As a follow up on my two previous posts I would like to share this important information: 64% of Mobile Internet traffic will consist of video. This was mentioned in a report produced by the Institute of the Future.

Despite the fact that the report was commissioned by Skype, a major player in the personal video conferencing market, the arguments and numbers presented in the report make perfect sense. What backs this claim is the forcast made by Cisco that video will account for 91% of Internet traffic by the year 2013. No wonder why Cisco recently acquired Tandem for $3 billion.

Because HQ and HD video traffic require a consistent high bandwidth (> 500 kbps), wireless operators will be faced with a dilemma: loose money or sacrifice QoS.

The ONLY way for wireless operators to avoid this dilemma is to increase the cell capacity beyond what is minimally required by 4G standards. The use of MU-MIMO (multi-user MIMO) will be a must. What this means is that operators have to seriously think about installing basestations with high number of antennas. As of today’s date there is no commercial basestation with more than 4 antennas.

This represents a business opportunity for a young wireless start-up. The key to success is to target very high number of antennas so that a sufficient increase in cell capacity is achieved. A BS with 16 antennas will provide a 4x increase in cell capacity compared to the one that has only 2 antennas (i.e. simultaneously serving 8 users versus serving only 2 users, respectively, assuming that each user has two anntenas).