News Roundup: Announcements From The Mobile Video Industry

There's been a lot of announcements in the mobile video space over the past two weeks, and these are some of the more interesting I've been reading up on:

• Last Friday, news outlets were reporting that Virgin Mobile was closing its U.K. Mobile TV service. This really comes as no surprise considering the service was based on the DMB (Digital Multimedia Broadcast) standard and not the DVB-H standard as well as Virgin Mobile only being able to sell 10,000 handsets capable of getting the content.

• Two weeks ago, The European Union announced that it was backing DVB-H as the mobile TV standard  across Europe. The EU's Commissioner is quoted as saying, "We can either take the lead globally - as we did for mobile telephony based on the GSM standard developed by the European industry - or allow other regions to take the lion's share of the promised mobile TV market. Wait-and-see is not an option. The time has come for Europe's industry and governments to switch on to mobile TV." If only it was that easy in the U.S.

• Last week, the Open Mobile Video Coalition, an association looking to accelerate development of mobile digital broadcast TV in the U.S., announced that it had doubled its membership with the addition of nine new broadcast groups. The group has established a time line that calls for parallel development of standards, devices and business models with the goal of a 2009 launch.

• Transpera, a platform that provides online video publishers with an easy way for consumer to create, share and re-purpose video, confirmed last week that it has raised a first-round of venture capital from First Round Capital, IDG Ventures, and Intel Capital.

• Last week, A&E announced that MobiTV has added two new A&E mobile video channels to its lineup bringing A&E's channel count on MobiTV to nine.

• Telephia Inc., which was acquired by Nielsen last month, released new data last week on the size and adoption of the mobile television and video subscription business. From the release: Mobile television and video subscription revenues grew 198% year-over-year to $146 million in the first quarter of 2007. Approximately 8.4 million wireless customers now subscribe to some form of mobile video, representing nearly 4% of all U.S. mobile subscribers. While those numbers seem high to me, Telephia says that it collects its data from Telephia's panel of 35,000 mobile subscribers.

• ESPN, MediaFLO and Verizon announced they have teamed up to offer live coverage of the X Games 13 event for V CAST Mobile TV. Eight hours of live footage will be provided during the days of the event along with on-demand content. No one has a phone with a battery that will last for 8 hours, so I know they don't expect users to tune into it for the duration, but I'd be interested to hear what the average length of time is spent watching it live.

• Last week, AT&T announced a new service named "Video Share" that allows users to share one-way streaming video. While the announcement seemed to get a lot of coverage in the media many don't highlight the barriers to this AT&T offering. The service only works on their limited 3G network and currently only with four models of Samsung and LG video capable handsets. And there is a monthly video premium consumers need to pay to use this.

• Last week, Harmonic Agreed to Acquire Rhozet, a privately-held company that offers software-based universal transcoding solutions that facilitate the creation of multi-format video for Internet, mobile and broadcast applications for $15.5 million. Harmonic says the acquisition will position them as a leader in Internet and mobile video creation space.

• Based on data released last week, Frost & Sullivan announced that leading U.S. mobile operators have started to embrace mobile advertising and said that mobile advertising is likely to be used to subsidize the cost of content production and lower the cost of service usage. That's a pretty bold statement. To date, online advertising via the PC has not subsidized many content models let along content models for mobile which are still in their infancy.

Internap Is Not The Next Akamai

In an article on Barron's website this week, which Seeking Alpha has an annotated article summary of by Judy Weil, Mark Vererka says that Internap may be the next Akamai. No offense to Internap, but that's an absurd statement for anyone to make. As you'll see below when it comes purely to revenue, numbers don't lie.

It's amazing the amount of analysts who make blanket statements about vendors in our industry, yet then provide no data to back up the predictions and even contradict themselves with the numbers they then use in their articles. For starters, Judy Weil's summary of Mark's article says that "Patent and price battles have seen content-delivery-network giant Akamai and upstart competitor Limelight lose ground." Lose ground to who? How can you make a statement that the number one and number two companies in the space, based on revenue, are losing ground but then don't say who they are losing it to?

The article also says "Internap only recently entered the CDN business with its VitalStream acquisition, and CDN accounts for just 10% of Internap's $192.3 million in revenues." That amounts to roughly $20 million last year for Internap in CDN revenue compared to Akamai's roughly $200 million last year on CDN services and Limelight Networks $60 plus million from CDN services. How do those numbers show Internap becoming the next Akamai? Akamai is doing 10x the CDN revenue Internap is. The fact that the article does not mention that last year, Internap was the number one reseller of CDN services for Akamai also goes to prove that even with the revenue Internap was getting from CDN, it was paying Akamai at the same time. These analysts need to do their homework.

The article does seem to be implying that Internap can become the next Akamai because it says "it (Internap) foresees explosive CDN growth as net users increasingly seek smooth delivery of rich online content." And the other CDN aren't seeing the same growth as well? That's the best reason you have for saying how Internap can grow it's revenue to be that of Akamai? Akamai as a company did over $400 million in revenue last year, Internap did under $200 million. Big difference.

It also goes on to say that "Internap's edge is its proprietary software that has guaranteed 100% reliable internet-routing services and data center hosting (90% of Internap's business), and now guarantees 100% uninterrupted content delivery. The reliability guaranty premium keeps Internap out of CDN price wars while gaining it market share." For starters, that SLA it is referring to is specific to network and data center services, it doe not apply to the CDN services of Internap today. Yes, Internap has confirmed that it intends to offer a 100% SLA specific to CDN services but not until it integrates the VitalStream platform and customers into the Internap network, something Internap is still working on. And even with a 100% SLA, how would that keep Internap or any CDN provider out of price wars? If it is implying that customers will pay more for a 100% SLA, then the article should give details on what is the premium over the going price they are willing to pay. But my guess is that the authors have no idea what CDN pricing even costs in the market.

The article then goes on to compare Akamai's revenue and product line with that of Internap. "Akamai shares fell about 25% last week over forecasts of market-share loss and shrinking orders; Limelight is down about the same this month. Barron's says Internap's Tuesday earnings report will forecast higher growth, lifting its $13.42 shares back towards January's $20 price." Last time I checked, Akamai and Limelight Networks were not in the co-lo and network business and not getting 90% of their revenue from those products, like Internap is. So how can you possibly compare Akamai, Limelight Networks and Internap's overall revenue and stock price fairly? You can't. Their core business and revenue generators are from completely different industries and product lines.

