Enterprise Video Still Growing: Ecosystem and SaaS The Focus

While the news and media tend to focus mostly on consumer facing content because it is cool and sexy, the enterprise market continues to have very strong growth and demand for IP based video products and services. Webcasting platforms, capture cards, hardware encoders and content management systems, amongst others products, are still being bought and deployed across all enterprise-focused verticals. The nice thing about any vendor selling into the enterprise market is that they don't have to show customers how to monetize their content. Enterprise companies understand the value of the video ecosystem and know that using video for communications, marketing, and general business practices is just another business tool at their disposal.

I talk to a lot of enterprise companies each week and get to hear first hand how much video they are using, the products and services being deployed and what challenges they face when deploying video inside their network. If I had to estimate, about 10-15% of the readers to StreamingMedia.com are from the enterprise vertical, which I classify as Fortune 1000 companies who are not trying to monetize content. The one problem with the enterprise market is that historically, these companies are very quiet about giving out details on what they are doing, whom they use and the volume and growth they are seeing. I get a lot of details from them but rarely am able to share numbers and data, and in many cases, can't even use the company name. But rest assured, even with the economy being what it is today, they are still spending money for many of the products and services in the video ecosystem.

Whenever possible, StreamingMedia.com features case studies on some of these video deployments and we have a whole section on the site dedicated just to enterprise video. In the coming weeks, when we move our discussion lists over to an in-house web-based system, I will also be working hard to launch and build a new enterprise focused video discussion list. There is a lot taking place in the enterprise video market and we need a good forum to discuss what is taking place.

Speaking of enterprise video solutions, yesterday, video platform provider Qumu, formerly Media Publisher, announced it has raised $10.7 million in a series C round. To date, Qumu has raised just over $18 million since 2005. While Qumu is private and does not give out any details on revenue, I estimate they will do around $10 million for 2008. And last week, webcasting services company ON24 announced it had raised $8 million, bringing their total money raised to date to just over $46 million.

Amongst vendors who are selling into the enterprise market, the two biggest trends I am seeing them focus on is the entire ecosystem problem (capture, encode, manage, publish, deliver) and offering their web based platforms via software as a service (SaaS). Without a doubt, the hardest challenge for enterprise customers is the ecosystem since they tend to manage 100% of the workflow internally across their network. Vendors know this and have been working to solve this problem for some time. But the offering of their web based platforms on a SaaS model is pretty new. It is an interesting approach as many enterprise companies already buy other software services this way and typically it enables the customer to deploy and test the offering without having to spend a lot of money upfront.

I think it is too early to know if selling web based webcasting platforms via SaaS will be successful, but to date, companies who have been offering this to the market for a short time have said that they have started to see some traction from the model. Will be interesting to re-visit this topic a year from now and judge whether this new trend is really evolving with customers.

Comments

[macguitarman]

Wow, this is cool, glad I found this.

I am a Sr. Systems Engineer at a hospital in Los Angeles, my background is in pro audio and video, post production, and IT, having worked at Apple on Final Cut Pro.

Very interested in this as it applies to the enterprise, a kind of hollywood, broadcast, post production meets the corp world, and we are in the midst of rolling out a solution, but what?

Did not realize the host of players involved in this,

Software and (capture boxes): Wowza, Accordent, Qumu, Sonic Foundry, Vbrick, Limelight, Daydream,., goes on and on.

I am compiling all of this info.

I can see it already it is coming down to the video formats and architectures, 3 mainly:

Flash, H,264 (which Flash supports), Silverlight

I am not impressed at all with MS's Silverlight and it of course being tied to WMV.

The other sides of all of this is of course are:

- hardware encoders: (Tandberg, Envivio, Hai Vision, etc)

- Audio Video conferencing and new network transport pieces, SIP, Call Manager, etc) and to me H.264 is here and the future.

Note and of huge importance: Believe me, forget H.323, it's old and over, anyone doing this, make sure all is SIP / Call Manager.

I am also just not feeling any hardware boxes / solutions that choose to encode WMV, why? Because when, the industry does not know better, often times they default to Microsoft, never mind investigating any further.

Not impressed with MeidaSite or Accordent. They are extremely expensive, 50 plus grand, and neither MediaSite or Accordent support direct recording of H.264., Uh?

And many of these companies, like Accordent or MediaSite, could care less about Mac support, they say they support Macs but upon further review, they admit, Macs are not a priority.

OK, goodbye, you just lost my business, 100's of thousands of dollar.

Any solution, must be based on open standards, protocols and formats, and Silverlight is not open (either really is Flash), but at least it accommodates H.264.

And if your solution is Silverlight based, what's the issue?, the Silverlight plugin exists for the Mac.

But in typical fashion it seems with Silverlight for Mac OS X, is not "real" Silverlight on Windows.
Typical Microsoft, cripple the Mac experience, just another trumped up MS technology to minimize Macs, and H.264 (or Flash) growth. Not going to fall for it.

We'll see, the iPhone is key here, in that it will be in very short order the chosen consumer device that dictates the most popular, most used format, just as with the iPod, and that is hands down, H.264.

Hopefully these companies realize what they are really saying, the most popular consumer playback device, the iPod/iPhone, H.264 is not a priority, Uh?, that will be changing soon and fast.

There are going to be a lot of iPhone (mobile H.264 players) sold and people (VIP corp type) people, etc, will want to play corp content on their iPhone, and that will be H.264, not WMV (Apple will never allow WMV on the iPhone, why?, who really cares, you don't even see this on the iTunes Store/iPod).

So, some say Apple / Macs are irrelevant in the Corp / enterprise space, but not true, in that Apple iPhones will be just the opposite, leading the way and taking over, and that will be H.264.

And can we trust Apple's QuickTime Streaming Server in an Enterprise environment (perhaps Apple is the only one using it for the iTunes Store with Web Objects, etc.) but what about the rest of the enterprise, who can't even begin to imagine Apple in data center. I don't see Apple QTSS widespread adoption in the typical data center anytime soon, I could be wrong and hope I am.

Or perhaps this ultimately means Flash, since Flash includes / support for H.264.

Would love to see an ongoing forum/ discussion here on this.

Thanks,

Any feedback greatly appreciated,

http://macguitarman.wordpress.com
macguitarman@mac.com

[Rahul Kapoor]

Hello Dan,

I did some back of the envelope calculation for SMB enterprise small video application business model. Thought it would be interesting to post it here since it might be useful to your readers.

The results are on my blog, http://onlinevideobusiness.blogspot.com/, but bottomline is

1. That serving online videos is not a highly profitable business model by itself

2. Important to have a handle on streaming costs.

Comments welcome.

[don smith]

This is a good section to bring to your site. Although media asset management is most often associated with the video vertical market, our company launched a hosted subscription based media asset management tool in 2008 to support corporate marcom applications where virtual marketing teams are now becoming commonplace. The most common complaint we hear from marketing people in the enterprise is that IT becomes a barrier that prevents them from working effectively with outside contractors and members of the virtual marketing team. We conducted a number of trials with corporate marcom groups, corporate production professionals, and duplication houses. The california department of education uses this for teachers with the star program. We are actively promoting our hosted media asset management services to the enterprise.