Revealing Trends and Challenges in the Home Network
Written by Steve GorrettaI often observe tech companies operating inside a bubble, making assumptions about what consumers want, the problems they face, and their spending habits. While intuition plays a big role in creating game-changing technology and being first to market, it’s also important to step back and listen to what that market is telling you. Last month we completed a new study focused on the changing broadband landscape and the challenges of managing the increasingly complex home network. This data adds perspective to our product strategy, and provides additional context for service providers that have deployed or are planning to deploy ClearAccess in their network. We’ll publish an in-depth report on our findings as we have in the past, in the meantime I thought I’d share some of the more interesting insights here.
Based on our research*, the typical U.S. broadband subscriber pays around $40 per month for DSL or Cable (less than 9% have fiber to the home). That price will get you speeds around 10Mbps downstream and 500Kbps upstream. This is a little rough because half surveyed admit they don’t even know what their speed is. Interestingly, only a little over half believe they consistently get the speed they have purchased.
So what’s connected inside the typical home network? Behind the WiFi router, which 90% now have in their home, there are usually between one and three connected devices, including WiFi-enabled phones. This number is growing fast--the number of homes with four to six devices will probably be most common a year from now. Across all users, 78% routinely use high-bandwidth applications such as streaming, gaming, and web cameras.
Many U.S. broadband subscribers deal with routine service interruption: 18% say they experience Internet outages at least once a week, 43% at least once a month. The costs are real: 19% have been compensated by their provider, 7% have switched providers and 47% have considered it, all specifically due to outages. Based on focus group feedback, even small improvements to communication and updates on outages would be welcomed.
Experiencing a “slow” connection is common. Thirty eight percent have contacted their ISP due to a slow connection, and 26% actually scheduled a technician visit. Not surprisingly, those numbers increase five percentage points if there are kids under 12 in the home, ten percentage points if there are kids aged 13-18. Basically, the more kids and devices in the home, the more likely you are to call tech support because of a slow Internet connection.
Calling your service provider because of a slow Internet connection doesn’t usually help though, since only 17% of the time it’s identified as a wiring or equipment problem. Most the time problems go away and resurface on their own, or persist with no clear resolution. In some cases it’s a PC problem, or simply too many devices sharing a limited bandwidth resource.
Bandwidth and speed issues lead to a somewhat conflicted relationship between subscriber and service provider. An online speed test meets expectations only 65% of the time, but actually prompts a customer service call only 15% of the time. Though the market appears headed towards a usage-based billing model for monthly Internet, less than 8% of consumers prefer that model, overwhelmingly they prefer flat-fee. Not surprising, since only 30% have a “clear understanding” of what a Gigabyte is, and only 14% have a tool (or at least know they have a tool) to check their consumption, there’s work to be done to educate customers on usage in the way, for example, the utility companies have. On the bright side, if given those tools, a majority said they would find them useful, and some would even consider paying for them.
What all this tells us is that the growth in Internet use and device connectivity is creating demand for tools that end-users themselves can use to resolve problems. This is where research meets product development, and for ClearAccess it’s about tying these concepts to features and applications that both service providers and consumers want. When you see our products in action, you’ll often see us draw a connection between the trends suggested in research like this and the current and future capabilities of our platform. Stay tuned for more on this topic as we continue to study the dynamics of the connected home.
*Independently conducted nationally by a third party research firm, across a variety of demographics, based on topics and questions specified by ClearAccess.
Once again it was a busy year for ClearAccess at the International Consumer Electronics Show in Las Vegas. Each year we take the opportunity to meet with customers and partners, and show off our current products along with some new applications. I also enjoy touring the showroom floor to observe emerging trends as well as the more forward-looking concepts.
This year we were on display with Broadcom showing our home network management, Bandwidth Monitor™ app, and a special video application based on the Broadcom 7425 set-top-box chipset. We also showcased our management capabilities on the new Broadcom 3383 chipset, which is the next generation gateway chipset with Broadcom’s new Full-Band Capture technology.
