TV Economics TV Economics

The core success of a business is based on its ability to facilitate profitable business models. Octoshape has now successfully replicated the economics that exist for the distribution of broadcast TV to TV-quality video over the Internet.

What is the problem?

Today, the standard way that content distribution networks charge for their video distribution services is “per GB”. This is a “freight” based charge where the content distributor pays the distribution provider a price for every Gigabyte that is served to an end user. The problem with this model is that the number of Gigabytes generated is variable along three tangents.

  1. Quality: Raising the bit rate from 500 kbps to 2 Mbps is 4 times the gigabytes served, and therefore 4 times the cost.
  2. Audience Size: Based on the popularity of the content, or the time of day, or day of week will depend how many people watch. Doubling the audience size doubles the cost.
  3. View Duration: If the audience watches for 1 hour instead of 30 minutes, the cost is again doubled.

Businesses simply cannot predict their cost. They often over provision for scale and throw away money, or under provision for scale and alienate their audience. They often hold back the video quality to manage their cost exposure, which in turn also reduces the audience view times, again disenfranchising the audience. This does not foster an environment of success and expansion for any business.

What is the solution?

The Octoshape suite of Multicast technologies has enabled a distribution platform that is free from these variables. Broadcasters are no longer constrained by quality, audience size, and view duration exponentially increasing their costs.

Octoshape has enabled a federated network of last mile providers to multicast-enable the Internet access for their customers, providing efficient and predictable cost for linear distribution of video over the Internet. This allows Octoshape to offer fixed cost distribution services over this network, replicating the economics of Broadcast TV over the Internet.

Private Multicast HD-M