Posts for 'TubeMogul'

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Broadband-only producers got a boost yesterday as blip.tv, which provides technology, ad sales and distribution for thousands of online shows, announced a variety of new deals as well as product improvements. The deals offer blip's producers new distribution, new monetization and new access to TVs. In order:

Distribution: blip's new deal with YouTube means that producers using blip can deliver their episodes directly to their YouTube accounts, eliminating the two step process. With YouTube's massive traffic, getting in front of this audience is critical to any independent producer. Since my first conversation with blip's co-founder Mike Hudack several years ago, the company's mantra has been widespread syndication. Blip already distributed its producers' shows to iTunes, AOL Video, MSN Video, Facebook, Twitter, and others. Vimeo is another new distribution partner announced yesterday.

Monetization: A new integration with FreeWheel means that ads blip sells can follow the programs it distributes wherever they may be viewed. I've written about FreeWheel in the past, which offers essential monetization capability for the Syndicated Video Economy. With the blip deal, FreeWheel delivered ads can be inserted on YouTube. This follows news earlier this week that YouTube and FreeWheel had struck an agreement which allows content providers that use FreeWheel and distribute their video on YouTube can have FreeWheel insert their ads on YouTube (slowly but surely YouTube is opening itself up to 3rd parties).

Access to TVs - Last but not least is blip's integration with the Roku player which will help bring blip's shows directly to TVs (adding to deals blip already had with TiVo, Sony Bravia, Verizon FiOS, Boxee and Apple TV). While Roku's footprint is still modest, it is positioned for major growth given current deals with Netflix and Amazon, and others no doubt pending. At $100, Roku is an inexpensive and easy-to-operate convergence device that is a great option for consumers trying to gain broadband access on their TVs. Gaining parity access to TV audiences for its broadband producers is a key value proposition for blip.

In addition to the above, blip also redesigned its dashboard and work flow, making it easier for producers to manage their shows along with their distribution and monetization. An additional deal with TubeMogul announced yesterday allows second by second viewer tracking, providing more insight on engagement.

Taken together the new deals help blip further realize its vision of being a "next generation TV network" and provide much-needed services to broadband-only producers. This group has taken a hit this year, given the tough ad sales and funding environments, so they need every advantage they can get.

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• TubeMogul (3M) 4/1 - Trinity Ventures
• ScanScout ($5.1M) 4/13
• FreeWheel ($12M) 4/30 - Foundation Capital
• Azuki Systems ($6M) 5/5
• EveryZing ($8.25M) 5/11 - Peacock Equity
• Grab Networks ($12M) 6/2
• beeTV ($8M) 6/3 - Innogest
• YuMe ($2.9M) 6/12
• Nokeena Networks ($6.5M) 6/25 - Mayfield

(Note that I've included beeTV, which offers a cross-platform TV recommendation system, so isn't a pure broadband or mobile video company. On the other hand, one might argue that Sugar's $16M round should also be included, since the company simultaneously announced the acquisition of video-oriented Shopflick.com and launch of Sugar Digital Entertainment. However, I haven't counted it since Sugar's more of a pure blog network.)

Excluding Sugar, the $64M comes on the heels of approximately $75M raised in Q1 '09 and over $80M raised in Q4 '08. That means over the last 3 quarters - arguably the heart of the current recession - at least 26 companies have raised a total of $219M. To be sure, everyone I've spoken to has told me these rounds have been hard work to raise, but these companies' successes demonstrate the appeal of the broadband video sector to investors and their anticipation for continued rapid growth.

One thing worth noting is that of the 26 companies, not a single one is a video producer itself, or even an aggregator of video. There has been a significant shift in investor sentiment away from content and towards the platforms and tools required to power video. While that's lamentable, it's also completely understandable. The bruising advertising environment, combined with ongoing business model uncertainty and the death of certain independent producers (e.g. 60Frames, Ripe Digital, etc.) has frozen new content investments. Aggregators aren't faring much better. Just today it was reported that Joost CEO Mike Volpi is stepping aside, as the company tries to relaunch itself as a technology provider. Veoh also restructured during the quarter, shedding half its staff and replacing CEO Steve Mitgang (in addition, just yesterday a VideoNuze reader emailed me saying he can't seem to find a working phone number for the company).

