Transparent caching plays a very important role in the content delivery market and is a segment of the content delivery industry that is seeing rapid growth ($350M by 2016). To showcase just how much content these caches deliver, industry vendor Blue Coat recently gave me an insight into the data that’s collected by their CachePulse technology.

Blue Coat gets tremendous visibility on the web and how it is changing through its hundreds of collection points and prominent position in some of the world’s largest enterprise and telco networks. In 2013 for example, all the deployed Blue Coat CacheFlow appliances processed over 850 petabytes of data and handled over 13.5 trillion requests. To put this roughly 35 billion requests each day into context, Google in comparison does about six billion searches and Facebook has about 5 billion likes each day.

Digging into Blue Coat’s findings from CachePulse for 2013 there are some expected trends, but also some surprises. To no surprise, video traffic dominated representing more than half (or roughly 55%) of all traffic. And while readers in the US immediately think of Netflix, in reality Netflix is a small player globally. YouTube (including Google Video) remains as the number one traffic driver with DailyMotion a close second. A bit more surprising was the prominent role file sharing and large file updates are playing in shaping traffic patterns. This includes the common Apple iOS and Microsoft Windows updates that regularly clog networks, as well as P2P-based sharing getting replaced with web-based direct download alternatives such as 4Shared, MediaFire and FileFactory.

Driving only a few percentage points of traffic today, gaming has shown big gains increasing 33% over last six months. Sites like Steam, Playstation and Xbox are at the forefront of this shift. Popular downloads like the supersized-18GB Grand Theft Auto V release serve as a great example of the content driving this growth as packaged games shift to 100% digital downloads. And with the recent, frothy acquisition of WhatsApp by Facebook, who can forget about social networks. No surprise Facebook continues to be the leader, followed by Tumblr and Keek respectively. Ranked in the top 30 sites globally, the Russian social network VK (or VKontakte) is also an up and coming player to keep an eye on.

Since Blue Coat has a significant portion of its business deeply entrenched in web security through CachePulse they also gain visibility on security trends on the web at large. In the 2013 findings, Blue Coat found that each day 150,000 GB of the traffic they processed was categorized as ‘suspicious’ while more than 25,000 GB was confirmed as ‘officially’ malware.

So what does this all mean? While the general content mix and the dominance of video is not surprising, smaller shifts around the traffic mix (from P2P to web or with the uptick of gaming), the key players (such as Netflix or VK), or the prominence of suspicious or malicious content is noteworthy. And considering that for 2013 Blue Coat on average saw roughly 80% of this traffic being fully cacheable, there’s a clear role that transparent caching technology – whether with Blue Coat CacheFlow or other solutions – can provide in optimizing this content – whatever it may be – to speed the user experience or provider operational or cost efficiencies, as well as potentially providing an overlay of security and malware protection.

This morning, All Mobile Video announced it has entered into an agreement to purchase live event production specialists AEG Digital Media, based in Los Angeles, CA. The company specializes in live event webcasting, video production and TV Everywhere workflows and was the digital arm of AEG. Terms of the deal were not disclosed, but AEG Digital had a few million dollars in revenue last year, so the deal size isn’t that big. AEG had been shopping their digital group for some time and AEG Digital is a perfect fit for All Mobile Video.

Those outside of the video production and live event industry would not know All Mobile Video, but the NYC based company is one of the best in the market when it comes to providing on-site mobile production and editing trucks, extensive uplink solutions and has Manhattan based sound stages with full post-production capabilities. The company has been around a long time and was one of the first AV companies in the industry to really work closely with webcasters when large scale, live events first started on the web. We worked with them in 2000 or earlier when I was at Globix. All Mobile Video has been helped produce corporate live events for everyone from Apple, GM and Pfizer to major sporting events for ESPN, NFL and the NCAA. AEG Digital’s client roster is just as impressive, with the company having worked on events for Disney, FOX, CBS and Google amongst others.

There are a lot of individuals who produce live events, but when it comes to companies that focus on it as a specialty, it’s really AEG Digital, iStreamPlanet and Origin Digital that lead the market. iStreamPlanet’s business has really taken off as of late and moved them to the front of the pack, but with AEG and All Mobile Video now combining their companies and solution sets, they should also be able to grow their business and capture more of the market for live events services and workflows.

I’m not at the NAB show this year, but I’ve been keeping an eye on all the news and have already seen more than 700 releases from vendors at the show. I’ve sorted through them and pulled out all the ones having to do with the streaming and online video industry and not surprisingly, 4K and video workflow are the hot topics this year, along with transcoding and HEVC.

Here’s the roundup from releases put out over the weekend and on Monday. If I didn’t include your company’s release, send me a link to it in email. Acquisition news is at the top of the list, all the others are listed in no particular order.

