NETINT Breaks Into the Streaming Media 100 List 2023

NETINT joins the prestigious Streaming Media 100 List for 2023. Recognized for their pioneering ASIC-based transcoders, celebrated for innovation in live streaming, cloud gaming, and surveillance.

NETINT is proud to be included in the Streaming Media list of the Top 100 Companies in the Streaming Media Universe, which “set themselves apart from the crowd with their innovative approach and their contribution to the expansion and maturation of the streaming media universe.”

The list is compiled by members of Streaming Media Magazine’s inner circle and “foregrounds the industry’s most innovative and influential technology suppliers, service providers, platforms, and media and content companies, as acclaimed by our editorial team. Some are large and established industry standard-bearers, while others are comparably small and relatively new arrivals that are just beginning to make a splash.”

Commenting on the Award, Alex Lui, NETINT CEO said, “Over the last twelve months, video engineers have increasingly recognized the unique value that ASIC-based transcoders deliver to the live streaming, cloud gaming, and surveillance markets, including the lowest cost and power consumption per stream, and the highest density. Our entire company appreciates that insiders at Streaming Media share this assessment.”

“Over the last twelve months, video engineers have increasingly recognized the unique value that ASIC-based transcoders deliver to the live streaming, cloud gaming, and surveillance markets, including the lowest cost and power consumption per stream, and the highest density. Our entire company appreciates that insiders at Streaming Media share this assessment.”

NETINT - Streaming Media 100 in 2023

To learn more about NETINT’s Video Processing Units, access our RESOURCES here or SCHEDULE CONSULTATION with NETINT’s Engineers. 

ON-DEMAND: Building Your Own Live Streaming Cloud

Understanding the Economics of Transcoding

Understanding the Economics of Transcoding

Whether your business model is FAST or subscription-based premium content, your success depends upon your ability to deliver a high-quality viewing experience while relentlessly reducing costs. Transcoding is one of the most expensive production-related costs and the ultimate determinant of video quality, so obviously plays a huge role on both sides of this equation. This article identifies the most relevant metrics for ascertaining the true cost of transcoding and then uses these metrics to compare the relative cost of the available methods for live transcoding.

Economics of Transcoding: Cost Metrics

There are two potential cost categories associated with transcoding: capital costs and operating costs. Capital costs arise when you buy your own transcoding gear, while operating costs apply when you operate this equipment or use a cloud provider. Let’s discuss each in turn.

Economics of Transcoding: CAPEX

The simplest way to compare transcoders is to normalize capital and operating costs using the cost per stream or cost per ladder, which simplifies comparing disparate systems with different costs and throughput. The cost per stream applies to services inputting and delivering a single stream, while the cost per ladder applies to services inputting a single stream and outputting an encoding ladder.

We’ll present real-world comparisons once we introduce the available transcoding options, but for the purposes of this discussion, consider the simple example in Table 1. The top line shows that System B costs twice as much as System A, while line 2 shows that it also offers 250% of the capacity of System A. On a cost-per-stream basis, System B is actually cheaper.

Understanding the Economics of Transcoding - table 1
TABLE 1: A simple cost-per-stream analysis.

The next few lines use this data to compute the number of required systems for each approach and the total CAPEX. Assuming that your service needs 640 simultaneous streams, the total CAPEX for System A dwarfs that of System B. Clearly, just because a particular system costs more than another doesn’t make it the more expensive option.

For the record, the throughput of a particular server is also referred to as density, and it obviously impacts OPEX charges. System B delivers over six times the streams from the same 1RU rack as System A, so is much more dense, which will directly impact both power consumption and storage charges.

Details Matter

Several factors complicate the otherwise simple analysis of cost per stream. First, you should analyze using the output codec or codecs, current and future. Many systems output H.264 quite competently but choke considerably with the much more complex HEVC codec. If AV1 may be in your future plans, you should prioritize a transcoder that outputs AV1 and compare cost per stream against all alternatives.

The second requirement is to use consistent output parameters. Some vendors quote throughput at 30 fps, some at 60 fps. Obviously, you need to use the same value for all transcoding options. As a rough rule of thumb, if a vendor quotes 60 fps, you can double the throughput for 30 fps, so a system that can output 8 1080p60 streams and likely output 16 1080p30 streams. Obviously, you should verify this before buying.

If a vendor quotes in streams and you’re outputting encoding ladders, it’s more complicated. Encoding ladders involve scaling to lower resolutions for the lower-quality rungs. If the transcoder performs scaling on-board, throughput should be greater than systems that scale using the host CPU, and you can deploy a less capable (and less expensive) host system.