Everyone is entitled to their opinion and who am I to try and tell someone they are wrong. But when you make a blanket statements this article does, back it up with no data, and then don't even look at the data that is out there that proves you wrong, you shouldn't be writing about that segment of any market.

I recently got to sit down with management at Internap and VitalStream to ask about and get an update on their CDN offering and I hope to get to finish my write up of that for my blog this week.

Note: Since I wrote this post on Sunday night, I see that Yahoo! has updated the page I was linking to and now better defines who wrote what. I have edited the text below on Monday morning to reflect the correct authors names. I'd also like to point out that after reading the Baron's article by Mark Vererka, it is my opinion that Judy's summary of Mark's article takes a lot out of context.

Akamai's Stock Tumbles: CDN Industry Still Strong

I've never posted news before about the stock price of any particular company (unless it was a new IPO) simply because to me, the fact that a stock went up or down is not news, it happens everyday. But over the past 24 hours, I have gotten many calls and inquiries from analysts and the media asking me if the fact that Akamai's stock price has gone done nearly $10 a share in the past two days is a sign that the content delivery market for video is slowing down. The simple answer is no.

The fact that Akamai has lost nearly 20% of their market cap in the past two days is reflective of many factors investors attribute to their earnings, growth projections and other factors that I don't even pretend to know all about. While I track the CDN companies very closely, I'm not an analyst in the sense that I don't track companies P&L the way money managers do, nor do I have the interest in doing that.

The fact that so many analysts, media and industry folks are asking about Akamai's stock price and the content delivery industry shows us just how much people don't truly know about what services vendors provide. These days, everyone thinks of Akamai or references Akamai as the streaming company or video delivery company. Yes, they are. But that is just one of many services they provide. While we don't know the exact percentage of revenue that content delivery for audio and video provides to Akamai's total revenue, the consensus in the industry is about 40-45% of their total revenue. That would mean last year they did just under or around $200 million for CDN services for audio and video content. And since Akamai did over $400 million last year as a company in total revenue, the other 50+% of their revenue comes from other non CDN products and services like EdgeSuite, Dynamic Site Accelerator, Web Application Accelerator, Electronic Software Delivery and professional services. But when Akamai's stock drops nearly $10 a share, why is it that no one is asking about those products and services and those industries? Why is it that so many assume that the CDN product line and the video industry is at the root of the problem?

My suggestion, relax. This is not the first time this has happened where a company that provides services in the online video industry has seen a major change in their stock price and it won't be the last time either. The content delivery market is as healthy as ever and the growth of the consumption of online video for longer time, more frequently, at higher bitrates and on multiple devices shows no signs of slowing down.

But I would also suggest that everyone do their homework and become more educated about what services each vendor provides and what percentage of their business is made up from that service. For instance, not a week goes by where someone doesn't compares Akamai's $428.7 million in revenue last year to Limelight Networks $64.3 million in revenue and says Akamai did nearly seven times more revenue than Limelight Networks for content delivery pertaining to audio and video content. That's wrong. They are comparing revenue from products and services Akamai offers against ones that Limelight Networks does not offer. Learn what products and services both companies offer and then compare just those products and services on an apples to apples basis and not the entire company.

It's the same on the network side. People always says Akamai has over 25,000 servers for streaming and video delivery. No they don't. They have over 25,000 servers for all of the types of products and services they offer, but not all 25,000 are setup to deliver every type of content. The servers that deliver Windows Media videos via a streaming protocol are not the same servers that are then delivering a Flash video via streaming. Separate servers are required to deliver content for each streaming platform chosen. What percentage of Akamai's 25,000 servers are setup to support what formats, protocols and geographic locations, they won't say. But if you are going to compare any CDNs infrastructure for streaming to another CDN, then you have to compare the infrastructure that is specific to that type of service. Even if you don't know or the company won't say, you still can get a good estimate if you do some research.

My point is this, if you are going to compare any vendors in the space one to the other, you have to do it in a fair apples to apples comparison as much as possible, which right now, when it comes to streaming and CDN, is not being done by most analysts and investors.

BBC's Internet TV Service Provides Little In The Way Of A TV Experience

The BBC announced today their new free Internet TV service today and are heralding the arrival of their "on-demand" iPlayer as "important as the first color broadcasts in the 1960s." They have got to be kidding.

For starters, the service is only available to users running Windows XP, contains programming from only 65% of the total content on TV and is only available to users living in Britain. The BBC says that it's a priority for them to support other operating systems at some time, including Mac, Linux and Vista, but don't give a time frame as to when. You can't save the content to your computer and can't burn copies of the shows and you can only watch the content for a total of seven days. You can stream content on-demand, you can only download it. The iPlayer, which the BBC has been working on since 2003 and was originally called the iMP (Integrated Media Player) is still in beta mode and to date, I have not seen the BBC talk about what kind of market penetration they think they can get with their player when they do a full launch.

The content won't be HD quality and I can't find any article or info that details what the quality of the video will be. What is the bitrate and resolution? You'd think the BBC would really be focusing on getting this info out there being they are comparing it to a TV experience. But of the 37 news articles in Google News today, not a single one talks to the quality of the BBC service. The BBC is not the first broadcaster to offer this service in Britain. Channel 4’s ‘On Demand’ video download service has been out  for close to a year already.

Also, you can sign up to use the service, but the BBC is limiting the number of people initially who use as so as not to swamp the service and keep it to a controlled beta. I don't think there is anything wrong with  doing it that way, but then why promote it and talk about it so heavily when a large percentage of the people who sign up you will be turning away? Sets bad customer expectations.

The BBC has a long way to go before this becomes a real service and by continuing to talk about how important this is and comparing it to the color TV considering the service is only in beta, has not been tested for scalability, can't support multiple platforms, and can only do downloads, they are setting themselves up for failure in the eyes of customers. You can't promise the world, call it the start of a new revolution for TV and then not deliver an experience that is not even close to the one you say you are going to replace.

Bloggers Need To Cover More Than Just YouTube And UGC Companies

With all that is going on in the online video world today, why is it that most of the blogs and news sites only seem to focus on YouTube or user generated content topics? This week is typical of most. Over the past four days, I have read about 450 posts from 54 sites that I have in my RSS reader. Of those 450, nearly 60% of them are about YouTube, user generated content, video and social networking sites and topics all pertaining to user generated content in some form.

