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Home arrow Economics arrow Content Delivery Networks. Fundamentals, Design, and Evolution
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OTT Pureplay+Operator CDN

First, for reference, a quick view of OTT Pureplay (here iTunes) on its own is presented in Figure 6.4.

This is probably the simplest diagram to follow. Content is delivered directly to the end user and the return path for content flows in reverse along the same path. There may be some element of monthly subscription too.

Critically the Pureplay operator can only offer an SLA as far as the peering/ transit connection, and relies on the regional Telco and ISP to provide good enough service to the end user to underpin the premium charged.

As Figure 6.5 shows, the key difference between IPTV and OTT is to do with the placement of the paywall. If the paywall is within the last mile operator's network, where the operator might have its own internal CDN (an operator CDN) to manage content delivery across its own “owned” network, then the model is essentially IPTV.

If you simply move the paywall outside of the operator's network, so that the end user has to have a subscription to the operator network for access to the network, and then a payment relationship with the content provider for accessing the content, the model is known as an over-the-top model.

If an OTT provider is large enough, it may use a Pureplay CDN to deliver content to the operator CDN, and the operator CDN may be able to offer a CDN service to the OTT provider under commercial terms. At this point the OTT provider would have contiguous SLA agreements in place from source to delivery of the content. Netflix is a great example of this hybrid model. To form the operator CDN relationship, there may be a revenue stream that the operator CDN receives from each use of the content within the CDN. This

OTT Pureplay (iTunes)

Figure 6.4 OTT Pureplay (iTunes).

OTT and operator CDN models

Figure 6.5 OTT and operator CDN models.

incentivizes the operator to maintain premium service and together Netflix and the operator are well aligned to deliver an excellent premium experience to the end users.

Pure OTT models typically do not provide a commercial incentive to the operator, and accordingly OTT providers may find that they do not have the leverage to ensure a high SLA in the content delivery.

 
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