Netskrt Systems, a Vancouver-based content delivery network (CDN) startup, believes it has the tool set that is needed to provide high-quality streaming video to hard-to-reach rural areas.

The company is touting the ability to more effectively deliver live sports to these regions and fend off subscriber churn in the process. 

When watching fast-paced, competitive content like live sports, Netskrt claims that frequent buffering and inferior video quality cause customers in rural areas to “become frustrated with a poor quality viewing experience."

Churn inevitably follows.

Netskrt says streaming companies can solve the problem by incorporating its “edge-native CDNs” (eCDNS), content delivery networks specifically designed to ensure high-quality viewing experiences for non-metropolitan customers. 

By incorporating an edge-native CDN into their content delivery strategy, streaming services can extend high-quality viewing to subscribers in remote and rural areas, and ensure up to 15% of subscribers who live beyond metropolitan areas won’t have to suffer from buffering or lower-resolution video, the company said.

The startup said eCDNs use a combination of cloud-based content and network management function to ensure outskirt internet-service providers and content providers can verify and validate that all their customers are getting the best possible experience.

“Content providers get an online set of rights to distribute their content online, but the question is, how can they be sure that they're reaching everybody to monetize effectively?” Netskrt Systems VP of product strategy Steve Miller-Jones told Next TV. “With eCDNs, they can verify that they are actually reaching the entire population with a quality that’s acceptable today.”

Netskrt cites S&P Global Market Intelligence’s prediction that sports media rights payments will exceed $25 billion in 2023 as proof of the need to cater to sports viewers.

“Every major company has experienced serious technical issues when streaming live events that attract large viewing audiences watching simultaneously,” Miller-Jones said. “Edge-native CDNs put every subscriber within one hop of an edge cache, minimizing latency, enhancing the delivery speed of video content and improving the metrics that affect quality of experience. 

“When edge-native caching is in place, viewers in last-mile or ‘last-subnet’ locations have an equally high-quality viewing experience as millions of other subscribers in highly populated urban areas,” he added.

In January, Netskrt partnered with global software provider Thales to bring airplane passengers full access to streaming services while in flight through the use of these same edge-native CDNs.

Founded in 2017 by CEO and technological entrepreneur Siegfried Luft, Netskrt has previously employed on-demand streaming on railways in the United Kingdom, continental Europe, North America and other underserved locations.

Luft is also president and owner of Gulf Islands broadband provider Beacon Wireless, which he started in 2010. He also founded cloud computing startup Siaras as well as the telecommunications supplier Zeugma Systems.

Recent updates to the Web site for DirecTV Now show that AT&T’s coming OTT-TV service will support live local streams of ABC and NBC in “select markets” and will initially support a handful of streaming platforms, including the Amazon Fire TV box, fourth-gen Apple TV, Google Cast, as well as Web browsers and Android and iOS smartphones and tablets. 

That update, spotted today by TV Predictions among others, also says DirecTV Now will be “coming soon” to the Google Chromecast streaming adapter and Amazon Fire TV Stick.

Updates:

-The DirecTV Now Web site, as of about 12:30 p.m. ET, appears to be down. 

-As of 1 p.m. ET, the DirecTV Now Web site was back online, though the new material about content and platform support has been removed. At last check, the site has reverted back to an original teaser version that lets prospective customers input their contact information and receive future updates. 

RELATED:DirecTV Now Coming in November

DirecTV Now will start at $35 per month with 100-plus channels and launch sometime next month.

RELATED: DirecTV Now to Cost $35 Per Month

DirecTV Now’s initial lineup has not been announced, but the site does note that live streams from ABC and NBC will be “available in select markets,” that customers will be able to add-on HBO and Cinemax, and that the service will feature more than 10,000 on-demand movies and TV shows. The site did not spell out which markets will get those local live feeds, but it's likely that they will initially include those in the ABC and NBC owned-and-operated markets. 

Per the DirecTV Now site, customers will also be able to try the service for free for seven days.

Viacom, NBCU,  Discovery Communications, Scripps Networks, A+E Networks and Turner are among the programmers that have announced distribution deals for DirecTV Now.

RELATED: Next TV Summit 2016: Goncalves: No Skinny Bundles for DirecTV Now

On the backend, AT&T is reserving enough capacity to support about 1 million simultaneous DirecTV Now customers, according to a report from Dan Rayburn, EVP for StreamingMedia.com and principal analyst at Frost & Sullivan.

RELATED: NBCU’s Burke: ‘Healthy Degree of Skepticism’ That OTT TV Will Draw Subs by the Millions

Rayburn said AT&T will be using “at least three CDN partners” for DirecTV Now, including Akamai, Level 3 Communications and Limelight Networks.