What about all of the other exciting subjects pertaining to the online video world? Why aren't more bloggers talking about video in other markets like the enterprise, broadcast, mobile and education markets? Or what about the infrastructure side of the business. Servers, encoders, formats and tools. Yes, some cover these subjects but literally just a handful. If user generated content sites did not exist, I really wonder if a lot of these bloggers and news sites would have anything to talk about?

Am I the only one who is tired of reading a few dozen stories a day about YouTube and other UGC sites that to date, have shown no successful business models? Yes, I understand the role UGC will play in our industry and I understand the excitement around these tools that enable anyone to get video online. But our industry has been around for the past 14 years now and user generated sites have been around for only a few. There was an entire industry and business before the UGC sites were even around, but you wouldn't know of it the way many of these sites only talk about YouTube.

Microsoft's Internet TV Strategy

Last100.com has a detailed two-part story that outlines Microsoft's current and future strategy for Internet TV posted by Mack Male who also runs the WindowsMediaBlog.com site. It's a good read that gives insight into Microsoft's history in the space and covers many of the products and platforms that have had over the years including WebTV, UltimateTV, Windows Media Center, Microsoft TV Foundation Edition, MSN TV2, Xbox Live Video Marketplace and Microsoft Mediaroom.

Speaking of Internet TV, I'd be interested to hear readers feedback on whether or not the phrases Internet TV and IPTV are interchangeable in your eyes and mean the same thing?

MSNBC.com Needs To Dump MSN's Lousy Video Platform

I first wrote about this back in March and I am amazed that even since then, MSNBC.com still can't get it's live video streaming to work for anyone with a Firefox or Safari browser. And the worst part, they have no problem delivering you a 15 second ad in the player first, BEFORE they tell you that your browser does not currently support live video. So I have to sit through a video ad only to then be told that I can't see the live stream I clicked on.

MSNBC's video player has said it is in "beta" ever since it launched, which was at least a year ago. And it's still in beta? The technology behind MSNBC.com's video offering is "powered by MSN" which in my eyes is even worse. If MSN can't provide the video functionality MSNBC.com should have, then MSNBC.com should fire MSN and use a platform that actually works. But of course that won't happen.

MSN is completely clueless when it comes to its video offering if they think users are going to stay loyal to MSNBC.com as their news source when every other news site does it better. If MSNBC.com was smart, they would dump MSN video immediately and or fire whoever manages their video offering. But they won't do that as Microsoft wants to push their IE browser on you, except that they don't make IE for the Mac, so Mac users are basically just screwed as well as PC users who don't want to use IE and prefer to use Firefox instead.

Last time I posted about this, some readers wrote in to say:

- "It's not just Mac users. I have a PC as well, and many of MSNBC's videos won't play on it either if I'm using Firefox. If I use IE, then I'm okay."

- "I've also enjoyed using Firefox on my laptop, but i can NEVER get MSNBC video to work with Firefox on my laptop - it is so frustrating!"

- "Come on MSNBC, get your stuff together. If amateur webmasters can make this stuff work, so can you. You just don't want to."

2007 marks the 14th year that streaming media technology was first used on the Internet and it's sites like MSNBC.com that make the technology look like it has barely evolved in that time and gives the entire industry and technology a black eye. As much as MSN says video is an important part of their business, clearly their lack of interest in making their videos work properly says otherwise. It's as simply as being greedy and wanting to push IE on us, including those platforms they don't even make IE for.

Microsoft as a company has been late to the game when it comes to all aspects of the Internet and video is no different. MSN, MSNBC.com, Soapbox etc... are all behind the times when it comes to their video offering. You'd think they would want to prove the opposite by having a quality video offering but they are stuck in the politics and red tape of a company that can't get out of it's own way.

My suggestion to MSN, get out of the video business. You have no concept of what a good user experience is, you can't provide basic functionality that ever other major news outlet has been providing for years and you're insulting users by making them sit through ads when they can't get to the content they want. You can't even provide a basic player check to see if the user has the system requirements that are needed - which companies were doing back in 1998.

Give up MSN. Throw up your hands and move on. You can't win in the video game.

Yahoo! Video Shows Us The Problems With Online Video Advertising Today

You'd think by now content companies, especially the large portals, would have figured out a better way to deliver online video ads in a compelling manner. But if Yahoo! News is any indication, the world of online video advertising has a long way to go before this business grows like we all want it to. Delivering online video ads is still a terrible user experience with un-targeted ads, of different lengths, too often in the content whilst taking away all of the user control.

If you want to see clips from the show 60 Minutes, Yahoo!, through a deal with CBS, has created a portal at http://60minutes.yahoo.com. While the interface of watching and finding videos is decent, the entire business and delivery of online video ads is horrible.

I chose to watch the story about online gaming and a window popped up with the video and nine thumbnail videos below the main window. Before the start of the video, I was delivered a 30 second ad for Netflix. While the ad was playing, nothing on the website was clickable, forcing me not to be able to click on any other links and disabling all content on the site. And once the ad was over, the video that played was only about a minute in length. What Yahoo! has apparently done is taken the 60 Minutes segment on online gaming, and cut it up to nine one minute segments. So when a user clicks one of the other thumbnails to watch the second section of the video, they get another ad, again for Netflix, again 30 seconds in length before you get to watch a video that's 48 seconds long.

And if you want to watch all nine segments of the show, get ready to also sit through nine ads. Adding this up, I have to watch nearly four minutes of ads, to see a segment of content less than nine minutes in length. And the ads are completely un-targeted. I got 6 Netflix ads, and 3 ads for online trading. So why is there no ad system in place showing me different ads? Does Yahoo! really think showing me the same ad six times is what consumers want or is effective for the advertiser? And why were some of the ads 15 seconds in length and others were 30 seconds? In the same piece of content you're delivering two completely different ad lengths which is a horrible user experience. I get a fifteen second ad which I then get use to with this content, only then to be delivered one twice as long when I watch part two of the same piece of content.

And even if you let all nine of the videos play back to back playlist style, Yahoo! still puts many ads before each of the segments breaking up all of the content into way too many pieces. If a segment like 60 Minutes is under nine minutes in length, it should not be broken up into nine pieces. And why is it that the 60 Minutes episode that is on the Yahoo! portals home page, is one from close to a year ago and not from the episode that aired last night on TV? The story of online gaming was one I saw on TV at least six months ago. But the one I saw last night on TV is no where to be found on the Yahoo! website.

