Broadband Data is the New Oil

We have known for some time how effective internet video can be. Now, CBS is in agreement. Gone are the days where the broadcast giants feared online video, worrying that viewers would dump traditional network TV viewing in favor of the computer screen. Instead, CBS has learned that putting their videos online actually drives television consumption.

In this interview, courtesy of Beet.TV, Jim Lanzone, president of CBS Interactive, says “Internet video is finally working.”

I can’t help but think that internet video is finally working for CBS because of greater broadband availability. Think about it. Did anyone truly enjoy the quality of those early internet videos after waiting an eternity for them to download?  Internet video consumers are an impatient bunch. If we don’t see our video within 5 seconds (or less) of clicking ‘play,’ we’re gone.  Do you really want to see internet video succeed? Get reliable 10 Megabit or higher data service to mobile devices, then you’ll see it take off.

On a related note, Cisco recently released their Visual Networking Index (VNI), an ongoing initiative to track and forecast the impact of video on the internet. Cisco says average broadband speeds, currently around 7 Megabits, will grow to an average of 28 Megabits by 2015. Data traffic in the mobile space will increase 26 times between 2010 and 2015, and what may be more relevant is that mobile data traffic will grow 3 times faster than fixed IP internet traffic in that same period.

Cisco sites four primary elements currently driving IP traffic growth: more devices; more Internet users; faster broadband speeds; and greater video consumption. By the end of the year there will be more networked devices than people on earth and by 2015, there will be twice as many networked devices than the people. Video data traffic, already the largest single component of internet traffic, will account for over 50% of total internet traffic by the end of 2012, and increase to 62% of all traffic by the end of 2015.

So, as video consumption on the internet continues to climb, the picture seems pretty clear to me: A fast and reliable broadband data connection is the new oil. Without it, video cannot grow.


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