Couple all this with the rise of Hulu, the dominance of YouTube, the entry of cable operators and networks with TV Everywhere, and it's clear that on the content side at least, incumbents and earlier market entrants are ascendant, while more recent entrants and startups are having a tough time surviving the downturn. I anticipate this will continue to be the trend, at least until the economy rebounds.

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Here's another sign of the times: thePlatform is announcing this morning that it has launched three new initiatives aimed at reducing small-to-medium (SMB) sized content providers' total cost of running their broadband video operations. In the context of the woeful economy, it's a savvy move.

In effect thePlatform (note, a VideoNuze sponsor) is using its scale to create a buyer's cooperative to save money on three services (CDN, storage and others), thereby enabling its SMB customers to receive pricing comparable to what big customers can negotiate themselves. With thePlatform's customers driving 440 million video views in December '08, (3rd place after Google's site and Fox Interactive Media) according to comScore, the company is in a strong position to use its size on behalf of its SMB customers. I talked to Marty Roberts, thePlatform's VP Marketing, who explained the specifics of how the savings would work.

thePlatform's initiatives are based on an analysis it conducted of its SMB customers' key cost elements. No surprise, the cost of delivery was the biggest chunk, coming in at 78% of total. This was calculated using a set of assumptions including $.55/GB for delivery. For its new "mpsManage CDN" service, thePlatform has partnered with EdgeCast to resell its service for $.35/GB, resulting in a 36% savings on delivery costs. It will also be available on a utility basis, meaning no monthly commitments. Marty said that thePlatform will continue to work with its other 15 CDN partners, but I would guess that this new program is going to gain a lot of attention among its SMB customer base.

Delivery costs have always been a central issue for making the broadband P&L work. Having done many business cases for various content providers over the years, I'm well-acquainted with how quickly CDN costs can gobble up potential profitability even though the cost/GB delivered has plunged over the years. Yet there is a raft of CDNs out there to choose from, and the key is finding the right one for your needs at the moment and your budget. Still delivery costs persist as a major flashpoint: some of you may have read Mark Cuban's post just 2 weeks ago "The Great Internet Video Lie" in which he basically asserted that large CDNs and their pricing are the real gatekeepers to a truly open broadband distribution model (for the record, I think some of his points are valid, but long-term his logic is flawed).

The other programs thePlatform is rolling out are important, though not as impactful as the delivery option, simply because their percentage of underlying total costs is so much smaller in size. thePlatform is offering a new storage program which slashes the cost of storage from $8/GB on average, to $2/GB. Though a big cut, thePlatform calculates storage only accounts for 5% of total costs today.

Lastly, through its new Advantage program it's tapping into a select group of its ecosystem partners to find another 10% or more cost reduction on services like advertising, reporting and analytics and online community creation. Advantage program participants include Panache, BlackArrow, TubeMogul, Live Rail, ScanScout, Gloto and Visible Measures.

Add it all up and thePlatform believes it can offer a 32% reduction in "total cost of ownership" for SMB video content providers. These new services create a new revenue stream for the company, as the reduced prices include a margin for thePlatform as well. And as Marty pointed out the SMB space is quite vibrant and these programs will allow thePlatform to be more competitive in winning deals by giving them another negotiating lever.

thePlatform's moves are also smart from a positioning standpoint; in this troubled economy I think providers who overtly message that they are doing what they can to save customers money generate valuable notoriety. In good times everyone's focused on top-line growth and wants more features and flexibility. In bad times those goals are still valued, but saving money - which can often make the difference in merely surviving - is prized over everything else (Ben Franklin said it best: "a penny saved is a penny earned"). As a result, I suspect we'll see more companies unveiling messages of this kind in the months to come.

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