AT&T and Augmented Reality

Lately it seems like I find a news article almost every week talking about new ways that people are using broadband. The latest news is an announcement that AT&T is selling Magic Leap augmented reality headsets in six cities plus online.

The AT&T launch is being coordinated with the release of an augmented reality immersive experience that will bring The Game of Thrones into people’s homes with a themed gaming experience called The Dead Must Die, with a teaser in this trailer.

Augmented reality differs from virtual reality in that augmented reality overlays images into the local environment. A user will see characters in their living room as opposed to being immersed in a total imaginary environment with virtual reality.

Magic Leap is one of the most interesting tech start-ups. They started in 2014 with a $542 million investment, and since then have raised over $2.3 billion dollars. The company’s investors and advisors include people like Alibaba executive vice chair Joe Tsai and director Steven Spielberg. There have been rumors over the years of an impending product, but until now they’ve never brought a product to market. AT&T will be selling Magic Leap’s first headset, called the Magic Leap One Creator Edition for a price of $2,295. The mass-market headset will surely cost a lot less.

AT&T’s interest in the technology extends past selling the headsets. Magic Leap recently signed a deal with the NBA and its broadcast partner Turner which is now owned by AT&T and will obviously be looking at augmented reality broadcasts of basketball games.

AT&T’s interest goes even far beyond that and they are looking at the Magic Leap technology as the entry into the spatial Internet – moving today’s web experience to three dimensions. AT&T sees the Magic Leap headset as the entry into bringing virtual reality to industries like healthcare, retail and manufacturing. They envision people shopping in 3D, doctors getting 3D computer assistance for visualizing a patient during an operating, and manufacturer workers aided by overlaid 3D blueprints on the manufacturing floor.

While the Magic Leap headset will work on WiFi today, AT&T is promoting Magic Leap as part of their 5G Innovation Program. AT&T is touting this as a technology that will benefit greatly from 5G, which will allow users to go mobile and use the augmented reality technology anywhere.

I couldn’t find any references to the amount of bandwidth used by this first-generation headset, but it has to be significant. Looking at the Game of Thrones application, a user is immersed in a 3D environment and can move and interact with elements in the augmented reality. That means a constant transmission of the elements in the 3D environment. I have to think that is at least equivalent to several simultaneous video transmissions. Regardless of the bandwidth used today, you can bet that as augmented reality becomes mainstream that content makers will find ways to use greater bandwidth.

We are already facing a big increase in bandwidth that is needed to support gaming from the cloud – as is now being pushed by the major game vendors. Layering augmented reality on top of that big data stream will increase bandwidth needs by another major increment.

Live Streaming on the Internet

olympic-rings-on-whiteI wrote recently about how Sling TV had problems with the NCAA basketball games, and particularly with the final game between Kentucky and Wisconsin. I watched the Maryland games in the first two rounds of the tournament and reported how awful my experience was.

But Sling TV is not the only one to have trouble with live streaming. I recall last year when HBO Go had a terrible crash with the streamed season premier for Game of Thrones. And the Oscars last year also failed when ABC tried to stream the event.

Live streaming is just that – it’s when a live event is being put over the Internet in real time. This is opposed to the way that Netflix, Amazon Prime, and other online services stream. When you watch one of those services they send a big burst of data at first and they provide enough download to stay a few minutes ahead of your viewing. As you watch, they stream more and try to stay ahead of you. Since you are watching a cached copy of what you have already downloaded the viewing experience is always a good one.

In these three above examples of live streaming problems the companies blamed the issue on unexpected demand. Certainly there might have been millions watching the Oscars and Game of Thrones, but Sling TV had maybe 100,000 viewers of the final four. And I’ve had problems watching less popular sports events on Sling TV where they probably didn’t have more than few thousand viewers.

I really can’t buy the excuse that the live streams failed because any of these companies had too many viewers. That’s a good excuse to hide behind. But in reality they only send out a small number of live streams to the world – it’s not like they initiate a stream for every viewer who is watching. They instead send a stream to the backbone carrier, such as Cogent or Level3 with whom they are interconnected. A company like HBO might also have direct peering with Comcast and a few other large cable companies and telcos. But most programmers that do live streaming are handing off the live stream to an underlying carrier.

Their problems are going to begin if they hand off everything as routine traffic to an underlying carrier. Unless a content provider requests some sort of priority treatment of their streams then it’s going to be treated like everything else on the web. One would imagine that the stream of a major event is going to end up being sent to nearly every one of the thousands of ISPs in the country. And many of them are far down the Internet food chain and get their bandwidth via numerous hops from one of the main ISP POPs.

There are streaming events that have been successful. Consider the Olympics online. There, NBC transmitted not just one event, but many at the same time, and at least at major ISPs the reports on the quality were very positive. It’s almost certain that NBC paid extra and made arrangements to make sure that the Olympic stream had a high priority through the backbone. In case you are wondering if that is against net neutrality, it is not. Net neutrality looks mostly at the customer side of the network while carriers are allowed to pay for arrangements needed to make their service operate as intended through the backbone.

