Broadband delivery newcomer PrediWave has developed a technology that could radically alter the way video-on-demand and other interactive content is delivered. In its new form of delivery, the bandwidth is allocated to the content rather than to the consumer, an approach unlike that of most standard VOD systems.
Tom Elliot, senior adviser, new business development, believes PrediWave’s technology can fundamentally change the economics of VOD. Most VOD providers allocate a port on each server and a certain amount of bandwidth for each customer. When a customer orders a movie, that customer receives a dedicated stream of the film to his or her home.
Prediwave approaches the delivery from the opposite direction. PrediWave’s technology, based on complicated mathematical algorithms, sends the packets of data, or content, in a way that maximizes the bandwidth by assigning it to the content rather than to the traffic, which is subject to change. To do this, PrediWave places two movies on one standard 6 MHz channel instead of assigning a server port to each customer. If one or 1,000 customers were watching the same movie on a PrediWave system, only half a channel would be needed in each case.
The economic value for cable operators that use PrediWave’s technology is in the reduced number of servers and associated ports needed to serve the customer base. “The real issue is breaking the back of the 1:1 connection for each customer. We have a port per movie instead of a port per customer,” Mr. Elliot said. “You’re really limited by bandwidth as to how many you can serve [in most systems]. We can serve an infinite number of people. We really operate in a broadcast mode where we send out one to many,” he said.
The tradeoff is that a PrediWave system requires more bandwidth at the get-go, since each movie requires half a channel.
Mr. Elliot said that problem can be solved if cable operators implement a hybrid VOD system where they move the hot titles that generate the majority of traffic to the PrediWave system while offering the rest of the library on whatever system is already in place. “To offer a real deep catalog, you would do a mix,” Mr. Elliot said.
Also, if a cable system only had two channels to dedicate to VOD at all, PrediWave would make sense, since you could offer the most popular movies on those two channels and probably serve close to 80 percent of the customer demand, he said. “If you had limited bandwidth, you would do PrediWave,” he said.
The technology has been tested in China in about five trials, serving several thousand customers with the Beijing Cable Co., and will be deployed with the Southeast Cable Network beginning in January with an initial 200,000 set-top boxes to customers in Fujian Province, China.
“PrediWave is an on-demand, total digital broadband delivery system. The killer app of it is VOD,” Mr. Elliot said. The technology is insensitive to the content, so PrediWave could deliver Internet content, graphics or games.
PrediWave, based in Fremont and San Jose, Calif., will demonstrate its VOD technology for the first time in the United States at the Western Show in Anaheim, Calif., this week. However, penetrating the domestic market won’t be easy. The technology would need to be licensed by the two main set-top box makers, Motorola and Scientific-Atlanta, to be incorporated into their boxes. Mr. Elliot predicts U.S. deployment is about 18 months away.
PrediWave’s technology solves a lot of the bandwidth problems faced by multiple system operators, said Frank Barbieri, partner with Filter Media in Boston, an interactive TV consulting firm. “I do think these type of systems are the wave of the future. MSOs’ [return on investment] accelerates faster because you don’t buy as many servers,” he said. “They are essentially doing some clever topological tricks to solve some bandwidth inefficiencies.”
Mr. Barbieri said PrediWave could be an acquisition target for an entrenched VOD provider like SeaChange or Concurrent Computer Corp., enabling one of those companies to offer a complementary PrediWave solution.