• Imagine Communications Acquires Digital Rapids
• Dalet Acquires Amberfin – Purchase Strengthens Dalet’s Leadership In Media Asset Management
• Level 3 Introduces Video Cloud Services
• Cisco and Sony Collaborate on Industry-First Public Demonstration of 4K Live Streaming at NAB 2014
• Harmonic Partners With Encoding.com on Cloud-Based Transcoding Service for Professional Video Applications
• IneoQuest Revolutionizes Video Analytics for Adaptive Streaming Content with the Release of Audience Measurement Platform
• Wowza to Enable High-Quality Live Streaming of DivX HEVC Video Content to Multiple Screens
• MobiTV Selects Elemental for Live and On-Demand Video Processing
• Level 3 Teams With Elemental Technologies To  Conduct First Real-Time 4K Stream of Sony Content in MPEG-DASH Using HEVC Video Codec
• DivX Launches DivX HEVC End-to-End Solution for Creation, Protected Delivery and Multiscreen Playback of Over-the-Top 4K Video at NAB 2014
• At the Forefront of 4K: Intelsat, BT, Ericsson, Newtec and Sony Demonstrate Next Steps to Make True 4K UHDTV a Commercial Reality
• RGB Networks Advances Cloud-Based Ad Insertion and nDVR Solutions at NAB 2014
• Kaltura Releases Smart Video Monetization Suite
• ATEME Unveils Advancements in Support of HEVC Video Compression at NAB 2014
• Dune HD Shows New HEVC-Enabled Set-Top Box At NAB 2014
• NanoTech Adds to its NAB 4K Streaming Interop-Demo List
• AllDigital Integrates DivX Plus Streaming Technology into Leading Cloud Solution for Content Distribution
• MainConcept Expands Support for XAVC Format to Industry-Leading Video Codec SDK
• Aframe Delivers New Products and Cloud-Enabled Broadcast, News & Sports Video Workflows at NAB 2014
• Elemental Announces Full Integration with Virtualized Encoding Solution
• Levels Beyond and Adobe Expand Collaboration to Power End-to-End Management of Digital Content
• Akamai Cloud Workflow Successfully Completes MPAA Security Assessment
• Brightcove Introduces New Monetization Opportunities for Broadcasters through Enhanced Support for Twitter Amplify and Twitter Video Cards
• Cisco Announces Videoscape Virtualized Video Processing – Adds 4K and HEVC Capabilities and Improved Compression
• Azubu Partners with Brightcove to Deliver and Monetize High-quality Video on Any Screen
• Harmonic Redefines Future of Video Production and Delivery with VOS Technology at NAB
• One Device for Everything: WebTuner Delivers Live TV, On Demand and Streaming Video via the Internet
• Advantech Unveils New Platforms for HEVC Processing Leveraging KeyStone™ II Architecture from Texas Instruments
• Verimatrix Shares Insights on UHD Revenue Security Requirements and Considerations at NAB Show 2014
• Digital Rapids Announces New Enhancements and Configurations for Transcode Manager 2 and the Kayak Workflow Platform
• Samsung Adopts Leading DivX HEVC Solution in Wide-Ranging Renewal of Multi-Year Licensing Agreement
• Envivio Debuts Cloud-Based Video Processing Solutions
• Vantrix Open Sources Free HEVC Encoder
• Fraunhofer HHI Presents High-Efficiency, Full HD, Real-Time HEVC Encoding and Decoding at NAB 2014
• OnLive Selects Industry-Leading Interra’s Vega H264 Analyzer
• Hibernia Networks Launches Its Content Delivery Network (CDN) Platform
• Ericsson Simplifies Stream Processing With Powerful New High Density Platform
• InterDigital to Feature Next Generation Video Streaming at NAB Show 2014

If you’re looking for a theme at NAB this year, look no further than media management and the video ecosystem as being the hot topics. Imagine Communications, formerly called Harris Broadcast, announced it has acquired privately held Digital Rapids. Terms of the deal were not disclosed, but I put the price above $100M. Digital Rapids had about $35M in revenue for 2013, so if their projected 2014 revenue was given a valuation of about 3x, which seems to be the average in the space right now, that puts the deal between $100M-$150M in size. Digital Rapids specializes on helping broadcasters with their ingesting, encoding, transcoding and broadcast workflow.

Imagine Communication has confirmed that Digital Rapids President and CEO Brick Eksten along with his management team will be joining Imagine Communications. Specifically, Brick will lead efforts for a significant portion of their next generation cloud-based workflow platform. Digital Rapids has a main location in Toronto, which is less than five miles from Imagine Communications existing Development Center and the majority of Digital Rapids employees will move to the Imagine Communications facility nearby. Imagine Communications said the vast majority of Digital Rapids employees are engineers who will support key R&D developments underway at Imagine, but also included are customer support, key sales, and other employees.