To find it, I have to go to a different website. And not the CBS Innertube website where you would think it would be since that is where you can watch full-length CBS shows, but rather you have to go directly to the 60 Minutes website on CBS.com. And once there, while I can find the video, see the screen shot on how it plays. It is embedded into the page, in a window that is larger than it actually plays in. But I guess I can't complain since while the video window is super small in size, it is free of ads.

For all the talk of how big the online video industry is, it's not even going to be a billion dollar industry this year, compared to TV advertising which is expected to do over $22 billion this year. While many times different segments of the online video industry say that the business models are what's stopping the growth of an industry and not the technology, when it comes to online video advertising it's the opposite. Online video advertising technology still does not provide the level of functionality, standards, reporting, targeting and interactivity that is needed to drive this business forward a lot faster. The technology needs to get fixed before this business can really start to take off.

Google And I Agree On One Thing: TV Is Not Dead

It's good to see that I am not the only one who thinks people are crazy when they say that TV is dead. TV is not dead. People kept telling me they don't watch TV anymore and only use their computer for video. What are they watching? Nearly every single show I watch is not available on the Internet today, in any form. TV is the only place I can see it. Yes, other means of distribution are going to affect the TV platform, but people are not abandoning the TV in favor of video online like people make it sound.

And to date, those creating content for the web are not creating the type of content that I personally want to watch. And even if they were, can I get it in HD? No. Can I watch it on a large screen? No. Can I easily watch it on my computer with someone else? No. When I travel and am in a hotel, is there a computer there? No. Can I TiVo it? No. Can the Internet scale like TV? No. The TV and the PC (or Mac in my case) are not the same platforms, showcasing the same content, or providing the same kind of experience.

An article in Business Week recently said, "when the line between the TV and Internet will blur..." and it's a comment you hear all the time. The line will never blur between them. They offer different experiences, on different devices, one via a closed network, one open. Yes, they will have some cross over, but they will never "blur". No one will even confuse their PC for their TV or vise versa.

And it's good to see that Google agrees. Vincent Dureau, head of TV technology for Google in a keynote address at the Internet Television Technology Conference this week said that, "on the surface it looks like TV is dead, but I believe there is actually a bright future for television." EETimes.com has details of the  keynote here. Some of their coverage said: Every minute six hours of video is uploaded to Google's YouTube service. What's more, "every day 95 percent of the YouTube library is watched at least once," Dureau said. That implies there is a broad, but fragmented audience for a wide variety of content. "You need to make the long tail of this content available, and the tail is very long," he said.

But I do disagree with Dureau when he says that the biggest problem right now is that users can't find the content they want to watch on the Internet and it's no surprise he says that search is the way to solve this problem. For me, it's not trying to find the content online that's the problem. The problem is that the content does not exist online. And telling me that there might be other content that is "similar" to the content I am looking for is not an answer.

If I like to watch MacGyver, which I do, then I want to see MacGyver shows online and not something that someone created that may be similar to it. I want to see that specific show. So search is not going to help me there. The Internet is not yet ready for TV as we know it and in my eyes, there is no such thing as "Internet TV" even though it is a phrase widely used in the industry.

Broadband Penetration Is Not What's Driving Online Video

So many press releases and reports I read still talk to broadband adoption as if we are still in the year 2000. They say things like "due to the growth of broadband", "because of the proliferation of broadband subscribers" and "the widespread penetration of broadband" etc... broadband access is not the reason online video usage is growing.

At least 55% of all connected households in the U.S. are already accessing the Internet via a broadband connection (some reports say as high as 63%) and the majority of all users who are on a computer at work are on broadband. Yes, the downstream speed of broadband is growing but anyone who is on a DSL line gets at least 1.5Mbps which is plenty fast enough to get a 300Kbps stream, which is considered broadband today. And it should also be noted that two years ago, the standard rate at which "broadband" video was encoded, is the same it is today. So for all the hype around broadband, two or three years later, we're still encoding and consuming the majority of our online video content at the same speed. So the growth of broadband has done nothing so far to change that.

When you talk to a company about it's services or products in the space it's amazing how many of them always throw in the broadband growth sentence as if they have to mention it, as if that validates something or makes them look like they "get it". And most times, if you then ask them for market data on how broadband is growing, at what speeds and in what regions, they have no idea. It's like somebody in their marketing dept preps them and says "make sure to mention about how broadband is growing." I see it all the time on CNN as well when they interview someone on the stock exchange floor. The person being interviewed always make a reference to some aspect of broadband if they are from a tech company.

Yes, broadband plays a role in the consumption of video, but we've had over 100 million households with broadband access for almost the past 4 years now. We should be talking about the real factors that are driving the growth of online video and more importantly the factors that are limiting the usage and growth.

"What's Next for Online Video Advertising" Meetup Video Now Online

The session I moderated last week at the NY Video 2.0 Meetup entitled "What's Next for Online Video Advertising" has now been archived thanks to Viddler. We had a good session with a lot of questions from the audience for the panel of speakers from NBC, DoubleClick, ScanScout and OMD.

The NY Video 2.0 Meetup is a free event organized each month by Yaron Samid over at Pando Networks. Each month the event draws 150-200 attendees and focuses on a particular topic in the industry. If you are in the NYC area this is a great event to attend for lively Q&A and networking.

Looking For Bloggers Who Cover Online Video To Moderate Conference Panels

If you are a blogger that covers the online video industry or any facet of it including infrastructure, advertising, content, etc.... I am looking for a few more moderators for the Streaming Media West show taking place in San Jose from Nov. 6-8th.

I have some sessions already planned out that you can jump on or you can write your own session topic and description that you want to organize a panel around. I am specifically looking for bloggers/writers who cover the industry and have insight into the business and technology trends taking place.

If interested, please e-mail me or call me at 917-523-4562. Note: I already have a lot of bloggers on board so only a few spots are left. Contact me ASAP if you are interested.

Updated List Of Content Delivery Providers For Streaming Video Delivery

Since my post three months ago entitled "Comprehensive List Of Stream Hosting Providers" much has changed in the content delivery market. That being the case, here is an updated list of content delivery networks who support streaming media delivery. Notice I didn't say "video delivery" but rather "streaming" since many companies can deliver video via progressive download off of web servers but don't support streaming via media servers. I also classify a content delivery network as one that providers deliver services from more than just a few locations and has its servers located in at least the North America and European regions.

