Citrix, Bytemobile and the trouble with video

Written by on November 26, 2015 in Guest Blog with 0 Comments

Citrix video optimisation

Citrix acquired ByteMobile in 2012 for over $400M. Citrix announced earlier this year that that would be selling the ailing ByteMobile. I guess not having found any buyers, than have now amended prognosis to “pulling the plug”. While Citrix itself is undergoing a wider restructure, the fact that no suitors came forward, is a telling tale.

As Patrick Lopez from Core Analysis points out in his blog here, “the video optimization market has greatly suffered as a standalone value proposition on the combined pressure from the growth of encrypted video traffic and the uncertainty surrounding ByteMobile’s future, the market segment leader in terms of installed base.”

Citrix executives commented…

“The underlying premises for the acquisition of ByteMobile have now vanished. We acquired the company for its ability to optimize video traffic, but today a significant amount of the video traffic is encrypted and can no longer be optimized. […] We will transition some of the capabilities in the NetScaler product but for the most part we are phasing that product line out.”

Combine this incident with the recent announcement by T-Mobile USA regarding free video streaming (Uncarrier X Zero rated video) and the true nature of the problem becomes apparent.

  1. Video optimization was only ever a technical solution to a technical problem. There was never a business case (i.e. money making case) for video optimization. It being a technical solution, it was always susceptible to alternative solutions or other technical advances (like encryption).
  2. No Telecom operator or vendor for that matter has successfully figured out how to make money from video. T-Mobile’s latest Uncarrier move is the closest we have seen in the industry to “monetize video optimization”. While this is a great marketing feat from T-Mobile, the “free video business” can hardly resurrect the video optimization space.

So if music and video streaming is free, what’s next?

This article was first published here, and is reproduced with kind permission.

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Jonathon Gordon

About the Author

About the Author: Jonathon has been lurking around the Telecoms and Internet space for the last 20 years. He is now a man on a mission – that being the reformation of the Industry Analyst business. He is working with his co-conspirators on transforming the Industry Analyst world forever as an Expert with EMI. .

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