The last consideration involves the concept of “operating point,” or the encoding parameters that you would likely use for your production, and the throughput and quality at those parameters. To explain, most transcoders include encoding options that trade off quality vs throughput much like presets do for x264 and x265. Choosing the optimal setting for your transcoding hardware is often a balance of throughput and bandwidth costs. That is, if a particular setting saves 10% bandwidth, it might make economic sense to encode using that setting even if it drops throughput by 10% and raises your capital cost accordingly. So, you’d want to compute your throughput numbers and cost per stream at that operating point.

In addition, many transcoders produce lower throughput when operating in low latency mode. If you’re transcoding for low-latency productions, you should ascertain whether the quoted figures in the spec sheets are for normal or low latency.

For these reasons, completing a thorough comparison requires a two-step analysis. Use spec sheet numbers to identify transcoders that you’d like to consider and acquire them for further testing. Once you have them in your labs you can identify the operating point for all candidates, test at these settings, and compare them accordingly.

Economics of Transcoding: OPEX - Power

Now, let’s look at OPEX, which has two components: power and storage costs. Table 2 continues our example, looking at power consumption.

Unfortunately, ascertaining power consumption may be complicated if you’re buying individual transcoders rather than a complete system. That’s because while transcoding manufacturers often list the power consumption utilized by their devices, you can only run these devices in a complete system. Within the system, power consumption will vary by the number of units configured in the system and the specific functions performed by the transcoder.

Note that the most significant contributor to overall system power consumption is the CPU. Referring back to the previous section, a transcoder that scales onboard will require lower CPU contribution than a system that scales using the host CPU, reducing overall CPU consumption. Along the same lines, a system without a hardware transcoder uses the CPU for all functions, maxing out CPU utilization likely consuming about the same energy as a system loaded with transcoders that collectively might consume 200 watts. 

Again, the only way to achieve a full apples-to-apples comparison is to configure the server as you would for production and measure power consumption directly. Fortunately, as you can see in Table 2, stream throughput is a major determinant of overall power consumption. Even if you assume that systems A and B both consume the same power, System B’s throughput makes it much cheaper to operate over a five year expected life, and much kinder to the environment.

Understanding the Economics of Transcoding - table 2
TABLE 2. Computing the watts per stream of the two systems.

Economics of Transcoding: Storage Costs

Once you purchase the systems, you’ll have to house them. While these costs are easiest to compute if you’re paying for a third-party co-location service, you’ll have to estimate costs even for in-house data centers. Table 3 continues the five year cost estimates for our two systems, and the denser system B proves much cheaper to house as well as power.

Understanding the Economics of Transcoding - table 3
TABLE 3: Computing the storage costs for the two systems.

Economics of Transcoding: Transcoding Options

These are the cost fundamentals, now let’s explore them within the context of different encoding architectures.

There are three general transcoding options: CPU-only, GPU, and ASIC-based. There are also FPGA-based solutions, though these will probably be supplanted by cheaper-to-manufacture ASIC-based devices over time. Briefly,

  • CPU-based transcoding, also called software-based transcoding, relies on the host central processing unit, or CPU, for all transcoding functions.
  • GPU-based transcoding refers to Graphic Processing Units, which are developed primarily for graphics-related functions but may also transcode video. These are added to the server in add-in PCIe cards.
  • ASICs are Application-Specific Integrated Circuits designed specifically for transcoding. These are added to the server as add-in PCIe cards or devices that conform to the U.2 form factor.

Economics of Transcoding: Real-World Comparison

NETINT manufactures ASIC-based transcoders and video processing units. Recently, we published a case study where a customer, Mayflower, rigorously and exhaustively compared these three alternatives, and we’ll share the results here.

By way of background, Mayflower’s use case needed to input 10,000 incoming simultaneous streams and distribute over a million outgoing simultaneous streams worldwide at a latency of one to two seconds. Mayflower hosts a worldwide service available 24/7/365.

Mayflower started with 80-core bare metal servers and tested CPU-based transcoding, then GPU-based transcoding, and then two generations of ASIC-based transcoding. Table 4 shows the net/net of their analysis, with NETINT’s Quadra T2 delivering the lowest cost per stream and the greatest density, which contributed to the lowest co-location and power costs.

RESULTS: COST AND POWER

Understanding the Economics of Transcoding - table 4
TABLE 4. A real-world comparison of the cost per stream and OPEX associated with different transcoding techniques.

As you can see, the T2 delivered an 85% reduction in CAPEX with ~90% reductions in OPEX as compared to CPU-based transcoding. CAPEX savings as compared to the NVIDIA T4 GPU was about 57%, with OPEX savings around ~70%.

Table 5 shows the five-year cost of the Mayflower T-2 based solution using the cost per KWH in Cyprus of $0.335. As you can see, the total is $2,225,241, a number we’ll return to in a moment.