Now that being said, this list does not take into account P2P providers or networks that are more of a hybrid or the ones that classify themselves as non-traditional CDNs or are P2P based. That list can be seen here and will be updated shortly as well.

Here are the networks I track, in alphabetical order.

• Akamai
• CacheLogic
• CDNetworks
• Ignite Technologies
• Internap
• Level 3
• Limelight Networks
• Mirror Image
• NaviSite
• VeriSign

What's interesting to note about these ten providers is that only Akamai and Limelight have streaming media servers deployed in the Asia Pacific Region. Many of the other providers are working to build out that capacity for the near term, but don't have it today. CDNetworks is the one exception in that they are based in Korea, but have since entered the U.S. market with a streaming media offering serving content of out nine locations in North America. I will have a more in-depth profile of CDNetworks next week.

Level 3 Making It's Move: Acquires European Based Servecast To Accelerate Online Video Offering

Level 3 announced this afternoon that it had acquired Dublin based Servecast, a provider of live and on-demand video management and streaming services for broadband and mobile platforms. Level 3 paid approximately $45 million in cash for the company which did about $5 million in revenue for 2006. Servecast his a nice suite of content management tools for the enterprise and the media and entertainment verticals and has a good reputation in the European market.

No surprise here. As I wrote about a few months ago, Level 3 is looking to be a serious player in the content delivery market for audio and video. While some doubt whether or not a networking and carrier company can really thrive against the larger CDNs, I think they can and will. They have all the pieces to be able to provide a value service offering based on the entire eco-system for content as opposed to just pushing bits.

When Level 3 launches with their streaming media based service in Q4 of this year, I expect they will become a serious competitor right out of the gate. There is no sign of the CDN market slowing down and with the arrival of new companies in the U.S. like CDNetworks and the P2P and next generation delivery networks gaining some traction, the fight for the content delivery market is really about to get serious.

Beet.tv has an interview with Level 3's Lisa Guillaume from the Streaming Media East show in May.

Note: I will be profiling CDNetworks, Internap and Move Networks in the coming weeks.

Flash Based Bubble Guru Product Makes Adding Video To Websites Easy

If you are looking to put video on your website and have content that will work in a small window, like a talking head, you should check out Bubble Guru. This neat little application, based on the Flash plugin, allows you to record video, set options, add tags and then put the video on your website or blog all without having to be a programmer. The coolest function of the video is that it's in a bubble that hovers on your site and moves with you as you scroll down the page. It's hard to explain but you can see a demo right on the home page of their website.

The product really stresses how easy the overall process is in getting personalized video messages on a site and is really going after the non-technical folks. It is ideal for those who would like to quickly place video messages on their site to engage their visitors, but either don't have the technical knowledge to accomplish this in some other method, and/or don't want to have to redesign their web page to make room for videos on their page.

I haven't had time to do a full review of the product yet, but from what I have seen so far, it is clearly a neat and affordable tool for the marketers, public relations professionals and small and medium sized business owners. If anyone reviews the product in detail, please feel free to leave some comments here on what you think of it.

Sawmill Releases Product For Analyzing Flash and Windows Media Formats

Sawmill, a software package that allows for the analytics of raw log files from streaming media services, announced that hey have upgraded their product to support the Adobe Flash media and Microsoft streaming media log file formats.

I've long been one to complain about the lack of tools on the market for those who serve their own streaming media content. (See, "Reporting Tools Lacking For Companies That Delivery Videos Online") Ever since Lariat got acquired and EnScaler went out of business over five years ago, there hasn't been a product on the market that has gotten any real traction. That may change with Sawmill.

StreamingMedia.com did a review of the Sawmill product last month and you can read the review by Steve Mack for more details into the products features and cost. Based on Steve's positive review, it looks like Sawmill may have a chance at really fulfilling a huge need in the market.

The biggest hurdle for Sawmill is that not many know of the company or the product. and the company is based in the UK. You can buy the product from them directly via their website but they really need to start marketing the product here in the U.S. since 9 times out of 10, when I asked people about reporting tools, they have never heard of Sawmill. If the product works as well as Steve's review says, I'm rooting for them.

Lack Of Online Video Data and ROI By Companies Is Hurting The Industry

Reading this months Fast Company, which has an excellent article about bottled water and how American's spend more money on bottled water than they do on iPods or movie tickets, there were some great examples of how in other industries, companies seem to be willing to say what something costs to buy or what the ROI is or potentially could be. I see a lot of this in many other industries from many companies willing to give details, but we see it from very few companies in the online video industry.

For example one of the stories in the magazine was about a band who's song was used in an video game by Electronic Arts. It gave exact numbers on how many games were sold and exactly how much money the band made. In another article, a woman who runs the lifestyle marketing for Toyota's Scion brand was explaining how much money they spend on marketing their product around musicians and she was up-front when asked how that leads to financial success for Scion. She replied, "The honest answer is we don't know. Anyone who says it can be measured is flat-our lying".

My point is this. Why is it that so few people and companies are willing to talk about success or failure, with data and numbers in nearly all facets of the online video industry? Asking any major website what online video advertising CPMs are and you won't get an answer. And if you do it will be such a range that it us completely useless. Ask many content delivery networks what the average price is they charge per GB and typically you won't get an answer. Ask any of the major networks how successful their online video initiatives are and you'll be told they are successful, but no metrics will be given to validate that. Total eyeballs or streams delivered is typically the only number you hear and large traffic does not mean something was successful or profitable. Ask what is costs to sponsor online video content and you won't get any details when it comes to numbers. Ask many content companies what their cost is to produce a program and how much it then costs them to distribute it online and numbers won't be discussed. And of course, revenue numbers are near impossible to get from anyone.

The real question ask is why doesn't one of these companies just share numbers on one project, or one online video campaign or some facet of their business so they can show a real ROI? Show something, set an example and give others something to strive to want to emulate to make this industry into a truly new business.