Imagine Communications acquisition of Digital Rapids now gives the company high-end media processing applications that will strengthen their TV Everywhere business, which seems to be getting more traction as of late. Imagine Communications has made a lot of moves over the past few months and is an interesting company to keep an eye on. I suspect the company has one or two smaller acquisitions they are working on to further strengthen their video workflow platform for broadcasters.

As NAB kicks off, we’re seeing a number of exciting deployments of cloud-based digital media solutions. From a trend of conceptual trials and early announcements last year, this indicates a remarkable, and remarkably fast, maturing of the industry. Cloud is solving real pain points for the M&E industry which is still struggling to come to terms with the volume, fragmentation and technological complexity that ubiquitous video gives rise to.

From a research perspective, Frost & Sullivan has released a new study called “Global Media and Entertainment Solutions on the Cloud”. We’ve taken an in depth look at five verticals where the cloud is most impacting M&E applications today – transcoding, media asset management, animation, B2B productivity workflows, and niche services such as captioning and metadata insertion. A brief summary of its findings are available here.

One source of confusion we’ve seen in the market is that cloud is still used as a nebulous term for three distinct use cases – deployments within a private data center (so-called virtualized execution), deployments in a public data center (in other words using Infrastructure as a Service or IaaS) and pay-as-you-go service licenses (in other words Software as a Service or SaaS). The two former use cases are influencing product designs away from dedicated hardware and appliance form factors towards software form factors that are more amenable to virtualization.

The growth in SaaS is more fundamentally transforming the industry by lowering barrier to entry for smaller or less technology-savvy media companies, lowing barrier to entry for any size of media company looking to establish new, experimental or short-term services, and by dramatically reducing total cost of ownership of a wide range of online video services while also providing scalability, flexibility and agility. However, for solutions to optimally deliver on the promise of the cloud, it is critical that they be architected from the ground up for the cloud. On-premise products that are ported naively to the cloud cannot deliver reliability if for example virtual machines need to be rebooted or a network connection goes down. Such products will also be less able to intelligently spin distributed computing resources up and down in response to fluctuating workloads.

While the total revenues accrued under the SaaS model for media and entertainment applications are in the neighborhood of $100 million in 2013, we expect this to rise explosively quickly, approaching the billion dollar mark by 2020, driven not only by a compelling value proposition but also by rapidly maturing solutions and improved market awareness. To more closely gauge how media and entertainment companies are harnessing the cloud today and anticipating using it in the future, we also embarked on a consumer-facing research initiative. Specifically, we spoke with senior executives in marquee programmers and broadcasters, both in the USA and in the UK, to discuss their perceptions of the cloud and its role in their strategic growth initiatives. While there is clear recognition of the value and power that cloud-based solutions bring to a media company’s fingertips, there also remains some hesitation in wholehearted adoption of the cloud that stems from historical perceptions – relating to concerns which we feel are being quickly resolved as technology and commercial offerings evolve.

These findings are published in our new white paper, “Empowering Multiscreen Workflows through the Cloud“, which debunks four key pitfalls media companies often fall into when considering the cloud for deploying online video offerings. The paper also discusses our suggested best practices for success in a cloud-based video ecosystem.  It does so in the context of real world case studies derived from our research.  Further, we examine concrete business benefits that cutting edge cloud-based solutions such as Aventus from iStreamPlanet can bring to a modern media business aspiring to succeed in the new online world order. Aventus powered NBC’s recent online video offerings for the Sochi Winter Olympics in a definitive showcase of the production-grade capabilities of today’s cloud based media workflow solutions. A copy of the white paper can be downloaded from www.istreamplanet.com/nab-2014/frost/.

We’re expecting to see continued innovation in bringing cloud-based workflows to market. Online video is going to continue to grow, as are annual shipments of connected video devices. New devices and services that aim to make it easier for consumers to find and consume online content will continue to emerge at rapid pace – such as Amazon’s recent Fire TV announcement. The cloud will accordingly become more and more critical to helping media companies realize the monetary potential of this ecosystem while remaining competitive and differentiated in a fiercely fought market.

I’ve gotten my hands on a bunch of Amazon Fire TVs and will be giving them away to some lucky readers of my blog. We’ll also be giving them away at the Streaming Media East show in May as well. To win one from my blog, simply add a comment to this post and I’ll pick a winner at random in two weeks. I will only ship these within the U.S. so you must have a U.S. based address if you want to win. Good luck!

If you want to get a jump on your speaker submission for the Streaming Media West show, taking place November 18-19 at the Hyatt Regency Huntington Beach Resort and Spa in California, the call for speakers is now open. The submission deadline is July 30th and the advance program will be published on August 1st.