We also unveiled our mobile app for the Control Panel consumer interface. We plan to launch it in the first half of this year across all of the major mobile platforms, and CES was the first time it was included in our demonstrations. This is a great way to give the end user instant updates on what’s going on in their home network and how to make it all work better.
We had a great response at CES and we appreciate those that stopped by to see our new products in action. If you didn’t make it to CES, drop us a line and we’ll setup a demo!
ClearAccess at CES: New Video Services Management App
Written by Steve Gorretta
As a company, Netflix is a great case study in how to bring a new consumer content platform to market, and the importance of creating partnerships in the retail ecosystem. I certainly see some parallels to the Powered by ClearAccess model and how we deliver new applications through our service provider channel. And for the record I think $16 is still a pretty good deal for basically all-you-can-eat access to movies and shows, but I’m more interested in the bigger picture here.
Back in January I wrote about the over-the-top video market and concluded that it’s a zero-sum game for consumers, and this recent Netflix price increase reflects this fact. Netflix locked in great content licensing deals back when streaming full-length features was something new, there was no competition, and it posed no real threat to DVD or theater revenue. Now, consumers have other options from big names like Amazon, Hulu, and Apple, and Netflix’s licensing terms are set to increase ten-fold according to one analyst I read. Furthermore, service providers are well aware that Netflix uses more bandwidth than any other application on the Internet, and the shift towards usage caps and metered broadband could pose a new kind of threat to any kind of streaming video offering.
Ironically, one key reason for “cord cutters” to drop their cable or satellite provider and go all-Internet streaming is the perceived continued rate increases for the same service bundles, and its that kind of rate increase that Netflix is catching heat for this week. But the reality is that all of the content originates from the same short list of major studios, and while the means of distribution will vary, the cost to license the content eventually evens out. It then comes down to who creates the best user experience, offers pricing flexibility, and can deliver the highest streaming quality, and in those categories right now I think it’s still anybody’s game.
It’s interesting that as the mobile wireless market increases capacity and speed with 4G/LTE, operators are at the same time increasing the use of WiFi offload to control costs. AT&T just inked a deal to provide free WiFi in New York’s city parks, no coincidence given that New York has been a focal point of AT&T’s mobile performance issues.
ClearAccess’ customers are highly focused on enabling these roaming applications, while at the same time improving the WiFi experience in the home. Our WiFi Signal Monitor app has been a big hit, and our ability to manage and restore settings, and report on trends in WiFi use are key differentiators for ClearVision. In Europe, WiFi is often used to provide VoIP service over shared access points, and dense housing materials have necessitated a quicker shift to “dual band” WiFi technologies for delivering over-the-top video. Both trends require coordination and management that ClearAccess can deliver.
In talking to our customers I hear that ClearVision significantly reduces the cost of deploying and supporting WiFi gateways, but with more devices in the home connecting over WiFi there are always news challenges. Our response is to add more WiFi diagnostics and reporting features to our roadmap, and in the coming months we plan to reveal new and innovative approaches to making WiFi easy to configure and support.
Look for us in the CableNET technology showcase at The Cable Show coming up June 14th-16th at McCormick Place in downtown Chicago. We'll be in the front row at pedestal #1 showcasing our ClearVision platform and DOCSIS cable gateway applications. We will be joined by over 40 exhibitors in the CableNET section including a number of Powered By ClearAccess Partners. It's a great opportunity to see a live demonstration of our capabilities, as well as learn about how ClearAccess can be deployed in your network. See you there!