It's a shame. At some point, you would think some of these companies would want to stand up, give out the details, set the example and be seen as the leaders in any facet of this industry. Setting the example and being a leader would help others strive to follow your lead and push this industry forward. Without that, all this mention about "success" is just a bunch of marketing talk. Think of the publicity that any company would get if they backed up their words with data. They would become the example for others to follow, they would get tons of exposure for showing a successful venture and it would help to kick-start some real data sharing. I don't care if these big content companies and websites are only making $1 after all is said and done, that's a profit and others can learn from it. Everyone is too cautious with data, no one wants to stand up and take charge and in the online video advertising world in particular, no one is sharing any data on CPM pricing, sponsorships rates, viewership data etc... the only data that is shared is generic or high-level with no details.

When I ask for data for an article or blog post, it's funny how many times, the company will say, "who else are you speaking to about this article? did they give you any data?" And when I say no, then they don't either. Snooze. What a missed opportunity to have not followed what everyone else is doing but rather lead the pack by example.

I know, many will say I am asking the impossible or talking about something that is unrealistic. But that's not the case. It is all about thinking outside of the box, trying to foster change and drive this industry forward faster.

OMMA Video Archive With FOX, AOL, Yahoo! and ABC Now Online

Mediapost has now archived the sessions and presentations from the OMMA Video show in NYC. The session I moderated entitled "TV Content Comes Online: Prime Time on the Web" with FOX, AOL, Yahoo! and ABC is now available for viewing.

I asked the panelists some of the questions that readers of my blog wanted to know more about so check out the Q&A portion of the video about 15 minutes in.

You can also read David Kaplan's recap of my session over at PaidContent.org or another overview at Mediapost.com.

MSN Releases Traffic Numbers For LiveEarth Webcast, Sort Of

On Sunday, MSN put out a press release talking about the traffic to the Live Earth webcast. But as I mentioned in my previous post, the way the numbers are given out after webcasts, they don't really accurately measure  the traffic.

The title of the release says "Live Earth Global Concerts Reach More Than 10 Million Online At MSN..." More than 10 million what, people? Apparently not. Because the details of the release then say "MSN had received a total of more than 10 million video streams." So it's not 10 million people as viewers are making more than one request or visiting the site multiple times. So how many unique people was it? And why does it says MSN "received" the streams? MSN does not receive the streams, the receive the request for the stream.

They then say, "...and has the most simultaneous viewers of any online concert ever" but then the release does not give out any details on how many simultaneous streams they did. Why is it so hard for companies to keep from being so vague?

• how many total stream requests did you full fill?
• how many unique streams did you serve?
• what was the average length of time someone watched the webcast?
• what percentage of traffic came from what regions of the world?
• what was the average bitrate that someone watched?

Very easy questions. Basic. These are the same questions that all customers ask their stream hosting provider after an event and gets exact figures.

TV Commercials Showcasing Terrible User Generated Content

User generated content is now everywhere and it seems companies are using it more and more in TV commercials just to look cool or to highlight the fact that it's UGC content as if that makes them hip. In just one night of watching TV, I saw commercials by McDonald's, Geico and some mattress company all using UGC content or filming the video in such a way to look like user generated content. And we all saw what Doritos did with UGC content during the Super Bowl half a year ago. A commercial that would have never gotten any publicity if Doritos didn't highlight the fact it was user generated.

The McDonald's commercial in particular highlights on the screen the fact that the video was "actual user generated content" featuring two kids rapping about McNuggets outside of a store. It's the most annoying commercial ever and companies need to remember that a commercial is about the quality of the content. That's rule number one. Just because the content you use might be user generated, it does not make it quality content. I'm sure someone will say that McDonald's did a good job marketing wise as I now have remembered their UGC commercial and their brand. Yes, I remember it alright. I remember that when I see it, I change the channel.

Reminder: NY Video 2.0 Meetup in NYC Tonight

Tonight, the NY Video 2.0 Meetup will take place at the Columbia Business School. I'll be moderating a panel entitled "Beyond Pre-Roll: What's Next for Online Video Advertising?" starting at 7pm. The panelists for this discussion will be:

• Kevin McGurn, VP, Advertising, nbbc
• Jeff Minsky, Director of Digital Media, OMD
• Robert Victor, Product Manager, Emerging Media, DoubleClick
• Jed Savage, EVP, Strategy and Development, ScanScout

For those attending, I will be asking direct questions. I want to know what video CPMs are today, how much companies are spending on campaigns and what the real dollars look like in terms of where this business is today. Please bring any and all questions you have if attending.

The event is free but the room size is limited to 200 attendees, so check the RSVP page to see if there is room if you want to attend.

I am being told this event will be archived in video for viewing after the fact.

Webcasting Large Entertainment Events Still Unprofitable

I love webcasting more than any other facet of this industry as it's how I got my start fourteen year's ago and it's what I use to do for a living. But it's sad to see that so many year's later, there is still no successful business model in place for large-scale entertainment based webcasts.

In the year's between 1997-2001, there was at least a couple of large music and entertainment webcasts each night on sites like SonicNet, Rocktropolis, MTV, Pepsi.com and many others. Back then, no website was making any money from the traffic or from the content, but they didn't need to. In those times all that mattered was getting eyeballs to your site and growing your page count while showcasing content available for free. Since the bubble burst in late 2001, there have been very few webcasts trying to reach a wide mass audience with entertainment based content.

The problem is that no one has yet to find a way to monetize the content. While this is nothing new as it's a topic we talk about every day in the industry in regards to on-demand content, producing live content is even more expensive and requires more in the way of resources and time. Some have tried doing pay-per-view events with no success as consumers are not yet willing to pay for something that has always been free.

And when it comes to the content rights, entertainers want huge payments as they think this stuff is worth a lot of money online thinking as if this is some sort of PPV event on TV. They quickly learn however that there is no money to be made with PPV on the web and they always end up scraping the webcast when they realize this is not a cash cow. How many large entertainment webcasts have you seen in the past 5 years?

It is a lot of work and money to put on a webcast and even more when it's goal is to reach a global audience all at the same time. But that is exactly what MSN is looking to do with it's LiveEarth series of concerts that kicks off today at 9pm EST. The Al Gore-promoted series of concerts will have close to 40 video feeds from countries all over the world for a span of 24 hours. The cost to produce something like this runs into the tens of millions, especially since some of the content will also be broadcast via traditional TV on NBC and Bravo amongst other channels. Since it needs to be TV quality and not just web quality, that means even more cost in the way of audio and video production. Throw in the cost to license the content, pay the artists, pay for audio and video production services, satellite time, encoding services (which one article says consists of a team of 80), not to mention distribution costs to deliver this via the web and you're talking serious dollars.

