Jan 2

Case Study: How AV1 Encoding Slashed a Client's CDN Bill by 31%

Welcome to a pioneering case study that showcases the transformative journey of one of our early-access clients using our soon-to-be-released video encoding service. This narrative delves into the client's initial challenges in video encoding and streaming, employing the H.264 codec. Despite trials with H.265, VP8, and VP9, cost-effectiveness remained elusive. This story unfolds the transition to our innovative AV1 Video Encoding Service, highlighting the impressive cost savings. We'll also provide an insightful glimpse into the compatibility and user engagement statistics post-implementation, offering a comprehensive view of the impact our services have on modern video streaming solutions. Continue reading to unveil how this client achieved a remarkable 31% CDN cost reduction using our AV1 Video Encoding Service!

Case Study: How AV1 Encoding Slashed a Client's CDN Bill by 31%

Prior to migration

Type Gbps
MPEG-DASH H.264 33
HLS H.264 27
Plain HTTP H.264 7
Total H.264 67
Total 67

After migrating all compatible traffic to AV1

Type Gbps
MPEG-DASH H.264 4
MPEG-DASH AV1 8
HLS H.264 27
Plain HTTP H.264 6
Plain HTTP AV1 0.5
Total H.264 37
Total AV1 8.5
Total 45.5

This migration resulted in a significant saving of 21.5Gbps out of the initial 67Gbps, equating to a 32.1% reduction in CDN bandwidth.

How did we do it?

The client shared a lengthy history of trial and error, investing significant time and resources in experimenting with various codecs such as H.265, VP8, and VP9. Despite exploring different libraries, drivers, tools, and hardware over the years, their consistent conclusion was that encoding and serving H.265, VP8, or VP9 was not economically justified, until the introduction of SlashedCloud AV1 Encoding, and its reduced price.

This experience resonates with many of our clients who have faced similar challenges. The encoding costs always outweighed the potential savings on CDN bandwidth expenses, making it an impractical investment over an extended period.

Generally speaking, only clients with a limited number of videos, but served frequently, find added value in extra encodings, for instance H.265 for Apple devices. However, this scenario is not representative of the broader majority within our client base.

The game-changer in this narrative was the affordability of SlashedCloud's AV1 Encoding Service. Our pricing model made it economically feasible, marking a pivotal shift in the cost-effectiveness of video encoding. We'll explore this aspect more thoroughly later in this post.

We also would like to share that across all the videos encoded for all our current customers, we noticed an average compression of 67% (Yes, 67% savings! A 1000GB file becomes 330GB, with a VMAF score of 95%, visually indistinguishable).

It's imperative to conduct a comprehensive study on compatibility prior to the encoding process and, afterwards, you'll also need to prepare your video player to serve these (encoded) files correctly.

Our customer has kindly shared their conclusions with us and we're passing along these insights to you. The information gathered in this blog post could potentially save you a considerable amount of time in your own endeavours.

  • AV1 is not currently supported on Apple devices, except for the new iPhone 15 Pro and 15 Pro Max models (we anticipate broader support in the future)
  • It's essential to continue serving H.264 (or H.265) to ensure compatibility across various devices.
  • Few web players support segmented AV1. We could only successfully play them using dash.js and shaka player. Their choice was shaka player.
  • MPEG-DASH was their streaming method of choice for adaptive bitrate. MPEG-DASH is codec-agnostic and therefore works with both AV1 and H.264.
  • VideoJS can play single bitrate AV1 plain HTTP streams on supported browsers.

Current Client Approach

iOS

  • For iOS devices (version > 10), serve HLS with H.264 using videoJS.
  • Accounts for 27% of the client's traffic (views/plays) and 59% of the CDN traffic (bandwidth). We hope the compatibility of apple devices and AV1 increases in the future leading to further savings.

Android and Windows PC's

  • For Android and Windows PCs on Chrome (version > 63) and Firefox (version > 67) using shaka player with MPEG-DASH and AV1.
  • This implementation dynamically assesses the browser's capability through API calls such as "MediaSource.isTypeSupported" and "navigator.mediaCapabilities.decodingInfo." In cases where AV1 is unsupported, the player seamlessly shifts to MPEG-DASH with H.264.
  • Accounts for 68% of the client's traffic (views/plays) and 18% of the CDN traffic (bandwidth).
  • Notably, this segment reflects the most substantial savings for our client.