The reason that you don’t hear ISPs commenting on the issue is that some of the streaming problems come from your local ISP. The issue that most affects streaming video is latency, and ISPs are all over the board when it comes to latency. Latency is the average time it takes a signal to get to you, and ISP networks can have hardware, software, and routing practices in place that result in increased latency to the signal. And as mentioned earlier, one of the biggest sources of latency is the number of hops a signal has to take on the web between its source and a given network/end user.

When I lived in the Virgin Islands the latency was horrendous as we were at the end of the Internet food chain in North America. But a lot of rural places and rural ISPs in the country also suffer from poor latency because they buy their internet from somebody who buys from somebody else and they might be half a dozen carriers deep in the delivery chain.

The final source of a bad viewing experience can come from your home. You may have an old or outdated cable modem, or if you are using WiFi to get internet to your viewing device you might have a lousy WiFi router. So even if a good signal makes it to your house, your own gear might be gumming it up. When Sling TV got a universal thumbs down for doing poorly we know that they had big problems at the originating end, and they probably did not elect to pay for a premium routing of the event. But unfortunately for live streaming companies, there are always going to be customers who have a bad experience for reasons out of the programmers’ control. It might be a long time until the whole Internet is ready for high quality live streaming.

Some Tiny Steps for Web TV

Rabbit_Ears)There were several announcements in the last week from programmers who are going to put their content onto the Internet. I’ve had several people ask me if they think this means that OTT is finally here, and unfortunately I have to say no. But from these time cracks might eventually come bigger fissures. What people are hoping for is the ability to buy only the channels they want without having to buy the big cable bundles. But we still have a long way to go to get to that

The first announcement was from HBO. They plan to roll out an undefined OTT product in 2015. HBO and the other movie channels are unique in the programming world since they are always sold as premium channels and are always expensive. HBO was reported to have over 28 million US subscribers in mid-2013 through terrestrial or satellite TV subscriptions

But HBO also has the most pirated show with Game of Thrones and they have gotten a lot of requests to sell their content on an a la carte basis. HBO has not announced the details of the planned offering, but one can picture it being something like the HBO Go product that comes with most cable subscriptions. It would not be surprising to see their offering consisting of one streaming live channel along with access to the HBO library of content. There has also been no talk of price, but it won’t be cheap. HBO sells its content wholesale to cable companies in the range of $12 per month, so one would expect them to charge an OTT price at least as high as the cable companies, meaning a price of between $15 – $20. Such a product is going to appeal to some cord-cutters and cord-nevers who want to get Game of Thrones and Bill Maher without having to pirate it. But it’s going to be easier and cheaper for most people to buy HBO from their cable company. It’s a smart move by HBO who will probably be able to add a few million new subscribers. But in doing so they are not going to be damaging the traditional cable market

The other announcement this week was from CBS which announced an OTT package for $5.99 per month. This would consist of a live network stream from major market affiliates as well as a library of older content on demand. But for now it won’t include football. This product is a bit more of a puzzle from an OTT perspective. Currently if you buy content from the big cable companies like Comcast you normally get access to the CBS library online to any device. For example, I pay my cable company for a basic package for about $20 that gets me access to the libraries of all four major networks. If ABC, NBC and Fox match the CBS offering, then a person wanting all four networks online would be paying more than they pay for basic cable

The only real advantage of the CBS package is that it comes with a live stream on-line, and this is the first time that a network has offered live content on-line. But one has to ask if that is really worth $6 per month? This is about triple what CBS gets from cable companies that carry their content, so one can see why they want to sell their content for a premium price. But are that many people willing to pony up $6 just to get one channel on the Internet? There will be some but I can’t see this being very popular. After all, in most of the US I can get this on a TV for the cost of a pair of rabbit ears

It’s becoming obvious that any OTT programming that makes it to the web is not going to be cheap. And it’s money that drives the cord cutters. The New York Post reported a week ago that the upcoming Sony OTT package was going to offer 100 channels on the web for $80, while others are reporting a price of between $60 and $65. Those prices are not going to lure many people off cable in metropolitan markets due to the bundling from the big cable companies. Most people are in a position where the cost of their cable internet product rises if they ditch cable TV. In my own case, Comcast would only sell me a 50 Mbps connection if I bought at least basic cable

One has to ask if any of the packages mentioned to date are going to have much appeal. There are going to be the stray customers who will think these products are great. The one with the most chance of success is HBO, because it’s going to appeal to some of those with no cable subscription. But the CBS offer to me is a head scratcher. While there will be some who would love to get network TV on any device, the $6 monthly price tag feels like a lot for one channel. And Sony’s plans are even odder to me. There are certainly people who hate their cable company and would love to change to somebody else. Having 100 channels available on any device sounds attractive (assuming that this won’t only be available on Sony smart TVs). But it’s really hard in metropolitan areas going against the bundle, so it seems that selling packages for about the same price as the cable companies won’t be that attractive. Sony might do better in rural areas for people who want to get off satellite, but those are the areas that often have the worst broadband and where people might not be able to subscribe to OTT programming

None of these announced products are going to make a big crack in the cable market, but these are all the starts to the change. Somebody is going to have to come up with packages that a lot of people are going to find attractive to get any market traction, and that is going to take the willingness of the programmers. They are still making too much from the traditional cable packages to flinch too much. A lot of these early attempts at OTT will probably fail, but that’s what happens to those willing to go first in a new market – a market that consumers want if it can ever be done right.