Now this event may make back some of it's money since it has a traditional broadcast component on TV and NBC can sell advertising around it, but even with that, this is a loss leader. And without the TV broadcast, I bet this would not even happen unless a sponsor, or MSN, was willing to kick in millions of dollars to cover the webcasting and productions costs.

The worst part about this whole thing is that it's just going to play into the hype about millions of people watching video on the web as if it is the TV. It's not. Remember Live 8 over two years ago? How did that make money? Where are the ROI articles saying how successful the Internet medium was for webcasting to big audiences? Most of the revenue generated from that event came from DVD and content licensing deals after the webcast for mediums other than the Internet.

Already, the hype is starting. ""We expect it to be the most highly watched entertainment event online," MSN senior director Lisa Gurry said in an Hollywood Reporter article. The article also says that "MSN, predicts Live Earth will be a record-breaker." Come on. Is that the best that MSN can say? How about telling us how many sponsors you have? Or how you plan to cover your costs? Or if this is a loss leader for MSN to create awareness for the brand? Or better yet, what metrics MSN is going to use to determine the success or failure of the event? And stop with the "record-breaker" comments. There is no such thing as a record breaker webcast or "largest webcast ever" as no one makes their logs available for review and everyone measure "viewers" differently. And many large webcasts never ever give out numbers or the numbers are inflated. I know. I use to give customers numbers of viewers after a webcast only to see them make the number a lot higher in press releases, sometimes by a few million. And if IF it was the largest ever, so what? Does that mean it's successful? No.

One other thing to note, unlike the Madonna event or the Live 8 event which was only on the Internet, much of the content of LiveEarth will be on TV. So why would I go to the Internet to watch it?

It's a shame this has not all been figured out by now. Like many, I love the webcasting medium. It's fun to webcast, brings its own set of challenges and is a technology that allows anyone to communicate without any geographical boundaries. And while the application has been successful in the enterprise, government, education and other verticals it still does not work for the large-scale entertainment events.

Marketing 101: Companies In This Space Need To Do A Better Job

I find it very hard to fathom but I still run into a lot of marketing folks in person at events who say something like "I'd love for you to write about our company and to look at what we're doing but didn't know how to contact you." Or it's the line of "I saw this month's copy of Streaming Media magazine and noticed that you wrote about our competitor but not about us, why?"

Come on now, those are bad excuses. Where are your marketing skills? Marketing 101 says you always know how to contact someone in the media who may be covering the industry you are in. And if you can't find my e-mail and phone number on this blog, on the home page of StreamingMedia.com, on DanRayburn.com or all the other sites out there that list it, then you should not be in the marketing profession.

As for the idea that any member of the media can and should cover every vendor, product or service in any industry - that's just not possible. There are only so many hours in the day and vendors should make it easier for the media to know what they are doing. Especially since unlike a lot of the other blogs out there where the blog is their only job, this blog is just one of the many, many things that consumes my time. Why is it that so many vendors as me why I don't call them?!? How about being proactive and calling me?  Or how about looking at our editorial calendar on StreamingMedia.com and calling the Editor of the magazine, Eric, before we write a story and it goes to print instead of asking us when the story comes out why we didn't feature you. This happens way too often.

Now some companies do a great job. No question, there are those out there who have marketing folks and teams who help to keep us in the loop and do a really good job. And I know that not all companies have the resources of entire teams at their disposal. But there is one thing that many, many companies do that really irks me and is just dumb for your business.

Many times, I will e-mail a PR or marketing person at a company that I have dealt with before only to have two things happen. One, the e-mail bounces back to me saying no person with that name exists. Ok, so if the person has moved on, why the hell doesn't the company have that address setup to forward to another PR or marketing person!!! Now I am stuck with no PR contact and not even an automated message in the e-mail telling me who the new person is to contact. How is that good for your business? Many of you may be surprised but this happens all the time.

Second, the e-mail won't bounce back but I will never hear from the person. After having to call around in the company, I'll find out that the person is no longer there and there is either a new person to contact or no one knows who you should contact. How can this be? If the person has left the company, have an automated reply come back when I send the e-mail letting me know that. Bouncing the e-mail is bad, but accepting it and then not following up on it is even worse as I have no way of knowing the person is now gone. This is why many times, someone from your company gets invited to speak at a show one year and not the next. Your speakers placement person has left the company and I am e-mailing someone who is not there.

Also, why I am ranting about marketing issues, why do companies post press releases on their websites as PDF documents? It makes it a lot harder to search the release for specific words, it's harder to share a link to a PDF with someone in an e-mail and Google and others don't index the contents of PDFs so you lose out on potential traffic. The whole reason to  put out a press release is to get it in front of as many "qualified" media people as possible, but you put it in a format that is then hard for us to work with.

Also, many times we are on deadline, which you should understand but many companies don't. If any member of the media e-mails you with a question, speaking invite, quote request etc... and says they need to hear back within a certain period of time, why do you respond literally a week after the deadline? Now if you don't want the press or don't care about the coverage, ok, that's fair. But when you call back a week later and act all surprised that the opportunity is no longer available, why do you seem so surprised? This happens quite often as well.

Again, not all companies are like this. Many are very good. But way too many aren't. The bottom line is that many companies need to be more proactive and follow basic marketing rules that all companies should be applying to maximize their exposure in the industry.

Note: The editorial calendar is not currently on the Streaming Media magazine page as we just took it down and are creating a new one for the second half of the year. It will be up shortly.

Fast Company Article Highlights Comcast's Web Video Strategy

There is a good article from Fast Company this month that profiles Comcast's online video business which has been around for over five years now. It's an interesting read since most cable companies have only recently begun to have online video strategies while the Comcast.net portal was launched in 2001 amidst down times in the industry. The article highlights the correct mentality that Comcast had back then to know how important a role online video would play to cable companies years later.

This summer, Comcast's new video portal FanCast is expected to launch and will contain content from the newly formed NBC and News Corp. joint venture.

BusinessWeek Article: "A Better Way to Stream TV?" Gets It Wrong

I like BusinessWeek. It's the one publication I always make time to read no matter how many start to stack up on my desk. But an article from last week entitled "A Better Way to Stream TV?" features a profile about a Israeli based startup, Arootz, who says it can satisfy Web video demand using multicasting and cheap hard-drives.