I don’t think it’s an overstatement to say that cloud computing is one of the most hyped subjects in our industry today. Every day brings a continuous stream of announcements and coverage on who’s doing what in the cloud. It’s not a completely new concept, in fact it’s rooted in the days of IBM mainframes, or in the 90s when Sun Microsystems coined the phrase “the network is the computer.” More recently, the term “cloud” has become synonymous with everything from enterprise software-as-a-service (SaaS), to consumer services like online backup and networked DVR. It seems everyone is pushing a cloud strategy for their product, with an obligatory marketing campaigned that relies heavily on bad puns (“it’s about to get cloudy…”). Microsoft’s “to the cloud” ad campaign, and Apple’s recent acquisition of the iCloud.com domain, show that companies are even trying to get consumers interested. This is a stretch to me, since most consumers have no idea what cloud means in this context, and are more likely to associate the term with bad weather and bumpy flights.
Don’t get me wrong, the cloud concept of storing and managing data/content in a centralized manner makes perfect sense…in some cases. A very basic example, network printing, is something that obviously saves money by not having a printer attached to each PC in your home or office. But according to my research, consumers may be hesitant to turn everything over to a network they don’t own. We see this debate coming to the forefront in music apps, where iTunes is being challenged by cloud music offerings from Amazon and Google.
You’ve no doubt seen the ClearAccess approach described as “cloud-based,” which refers to the fact that our ClearVision platform resides in the cloud, and we are centralizing the data and service management, making it easy to remotely access content and provide centralized support. However, we also have a heavy focus on developing intelligence outside the cloud, since we are communicating with increasingly complex devices in the home network. A good example is Parental Controls—in this case the application is defined and configured in the server, and the consumer uses a web portal to specify for example, which websites are allowed or blocked. To make the app work, the policies are then passed down and put into action by that subscriber’s home gateway. So effectively our cloud-based ClearVision server platform is complemented by the more edge-based Powered by ClearAccess device software, and that combination creates the best of both models: a centralized, cost effective network management system that drives intelligence and action through managed consumer devices in the home.
Though right now the trend is to move everything to the cloud, I think we’ll continue to see the fine balancing act as new consumer technologies emerge and the cost of storing and moving data shifts one direction or the other.
This week at ANGA Cable in Cologne, Germany, Founders Joel Pennington and Ken Hood will be hitting the tradeshow floor with live ClearVision demos on iPad2s.
With 395 exhibitors from 31 countries and 15,400 visitors from 73 countries, ANGA Cable is a huge event for ClearAccess. Feel free to email us at
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if you are in Cologne for the show and are interested in seeing how our broadband apps work in action.
We are now in the process of deploying ClearVision 2.4 to both new and existing customers, and are taking care to ensure that upgrades go smoothly. It’s exciting to see the reaction from the market as we show off continuing innovation in our product, and I can’t wait to unveil some great new applications coming down the line in the coming months!
The answer to the first question is likely “no.” Don’t trust AT&T when they say the average customer uses 18GB/month? I did some rough math, and to use 150GB in a month means you would have to download at a rate of about 460Kbit/sec for every second of every day of the month—that’s a lot. A typical Netflix or Movielink download is about 1.7GB to put it into another perspective. So why have these caps? I think it’s to provide a mechanism to enforce abusers, and possibly to pave the way for introducing more meaningful billing tiers later.
For question two, any ISP that introduces a usage cap will provide a site where you can check your usage to date. Whether or not consumers know how to access that site remains to be seen. Again, these caps are so high that most people won’t even notice.
But this information is just the aggregate use for your whole home. In the future if these caps become relevant for the “average” user, we’ll need some way of understanding what bandwidth usage is and how to manage it. We all know how to turn off the lights or the AC to lower our utility cost, so how can we apply that to Internet use? What’s required is a tool that looks at all the devices in the home, shows who is using what, and provides tips on how to optimize it. This kind of application fits right in to the ClearAccess Intelligent Pipe™ strategy, in fact we’ve already market tested a whole-home bandwidth monitor application, and consumers showed a high level of interest in having this information.
I think we’re definitely heading towards more usage-based billing, and for ISPs the key will be to make it easy for their customers to understand what they are paying for. A well-informed and empowered subscriber is more likely to stay with their service provider, a concept that is sure to be tested as the bandwidth cap trend continues.