that they’re transferring that has Internet service providers (ISPs) and networking companies worried.
By 2014, Cisco Systems estimates that Internet traffic will reach 64 exabytes a month, which is over 12 times more traffic than in 2006. The reason for the increase in traffic? Online video.
With providers offering consumers the ability to watch their favorite movies, television shows and video clips online, the strains on the network are growing. In addition, the costs related to providing video over broadband are growing increasingly less attractive for providers. There are no meters to measure bandwidth usage for consumers, which means that there’s a “revenue per bit” problem for Internet service providers. The person who logs in to check their email once per week pays the same rate as the person who streams 30 gigabyte movies on a consistent basis, even though the latter is using far more bandwidth.
By 2014, the total investment needed to upgrade and stay competitive may be more than many ISPs can handle. Ultimately, there needs to be a change to the basic business model of ISPs – which may mean higher costs for consumers.
