Welcome to the fourth edition of Open Insight, the first this year. I’m pleased to share some of the latest developments as we continue our focus on building our core operations business. The pandemic hasn’t yet released its grip on the world but, like everyone else, we’re hoping for a return to more normality as vaccinations are available.
Open Insight #4 in Swedish
With lockdowns forcing people to stay at home, the pandemic has made staying connected, entertained, and informed more important than ever. Working from home is expected to become a much more regular thing for many people in future. This is leading many of our customers to plan for growing demand for video in the home. For example, Tata Communications, has seen average daily consumption of streaming services increase from 40-50 minutes to more than 190 minutes, with some consumers signing up to three new streaming subscriptions during lockdown. In order to create the capacity it needs, Tata is currently upgrading its global network capacity to 100G, using our Nimbra solution.
Long-term changes are also happening in the way that content is created. Of the approximately 5,000 sporting events that Tata currently distributes, 750 are produced remotely (meaning that broadcasts are edited in a different location to recordings). Tata forecasts that around 1,800 to 2,000 events will soon be produced remotely. We are well placed to support Tata, and other customers, with this ongoing shift toward remote production with our Nimbra and Aperi solutions.
As I explained earlier, our strategy is to focus on our core operations in Media Networks, with Nimbra at the center. Last year, we divested Sye and also plan to divest ScheduALL. We also acquired Aperi’s product portfolio to complement Nimbra by extending the range of environments and price points that we support.
Partnerships broadening our market
Strategic partnerships are another key part of delivering on our growth plans. We recently signed two new partnerships that enable us to offer new, joint capabilities to customers. Alongside Wipro, a global IT and outsourcing company, we will extend our offering to new markets. Wipro has a global customer base that will now have access to the capacity provided by our Nimbra products, including through its PaaS (Platform as a Service) offering, which makes advanced video distribution services available to companies of all sizes. Read more here.
Our other new partnership is with Simplylive, which offers cost-efficient live production solutions to medium-sized and smaller producers. This includes many sports, music or corporate events where it hasn’t previously been technically or financially viable to support high-quality broadcasts. Simplylive will offer Nimbra Edge as part of a package alongside its production software. This means that the benefits of Nimbra will be available to a much wider market and the partnership further strengthens our position in the fast growing market for cloud based media workflows. Read more here.
New more flexible pricing model
We also continue to offer our customers more flexible payment models, to support the transition away from hardware towards software-based solutions. This enables customers to buy continuous updates rather than purchasing equipment, working in longer term partnership with us. This can be especially important to customers entering video distribution markets for the first time, where the threshold for investing in equipment can be higher than for larger, established operators. By moving from Capex to Opex they benefit from less tied-up capital, reduced risks in uncertain times, and can try out new services without committing to specific technology. They can also more easily upgrade solutions if their business goes well.
Time synchronization important for 5G
In the second issue of Open Insight, I told you about a pilot study for a research project that we are carrying out alongside Sweden’s innovation agency Vinnova and The Royal Institute of Technology, KTH. The background is that time synchronization in 5G networks requires much higher accuracy than in 3G and 4G networks. This can be achieved via satellite systems such as GPS or Gallileo, or by upgrading networks with new equipment. The first option can significantly reduce security and reliability, as signals can be disrupted. This has led some countries, including Sweden, to require alternatives in their 5G tenders. Meanwhile, the second option of replacing equipment would incur considerable costs. To be able to synchronize through existing networks would save a great deal of money.
Net Insight has technology that enables synchronization of video and digital TV signals using the network for distributing time, without using GPS. The Vinnova/KTH project will investigate how this could be applied to 5G and mission-critical infrastructure. This could have significant potential when 5G roll-outs accelerate across a broad range of applications. The project will verify the potential and identify suitable solutions which will then be tested by a Nordic mobile operator. A lot of work remains to be done, but we could open up opportunities to support the mobile networks of the future. We will review the pilot study carefully and I will revert with more information about the project as it progresses.
In order to develop our time synchronization work further, we have also initiated a collaboration with German company Meinberg, a world-leading specialist in time synchronization applications, which I also mentioned in issue 2 of Open Insight. Time synchronization is becoming increasingly important in media production as the market transitions to IP-based production and distribution flows. Meinberg’s products complement Net Insight’s in these applications, but we have also initiated joint customer talks in other market segments and are evaluating a closer product collaboration.
I believe exciting times lie ahead. I am looking forward to the vaccination roll out and the economic recovery that lies ahead.