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Value Creation in a QoE Environment

Author

Listed:
  • Heger, Tobias
  • Schlesinger, Maximilian D.

Abstract

User behavior of multimedia services currently undergoes strong changes. This is reflected in several recent trends, e.g. the increase of rich media content consumption, preferences for more individual and personalized services and the higher sensitivity of end users for quality issues. These changes will eventually lead to strong changes in network traffic characteristics: rising congestion in peak times and less availability of bandwidth for the individual user. As a result, the quality as perceived by the end-user will decrease if network operators and service providers do not anticipate the required changes for the network. Measurable network requirements such as available video and speech quality, security and reliability are addressed by technologies that are commonly summed up in the Quality of Service (QoS) concept. However, the end-users' perception of quality is only reflected in the wider concept of Quality of Experience (QoE). This takes the measurable network requirements into account as well as customer needs, wants and preferences. For the implementation of QoE technologies several network components need to be added or changed resulting in high capital expenditures. Yet, it is not clear if these costs can be compensated with efficiency increases. Thus, new revenue streams for the network operator are necessary to incentivize investments in QoE technologies. In this paper we address four new value creation models that can serve as basis for more elaborated business models for network operators and other actors. We show how interest in QoE of the user, the content provider, the service provider and the advertiser induces new revenue streams. These models are embedded in five possible future QoE scenarios that reveal regulation, end user quality sensibility and end-to-end support as major issues for the future.

Suggested Citation

  • Heger, Tobias & Schlesinger, Maximilian D., 2010. "Value Creation in a QoE Environment," 21st European Regional ITS Conference, Copenhagen 2010: Telecommunications at new crossroads - Changing value configurations, user roles, and regulation 14, International Telecommunications Society (ITS).
  • Handle: RePEc:zbw:itse10:14
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    References listed on IDEAS

    as
    1. Fijnvandraat, Marieke & Bouwman, Harry, 0. "Flexibility and broadband evolution," Telecommunications Policy, Elsevier, vol. 30(8-9), pages 424-444, September.
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    More about this item

    Keywords

    Business Models; Quality of Experience (QoE); Quality of Service (QoS); Value Creation;
    All these keywords.

    JEL classification:

    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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