The analyst also estimated that if AT&T did sign up 1 million subs and each sub watched 90 hours of video a month, or about three hours per day, the total volume of traffic per user would be 85 gigabytes, using an average bit rate of 2.1 Mbps.

If that traffic was to be divided by three CDN partners equally, Rayburn further estimated that the value of the contract to each would be about $850,000 per month.

“But AT&T won’t have 1M subscribers from day one and most users probably won’t watch 90 hours a month, or will watch some on mobile, which takes up far fewer bits,” Rayburn wrote. “For the first few quarters the delivery business would only be worth about $250,000 to each CDN per month, as AT&T ramps.” 

In today’s environment of cord-cutters and streaming services, cable MSOs are under pressure to offer competitively priced services while providing an enhanced quality of experience.

The pressure is not unfounded – there is a lot at stake for cable companies facing what can be described as an "over-the-top (OTT) double-edged sword.” Internet service has never been more important to cable companies as they watch linear video give way to on demand programming, but meeting customer demand for fast and reliable internet service is ironically what led to the decline of their video revenue stream as it paved the way for OTT service providers such as Netflix, Hulu and Amazon Prime. 

With OTT not going away, cable companies must look to provide a greater experience in order to stay ahead of what will certainly be the future of television to remain viable. But what steps can MSOs take to provide a greater level of service? 

For one, adoption of virtualization technologies and trends like Head Ends Re-Architected as a Data Center (HERD), which is the adaptation of the telco Central Office Re-Architected as a Data Center (CORD) initiative for the MSO market, will be important. Another differentiator is the continued drive to push the network closer to subscribers with what is described as a Fiber Deep evolution—pushing the fiber closer and closer to the end user to provide better service. 

While cable companies may look different by 2020, whether they begin decoupling programming packages or even aggregating OTT packages as Comcast is planning to do with Netflix, they need to focus on their architecture to support a better experience now and allow them to offer differentiating features in the future. 

Importance of Highly Responsive Internet Services

As user demands around Internet speed and availability have increased, the need to store content locally to provide high quality, responsive access to the content that customers want is required in order to address the competitive landscape.

The Internet relies on locally stored or “cached” content to serve up a great user experience. Cable has an advantage here, since they are the network down the block—not miles away in a large data center. That distance will impact responsiveness and, especially in peak hours, quality of service. The cable headend has for many years served up on demand content, but will need to make one more transformation to bring content even closer to consumers.

The first generation of streaming video might take customers to a data center out-of-state providing poor performance while tarnishing a cable company’s internet services reputation. By leveraging the HERD approach and utilizing data center technologies like virtualization, caching and software defined networking in the headend, those organizations can keep customers satisfied, lower the abandonment rate and make sure the advertisers get compensated.

Competition is already robust and to stay ahead, the customer experience is best served from the headend down the road rather than from a random data center in the cloud.

Content Delivery, Mobile Edge Computing and the Redefined Network Edge

Netflix is a great example of a company that innovated its networks out of necessity. While a fledgling streaming media company a few years ago, the company realized that the legacy Internet was not enough for the new mobile generation. Netflix used the cloud and the internet but found that video would not work unless it was delivered by a local server. When streaming from a far-away data center, the user often became dissatisfied and cancelled their service. Content Delivery Networks solved the problem to a degree, but still lacked the ability to scale with demand and would still limp along slowly.

To overcome this challenge, Netflix reimagined content distribution and placed servers close to the Internet’s edge, providing near real time responsiveness. Now picture making the performance even better by having the network respond with more bandwidth by effectively optimizing caching technology.

By moving and virtualizing these servers and sharing precious network resources, cable MSOs can effectively make all OTT content closer to the end user, improving latency and providing a platform for video aggregation that can support live and real time events such as the Super Bowl or a heavyweight boxing match.

And by driving the fiber deeper, they can further improve performance: deep fiber pushes the optical-to-electrical conversion of signals closer to subscribers, which increases potential bandwidth to homes (allowing for support of newer and more numerous services), as well as cutting down on operational costs related to power and maintenance.

Marrying Transport and Caching

Let’s face it, video follows a hockey stick curve, where there may have been slow growth initially but we have seen that growth rate quickly increase to a much faster rate. With the ability today to interact with content and binge watching becoming the new normal, cable MSOs must be able to quickly react and provide a differentiated user experience for their customers. To achieve this, cable MSOs will need to throw a combination of compression, caching, and CDN technologies at the problem.

But what if there was a new option, with the ability to get a file from just a few miles away—near instantly—and the user wouldn’t realize the difference. The future of the cloud is a combination of network, compute and storage architectures to create the best experience. By offering the right mix of bandwidth and orchestration, cable MSOs will be able to take their businesses to the next level.

This will keep the OTT consumers happy while cable MSOs avoid becoming the weak link in the video delivery value chain.

-Elias Cagiannos is MSO Practice Leader at Ciena