Some start-ups go to great lengths for visibility before ever launching a product or landing a customer, whereas others stay completely below the radar until they have big concrete news to share. Squarely in the latter category is eyeIO (never mind the awkward name) an "ultra-low-bandwidth" encoding technology provider that has a bare bones web site, but does have a very high-profile first customer in Netflix. Yesterday, Rodolfo Vargas, eyeIO's CEO and co-founder and Charles Steinberg, another co-founder updated me, though they are still playing things pretty close to the vest.

eyeIO has created a new, optimized process for compressing video for the H.264 standard that results in 20-50% bandwidth savings (depending on the particular network circumstances), while still delivering comparable or better video quality to existing devices without any new software. eyeIO can operate in a managed encoding center or in the cloud. If, like me, you're keen to know how eyeIO is doing this, you'll be disappointed, eyeIO is keeping its secret sauce under wraps.

However, as expected, Netflix did extensive lab and field testing before integrating eyeIO into its technology stack, and given Netflix's reputation for operational meticulousness, that's a pretty strong validation. eyeIO technology is now also being tested by Tektronix and THX to further document its capabilities.

Bandwidth is a key pain point for Netflix which is rapidly expanding internationally where pricing can be high and quality can be unpredictable. In addition, with Netflix's low prices, there is constant pressure to minimize expenses. Rodolfo said that Netflix has licensed eyeIO, but cannot say exactly where and how Netflix has implemented it. However, he believes that the savings eyeIO creates is a key enabler of Netflix's ability to pursue its international agenda.

In addition to the bandwidth savings, eyeIO also offers an adaptive bit rate streaming feature that allows video to start quickly with good quality and improve to HD. Rodolfo estimates that start time for a Netflix streaming video is close to 2-3 seconds with eyeIO, whereas typical start times are closer to 20-30 seconds.

eyeIO has five full-time employees plus a group of contractors. Ordinarily I'm a bit cautious when little information is available about new start-ups. However, the Netflix endorsement means a lot, as does the strength of the team (Rodolfo is formerly the senior program manager of video at Microsoft, while Charles is a former executive at Ampex and Sony, and a third co-founder, Robert Hagerty is a former chairman and CEO of Polycom). Rodolfo said they're engaged in discussions with all the various OTT and broadband content companies that would benefit from the cost savings eyeIO enables, and that more deals will be announced soon.