Posts for 'YouTube'

Looking over last month's posts with an eye for 2-3 themes to extract for my recap post today, I was instead struck by one overarching theme: innovation is alive and well in the broadband video space. Other sectors of the economy may have ground to a halt in the current recession, but whether it's new technologies, new service models or new approaches by traditional media companies, the pace of innovation in all things related to broadband video seems only to be accelerating.

Here are some of the examples from last month's posts:

New technologies

• SundaySky - a new approach to dynamically generate videos out of web site content
• HD Cloud - cloud-based encoding and transcoding plus 3rd party syndication
• Market7 - web-based platform for collaboratively creating and producing video
• FreeWheel - ad management/distribution company raises another $12M

New service models

• Sezmi - next-gen video service provider aiming to replace cable/satellite/telco
• TurnHere - distributed video production services for the corporate market
• Babelgum - premium-quality content destination for independent producers
• YuMe Mindshare iGRP - new measurement unit to compare on-air and online ad performance
• YouTube-Disney - short-form promotional deal

New approaches by traditional media companies

• Disney-Hulu - Exclusive 3rd party online distribution for established broadcast network
• Cable networks launching webisodes - online initiatives to attract and retain new online audiences
• New York magazine video re-launch - emphasis on curating best-of-the web videos with brand
• WWE Smashup - fan-submitted video mashup content driving awareness of on-air special

Now granted I have an eye out for broadband innovations so this list is somewhat self-serving. But remember that for every item above I was probably pitched on 2-3 others that I didn't write about due to time limitations. Some of these other items may have been picked up by other news outlets and captured in the news aggregation side of VideoNuze, while plenty of them likely received little attention.

My point is that throughout the whole broadband video ecosystem there is a vibrant sense of entrepreneurialism that is slowly but surely remaking the traditional video landscape. To be sure, not all of this stuff is going to work out; either business models will be faulty, technologies won't deliver as promised or consumers will reject what they're being offered. Nonetheless, from my vantage point, the wheels of innovation continue to spin faster. That makes it a very exciting time to be part of the industry.

What do you think? Post a comment now.

Late yesterday YouTube announced "a new destination for TV shows and an improved destination for movies," moves that continue the site's evolution from its UGC/video sharing roots to an aggregator of premium-quality video.

The reality is that this evolution has been underway for some time now, and I expect it will only continue. Two weeks ago in "6 Reasons Why the Disney-YouTube Deal Matters" I explained again why, as the 8,000 pound gorilla of the online video market, YouTube is in an excellent position to partner with premium content providers. In a media landscape marked by massive audience fragmentation, the online destination (YouTube) that accounts for 40-50% of all streams and is 15 times as big as the #2 destination (Hulu) is quite simply a must-have promotion and distribution partner.

The new destinations address what has been an ongoing Achilles' heel for the site - enabling users to easily find premium video "needles" in YouTube's user-generated "haystack." YouTube's UI weaknesses for premium video have been highlighted by the gold-plated user experience Hulu - and more recently TV.com and Sling.com - have brought to market. The sites have quickly gained passionate fans, and at least in the case of Hulu, significant viewership.

Possibly more important though, is that for content providers they show how YouTube is serious about addressing their needs for clean, well-lit spaces. Premium content providers want the benefits of being in the massive YouTube site, but without the risk of their brands showing up too close to scruffy UGC material. Being clustered with other premium content is a must.

YouTube's concurrent beta launch of Google TV Ads Online, which allows targeted instream ads, is another positive for premium content providers. Beyond YouTube's massive traffic, Google's potent monetization capabilities are the other reason I've been so bullish on YouTube's prospects for premium content. As I wrote on Monday, with increased DVR penetration driving rampant ad-skipping, broadcast and cable's traditional ad model is looking more and more defunct. Online video ads offer a lot of promise as an even higher value ad medium, but much of it is still unproven. Having large players like Google and YouTube involved is significant for showing online video advertising's true upside.

One last take on this is how YouTube continues to position itself in the "over-the-top" sweepstakes, where multiple competitors are vying to be viewed as bona fide substitutes for cable/satellite/telco subscribers itching to cut the cord. I remain skeptical that the trickle of cord-cutters is going to turn into a gusher any time soon, but I will say that with its move up the content ladder, YouTube continues to burnish its standing as a must-have partner for any convergence device-maker looking to make over-the-top inroads (e.g. Roku, Vudu, AppleTV, etc.). YouTube is the most-recognized online video brand, the most-heavily trafficked, and increasingly a credible alternative to premium aggregators like Hulu and others.

For everyone in the online video ecosystem, YouTube continues to be a key player to watch.

