A closer partnership between telcos, regulators and content providers is key to successfully meeting rising consumer clamour for internet video on demand (VOD) in the Middle East, new industry analysis suggests.

According to the Value Partners consultancy, the current technical and business models need to be overhauled to ensure quality of service for an increasingly net savvy audience, with improvements of video compression, buffering and use of progressive download technologies crucial in the race to gain loyal customers.

"As more online video services are launched and internet VOD moves to the TV, audiences in the Middle East increasingly expect internet VOD to match the reliability of broadcast TV," said Santino Saguto, Partner, Value Partners.

“VOD is the most technically challenging of all services to deliver with guaranteed quality of service,” he continued.

“Today, to stream standard definition (SD) video without interruptions requires a consistent speed of around 1.5 Mbps for the duration of the video. This is more demanding than other applications such as surfing and email, which are bursty and less time critical; or internet telephony which requires lower bandwidth,” said Mr Saguto.

The consultancy predicts internet users are likely to default to a small number of favourite sites - including YouTube and Seesaw - with picture quality, service reliability and personalisation and preferred user interfaces driving the demand.

With this in mind, Value Partners believes that VOD opportunity in the Middle East is linked to providing local content, regional websites or at least regionalizing existing global websites.

As telcos control the majority of the delivery infrastructure in the Middle East, the consultancy says: “[with] the right investment in network infrastructure use of intelligent network management and traffic prioritisation techniques, and appropriate partnerships across the value chain, they will be able to provide guaranteed QoS solutions to consumers and content providers.

“Furthermore, the nature of telcos' relationships with their customers means they are best placed to work with customers to trouble-shoot any pinch points within the customers.”

Value Partners also highlights the efforts the UAE and Qatar have made to deliver fibre to the home (FTTH) to deliver high speed broadband and improved quality of service to their customers.

‘Major telcos are also seeking to take the market opportunity opened up by guaranteed QoS technologies one step further, by moving into triple-play, offering customers a bundle of pay TV, broadband and telephony. This would help them extend their relationship with customers, grow average revenues per users (ARPUs) and reduce churn,’ concludes the report.