Understanding the Economics of Transcoding - table 5
TABLE 5: Five-year cost of the Mayflower transcoding facility.

Just to close a loop, Tables 1, 2, and 3, compare the cost and performance of a Quadra Video Server equipped with ten Quadra T1U VPUs (Video Processing Units) with CPU-based transcoding on the same server platform. You can read more details on that comparison here.

Table 6 shows the total cost of both solutions. In terms of overall outlay, meeting the transcoding requirements with the Quadra-based System B costs 73% less than the CPU-based system. If that sounds like a significant savings, keep reading. 

TABLE 6: Total cost of the CPU-based System A and Quadra T2-based System B.

Economics of Transcoding: Cloud Comparison

If you’re transcoding in the cloud, all of your costs are OPEX. With AWS, you have two alternatives: producing your streams with Elemental MediaLive or renting EC3 instances and running your own transcoding farm. We considered the MediaLive approach here, and it appears economically unviable for 24/7/365 operation.

Using Mayflower’s numbers, the CPU-only approach required 500 80-core Intel servers running 24/7. The closest CPU in the Amazon ECU pricing calculator was the 64-core c6i.16xlarge, which, under the EC2 Instance Savings plan, with a 3-year commitment and no upfront payment, costs 1,125.84/month.

Understanding the Economics of Transcoding - figure 1
FIGURE 1. The annual cost of the Mayflower system if using AWS.

We used Amazon’s pricing calculator to roll these numbers out to 12 months and 500 simultaneous servers, and you see the annual result in Figure 1. Multiply this by five to get to the five-year cost of $33,775,056, which is 15 times the cost of the Quadra T2 solution, as shown in table 5.

We ran the same calculation on the 13 systems required for the Quadra Video Server analysis shown in Tables 1-3 which was powered by a 32-core AMD CPU. Assuming a c6a.8xlarge CPU with a 3-year commitment and no upfront payment,, this produced an annual charge of $79,042.95, or $395,214.6 for the five-year period, which is about 8 times more costly than the Quadra-based solution.

Understanding the Economics of Transcoding - figure 2
FIGURE 2: The annual cost of an AWS system per the example schema presented in tables 1-3.

Cloud services are an effective means for getting services up and running, but are vastly more expensive than building your own encoding infrastructure. Service providers looking to achieve or enhance profitability and competitiveness should strongly consider building their own transcoding systems. As we’ve shown, building a system based on ASICs will be the least expensive option.

In August, NETINT held a symposium on Building Your Own Live Streaming Cloud. The on-demand version is available for any video engineer seeking guidance on which encoder architecture to acquire, the available software options for transcoding, where to install and run your encoding servers, and progress made on minimizing power consumption and your carbon footprint.

ON-DEMAND: Building Your Own Live Streaming Cloud

Demystifying the live-streaming setup

Demystifying the live-streaming setup w Stef van der Ziel from Jet-Stream (NETINT Symposium on Building Your Own Streaming Cloud) - featured image

Stef van der Ziel, our keynote speaker, has been in the streaming industry since 1994, and as founder of Jet-Stream, oversaw the development of Jet-Stream Cloud, a European-based streaming platform. He discussed the challenges associated with creating your own encoding infrastructure, how to choose the best transcoding technology, and the cost savings available when you build your own platform.

Stef started by recounting the evolution and significance of transcoding in the streaming industry. To help set the stage, he described the streaming process, starting with a feed from a source like a camera. This feed is encoded and then transcoded into various qualities. This is followed by origin creation, packaging, and, finally, delivery via a CDN.

Stef emphasized the distinction between encoding and transcoding, noting that the latter is mission-critical too. If errors occur during transcoding, the entire stream can fail, leading to poor quality or buffering issues for viewers.

He then related that quality and viewer experience are paramount for transcoding services, regardless of whether they are cloud-based or on-premises. However, cost management is equally crucial.

Beyond the direct costs of transcoding, incorrect settings can lead to increased bandwidth and storage costs. Stef noted the often-overlooked human operational costs associated with managing a streaming platform, especially in the realm of transcoding. Expertise is essential, necessitating either an in-house team or hiring external experts.

Stef observed that while traffic prices have decreased significantly over the years, transcoding costs have remained relatively high. However, he noted a current trend of decreasing transcoding costs, which he finds exciting.

Lastly, in line with the theme of sustainable streaming, Stef emphasized the importance of green practices at every step of the streaming process. He mentioned that Jet-Stream has practiced green streaming since 2004 and that the intense computational demands of transcoding and analytics make them resistant to green practices.

