There are 160 million households globally that have high speed Internet but cannot stream high definition video such as Netflix. These people typically live in sub-urban and rural areas and are therefore limited in their entertainment options.
Traditional TV consumption, on the other side, is on the decline. In 2014, there was a 13% drop in viewing hours. 460k cable subscriptions were cancelled last quarter. Cord cutting continues to gain traction and more streaming content is rapidly becoming available. 30 million US broadband households unfortunately cannot be part of this bandwagon. Despite having internet connections, they just can’t stream video at HD quality.
Majority of these US households use satellite internet service, pay for expensive monthly plans and still struggle with watching more than 3 hours of Netflix content every month. A Canadian company called Aterlo Networks is trying to fix that with its flagship offering, NightShift.
NightShift pre-loads video during off-peak hours so content is stored closer to the subscriber. These times often coincide with free zones offered by ISPs, so all of the downloading is done without impacting the subscriber’s datacap. NightShift works automatically in the background, scheduling a recording when a customer starts watching a Netflix show on any device connected to the customer’s home Wi-Fi network. Nightshift further keeps tab of a consumer’s Netflix viewing, and automatically starts to cache content he is interested in during free, off-peak hours.
Existing Content Delivery Networks do not solve this problem as they only optimize delivery of content into the Internet service provider (ISP) networks. This does not help with the last mile which has technology constraints in satellite capacity, slow DSL and Wi-Fi spectrum. At the moment, its one of a kind company in the world dedicated to solving this problem with streaming services like Netflix using the router as a critical component of the relationship which allows buffer-free stream the next day. It’s very different from a web based recording service like play later from PlayOn.
Based out of Waterloo, Ontario, the startup recently raised a $1M fundning round let by MaRs IAF accelerator. BDC Capital and Sandvine also invested in this round.
Aterlo Networks CEO Gerrit Nagelhout and his two co-founders Scott and Dan at Aterlo were all long-time employees of internet traffic management specialist Sandvine, where they learned firsthand about the growing impact Netflix is having on ISPs and their subscribers. So when they left Sandvine in the summer of 2014, they were initially looking to help ISPs to optimize their networks for Netflix. But while doing their research, they stumbled across millions of rural internet subscribers that have no ability to use Netflix at all — and this eureka moment led the company to target these consumers directly.
The company currently works with more than 200 internet services dealers across the US and reaches customers across satellite, cable and DSL services across 30+ states and is growing rapidly on account of huge interest from customers interested in getting the HD experience while saving on their monthly internet bills.
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