Legacy

  • For any other platforms/browsers, use plain HTTP with H.264
  • Accounts for 5% of the client's traffic (views/plays) and 14% of the CDN traffic (bandwidth).
  • This is needed for compatibility with old devices/browsers.

Why SlashedCloud is the game changer?

Our AV1 encoding pricing is incredibly affordable — around 10x cheaper than the lowest-cost competitor we could find on the market. Find all the details here.

Customer Approach

Here's a breakdown of the customer's calculations.

CDN price:

  • CDN storage price is 0.01€ per GB
  • CDN streaming price is 0.005€ per GB

Video library details:

  • Video library consists of 116571 videos with an average duration of 18 minutes each video
  • Videos are encoded in up to 6 different formats depending on the original video's resolution (4K, 1080p, 720p, 540p, 360p, 270p), average 5 versions

Encoding costs:

  • The total cost of encoding was 302172.1€ (see details table)
  • The user publishes 30 new original videos every day and the cost to encode these is 77€

CDN costs before migration:

  • CDN consumption on the month prior switching to AV1 was 67Gbps, making a total of 22024575 GB transferred which costed 110122.9€
  • H.264 encoded video library was occupying 126976GB - costing 1269.8€ per month

CDN costs after migration:

  • CDN consumption on the month after switching to AV1 was 45.5Gbps, making a total of 14956987.5GB transferred which costed 74784.9€
  • His AV1 encoded video library was occupying around 41984GB - costing around 419.8€ per month

Savings and ROI:

  • The total CDN cost was 111392.7€/month and dropped to 76474.5€/month, meaning 34918.2€ (31.3%) savings per month.
  • The initial investment of 302172.12€ will be recouped in just 9 months, marking a swift return on investment.

This financial outlook underscores the enduring benefits and cost-effectiveness achieved through the adoption of SlashedCloud Services.

Encoding Cost Breakdown

(for the client's initial library)

Source Height Source Multiplier Target Height Target Multiplier Minutes Cost (EUR)
270 0.5 270 0.75 58088 871.32
360 0.5 270 0.75 79476 1192.14
360 0.5 360 0.75 80239 1203.585
540 0.5 270 0.75 477950 7169.25
540 0.5 360 0.75 473475 7102.125
540 0.5 540 0.75 481057 7215.855
720 0.75 270 0.75 525159 11816.0775
720 0.75 360 0.75 526191 11839.2975
720 0.75 540 0.75 526150 11838.375
720 0.75 720 1 526562 15796.86
1080 1 270 0.75 921880 27656.4
1080 1 360 0.75 922334 27670.02
1080 1 540 0.75 922534 27676.02
1080 1 720 1 922238 36889.52
1080 1 1080 1.5 923196 55391.76
1620 1.5 270 0.75 119 5.355
1620 1.5 360 0.75 119 5.355
1620 1.5 540 0.75 119 5.355
1620 1.5 720 1 119 7.14
1620 1.5 1080 1.5 119 10.71
1620 1.5 1620 2 119 14.28
1620 1.5 2160 4 111 26.64
2160 2 270 0.75 72468 4348.08
2160 2 360 0.75 72506 4350.36
2160 2 540 0.75 72522 4351.32
2160 2 720 1 72510 5800.8
2160 2 1080 1.5 72507 8700.84
2160 2 2160 4 72554 23217.28
302172.12

Conclusions

The decision to opt for SlashedCloud's AV1 Encoding Service has proven to be a lucrative investment for this client. The return on investment is projected to be achieved in just 9 months, with subsequent savings thereafter.
In contrast, choosing services from our competitors would extend the payback period to over 7 years.

While it's true that AV1 is not yet universally supported, with most Apple devices and some legacy devices lacking compatibility, its impact on Android and Windows PCs is already substantial. Looking ahead, we anticipate the complete adoption of AV1 by Apple, which already began with the iPhone 15 models, and we're confident on further underscores on the long-term worthiness of AV1 Encoding investments.

If you seek additional details please don't hesitate to reach out to us through our contact form!

Sincerely,
The SlashedCloud Development Team

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