Demystifying the live-streaming setup w Stef van der Ziel from Jet-Stream (NETINT Symposium on Building Your Own Streaming Cloud) - slide 2

CHOOSING TRANSCODING OPTIONS

In discussing transcoding options, Stef related that CPU-based encoding can deliver very good quality, but that it’s costly in terms of CPU and energy usage. He noted that the quality of GPU-based encoding was lower than CPU and less cost and power efficient than ASICs.

Demystifying the live-streaming setup w Stef van der Ziel from Jet-Stream (NETINT Symposium on Building Your Own Streaming Cloud) - slide 10
FIGURE 1. Stef found CPU and ASIC-based transcoding quality superior to GPU-based transcoding.

The real game-changer, according to Stef, is ASIC-based encoding. ASICs not only offer superior quality but also minimal latency, a crucial factor for specific low-latency use cases.

Compared to software transcoding, ASICs are also much more power efficient. For instance, while CPU-based transcoding could consume anywhere from 2,800 to 9,000 watts for transcoding 80 OTT channels to HD, ASIC-based hardware transcoding required only 308 watts for the same task. This translates to an energy saving of at least 89%.

Beyond energy efficiency, ASICs also shine in terms of scalability. Stef explained that the power constraints of CPU encoding might limit the capacity of a single rack to 200 full HD channels. In contrast, a rack populated with ASIC-based transcoders could handle up to 2,400 channels concurrently. This capability means increased density, optimized use of rack space, and overall heightened efficiency.

Not surprisingly, given these insights, Stef positioned ASIC-based transcoding as a clear frontrunner over CPU- and GPU-based encoding methods.

OTHER FEATURES TO CONSIDER

Once you’ve chosen your transcoding technology, and implemented basic transcoding functions, you need to consider additional features for your encoding facility. Drawing from his experience with Jet-Stream’s own products and services, Stef identified some to consider.

  • Containerize operation in Kubernetes containers so any crash, however infrequent, is self-contained and easily replaceable, often without viewers’ noticing.
  • Stack multiple machines to build a microcloud and implement automatic scaling and pooling.

Combine multiple technologies like decoding, filtering, origin, and edge serving, into a single server. That way, a single server can provide a complete solution in many different scenarios.

Demystifying the live-streaming setup w Stef van der Ziel from Jet-Stream (NETINT Symposium on Building Your Own Streaming Cloud) - slide 20

BEYOND THE BASICS

Beyond these basics, Stef also explained the need to add a flexible and capable interface to your system and to add new features continually, as Jet-Stream does. For example, you may want to burn in a logo or add multi-language audio to your stream, particularly in Europe. You may want or need to support subtitles and offer speech-to-text transcription.

If you’re supporting multiple channels with varying complexity, you may need different encoding profiles tuned for each content type. Another option might be capped CRF encoding to minimize bandwidth costs, which is now standard on all NETINT VPUs and transcoders. On the distribution side, you may need your system to support multiple CDNs for optimized distribution in different geographic regions and auto-failover.

Finally, as your service grows, you’ll need interfaces for health and performance status. Some of the performance indicators that Jet-Stream systems track include bandwidth per stream, viewers per stream, total bandwidth, and many others.

The key point is that you should start with a complete list of necessary features for your system and estimate the development and implementation costs for each. Knowledge of sophisticated products and services like those offered by Jet-Stream will help you understand what’s essential. But you really need a clear-eyed view of the development cost and time before you undertake creating your own encoding infrastructure.

COST AND ENERGY SAVINGS

Fortunately, it’s clear that building your own system can be a huge cost saver. According to Stef, on AWS, a typical full AC channel would cost roughly 2,400 euros per month. By creating his own encoding infrastructure, Jet-Stream reduced this down to 750 euros per month.

Demystifying the live-streaming setup w Stef van der Ziel from Jet-Stream (NETINT Symposium on Building Your Own Streaming Cloud) - slide 14
FIGURE 2. Running your own system can deliver significant savings over AWS.

Obviously, the savings scale as you grow, so “if you do this times 12 months, times five years, times 80 channels, you’re saving almost 8 million euros.” If you run the same math on energy consumption, you’ll save 22,000 euros on energy costs alone.

By running the transcoding setup on-premises, the cost savings can even be doubled. On-premises is a popular choice to bring more control over core streaming processes back in house.

Overall, Stef’s keynote effectively communicated that while creating your own encoding infrastructure will involve significant planning and development time and cost, the financial reward can be very substantial.

Demystifying the live-streaming setup w Stef van der Ziel from Jet-Stream (NETINT Symposium on Building Your Own Streaming Cloud) - slide 46

ON-DEMAND: Stef van der Ziel - Demystifying the live-streaming setup