By itself, not a bad topic to cover, but there are many places where the article never questions the hype clearly being fed to the author by the vendor. Why are so many people in the media falling for the idea that the web is breaking when it comes to video delivery? Four sentences in, the article starts with the hype saying, "The demands of streaming video over the Net are already starting to put a strain on both the infrastructure and the business models of the world's Internet service providers (ISPs)." Really? Please give one example.

The article explains that Artooz says it has devised a solution that greatly increases the Net's ability to deliver video without requiring substantial new infrastructure by multicasting and by using "off-the-shelf hard drives that can store vast amounts of data fast and cheap." Apparently, the author thinks or was told by Artooz that, "The combination of the two represents a radical new approach to using the Net." Wrong. Multicasting has been around for at least ten years and is anything but new. And using cheap hard drives to store videos, well that's what everyone has been doing for years. Where is the radical approach? Store and forward models for video have been used for years.

The article goes on to say that, "The company figures that all of Israel could be served with just one server farm, while the U.S. could be covered with about 20." More hype. 20 servers to cover how many users? Also says that, "Providers of Net-based TV services, such as Joost (which uses a P2P architecture) and Babelgum, are bound to be interested in what Arootz is up to". Why? Multicasting has been around for so long now, that if multicasting was a reasonable option, more networks and ISPs would be multicast enabled, but they aren't for many reasons.

What the article doesn't say is how this technology is going to work to deliver content to someone who uses an ISP that is NOT multicast enabled. More questions than answers.

NY Video 2.0 Meetup in NYC: Beyond Pre-Roll, What's Next for Online Video Advertising?

The next NY Video 2.0 Meetup will take place Monday July 9th in NYC at the Columbia Business School. I'll be moderating a panel entitled "Beyond Pre-Roll: What's Next for Online Video Advertising?" starting at 7pm. The panelists for this discussion will be:

• Kevin McGurn, VP, Advertising, nbbc
• Jeff Minsky, Director of Digital Media, OMD
• Robert Victor, Product Manager, Emerging Media, DoubleClick
• Jed Savage, EVP, Strategy and Development, ScanScout

This is a great chance to come hear if anyone is making money with online video advertising and learn the going CPM rates for video ads. As always, the event is free but the room size is limited to 200 attendees. As of today, there are only 26 spots left, so RSVP now if you want to attend.

Have any questions for the panelists? Leave them in the comments section and I'll ask them during the Q&A portion of the session.

Judge Issues Ruling In Favor Of Limelight Networks Over Akamai Patent Lawsuit

On Friday, District Court judge Rya Zobel issued a preliminary ruling in the patent infringement lawsuit that Akamai filed against Limelight Networks. Shares in Limelight rose over $4 after the ruling. While I have not had time to read the entire ruling yet, essentially the court rejected the notion that Akamai could patent the way files were delivered over the Internet as per an article on Light Reading.

The article on Light Reading includes quotes that say, "What happened was Akamai was trying to patent the process, as opposed to its technology," Stimson said. "And the judge said, 'That's not a process you can patent."

I have not had a chance to speak to anyone from Limelight Networks or Akamai personally yet and neither of the companies have yet to put out an official statement on the wire about the ruling. IF this is the end of the litigation that would be good for both companies and the industry. While lawsuits are part of all industries, they distract all companies involved and don't allow them to focus all of their efforts on their core business.

I expect we'll hear more from Akamai and Limelight Networks with official announcements about the ruling before too long.

YouTube Does NOT Equal 10% Of All Traffic On The Internet

Last week, I saw a lot of bloggers and news sites talking about a press release put out by Ellacoya Networks, a communications equipment company, that says YouTube accounts for nearly 10% of all traffic on the Internet. Yet, I didn't notice any bloggers who questioned the report or the data in it. The idea that any company would put out a report that says "YouTube alone comprises approximately 20% of all HTTP traffic, or nearly 10% of all traffic on the Internet" without data to back up such a claim, is absurd.

Looking at the details they announced it says they "released findings based on usage data of approximately one million broadband subscribers in North America". So how does 1 million subscribers in only North America account for all traffic on the Internet when the Internet is global?

Plus, Ellacoya Networks can't even take the data it has and present it properly. It says, "Breaking down application types within HTTP, the data reveals that traditional Web page downloads represent 45% of all Web traffic. Streaming video represents 36% and streaming audio 5% of all HTTP traffic." Say what? If is is "streaming video" like you say, then how can it be HTTP based? Which one is it? Streaming or HTTP?

They use the term streaming and download in the same phrase twice in the four paragraph release. "Presently, as a result of streaming audio and video in Web downloads, HTTP is approximately 46% of all traffic on the network." Are you talking progressive downloads or streaming?

And they end the press release with a quote that includes them saying, "The way people use the Internet is changing rapidly - from browsing to real-time streaming. We expect to see new applications over the next year that will accelerate this trend." That may be, but you didn't report on anything that was "real-time streaming" based.

The news sites and bloggers should be doing a better job of questioning data like this and not just posting highlights of a press release just so they have another blog post for the day.

New HD DVD Features Allows Consumers To Edit And Upload Video

As Blu-ray and HD DVD continue to battle it out over which format will dominate the market, last week, HD DVD released its first title that incorporates new user features that involves online video. These new features allows anyone who connects their HD DVD player to the Internet via a broadband connection the ability to download trailers to other movies, change menu styles and download other subtitles.

But the most interesting feature is that it will allow anyone to re-edit the movie, arranging the scenes as they want and then allow them to upload their edited video to a server hosted by the studio, in this case to Warner Brothers, for the movie 300. The other users can download that version of the movie to their HD DVD players and watch the re-edited video. What I'm trying to find out is what the technology is behind this, what compression is being used and how large of a file is the user uploading from their house to the studio. And where is the file saved that is being downloaded? To some sort of drive in the HD DVD player or to the disc itself? I can't find any technical details on the HD DVD site.

All of this seems like a bit of last ditch effort for HD DVD which clearly is not getting the market penetration over Blu-ray. Yes, from the data I have read, more HD DVD players have been sold than Blu-ray, but it's all going to come down to what content is available. The content will dictate which format wins. And the announcement by Blockbuster two weeks ago that it would not stock HD DVDs when it expands the high-definition section in its 1,450 stores next month and will only stock Blu-ray, is another bad sign for HD DVD.

I say good, let one of these formats fall by the wayside and lets get some standards when it comes to something in U.S.