What do you think? Post a comment now.

Below is the 12th edition of the VideoNuze Report podcast, for April 3, 2009.

After a week off, Daisy Whitney and I are back. This week we discuss new comScore data Daisy learned about while attending the OMMA Video conference, which supports the idea of TV ad spending shifting from TV to broadband video. Then we dig deeper into the significance of Disney's deal to bring promotional clips to YouTube, which the companies announced earlier this week. More detail on the deal is also in this post I wrote on Tuesday.

Click the play button to listen to the podcast (13 minutes, 49 seconds):

Click here for previous podcasts

The VideoNuze Report is available in iTunes...subscribe today!

In a surprising turn-of-events, VideoNuze has learned that Google will acquire Hulu and merge it with YouTube. The resulting entity will be named either 'YouLu' or 'HuTube.' The merger brings together the two most-trafficked video sites into a powerful new player.

In an interesting twist, the final acquisition price has not yet been determined. Instead, the price will be based on a new algorithm Google is creating to accurately measure just how effective Hulu is at turning its users' brains into 'creamy giggity-goo' as Seth MacFarlane asserts it will in the latest of Hulu's alien-inspired ads. The algorithm will actually be able to count how many more of users' brain cells die as a result of watching shows on Hulu beyond the cells that already died due to regular on-air network TV viewership.

It turns out that Hulu's positioning as an 'evil plot to destroy the world' was considered highly synergistic with Google's longstanding mantra to 'do no evil.' Google CEO Eric Schmidt revealed that the company decided some time ago to move beyond its good-guy image, saying, "Look, we got a lot of mileage out of that 'doing no evil' malarkey, but it's time to get real. We're an avaricious multi-billion company now, and all these wacky tree-hugging green initiatives our engineers keep dreaming up can't hide that." He added, "We really admire the traction Hulu is getting by turning 'evil' into a virtue and want to tap into that concept further. Those Hollywood guys beat us hands-down when it comes to creativity."

For its part, Hulu's owners' decision to merge with YouTube, for a price not yet quantifiable, can only be seen as waiving the white flag of surrender. In an email exchange between Jeff Zucker, NBCU's CEO and Peter Chernin, Fox's former CEO (who made the original Hulu deal), obtained by VideoNuze, Zucker's frustration with Hulu's distant second place status is palpable. Among other things he says, "I thought we had dumbed down our shows as much as possible, but YouTube has clearly tapped into audiences' insatiable appetite for the inane. Who would have thought that skateboard-riding cats crashing into walls would have more audience appeal than our $2 million/episode scripted dramas. There really is no accounting for taste."

In response Chernin is quoted as saying, "Rupert always thought Hulu was a small potatoes deal, not really capable of losing a large, exciting amount of money. On the other hand, YouTube has been a gigantic black hole for Google, so the opportunity to join forces and achieve scale at losing money together was just incredibly compelling." He added, "Plus, you have to remember, Rupert's heart is really in newspapers. He continues to think this whole Internet thing is a fad that will eventually blow over, with people returning to newspapers as their trusted source of news and propaganda. So the company is logically positioning itself to have sizable video losses to offset expected massive gains in newspaper profitability."

Meanwhile, in a meeting with employees, Hulu CEO Jason Kilar reportedly sought to put a positive spin on the merger. Employees who have Twittered the meeting say that to pump up employee enthusiasm he re-told stories of how much fun it was to originally come up with the name 'Hulu,' reportedly saying, "Look how much mileage we got of one ridiculous-sounding made-up name, just imagine the branding possibilities of the even more-ridiculous sounding names YouLu or HuTube..." Negotiations are already underway with the Chinese portal and domain parking company that own the respective URLs.

The merger left many industry analysts scratching their heads. Representative of their reaction, VideoNuze's Will Richmond said, "Geez, I never thought we'd see a more nonsensical media merger than the one between Time Warner and AOL, but I think this YouLu/HuTube thing might just be it. Let's hope it's not for real, and is just some kind of April Fool's Day joke cooked up by an industry analyst to provide some once-per-year, cheap laughs."

Late yesterday's announcement that Disney-ABC and ESPN would launch a number of ad-supported channels focused on short-form content was yet another meaningful step in broadband video's maturation process. Here are 6 reasons why I think the deal matters:

1. It validates YouTube as a must-have promotional and distribution partner

For many content providers it's long since become standard practice to distribute clips, and often full-length content, on YouTube. Yet aside from CBS, no broadcast TV network has seriously leveraged YouTube. That's been a key missed opportunity, as YouTube is simply too big to ignore. It's not just that YouTube notched 100M unique viewers in Feb. '09 according to comScore, it's that the site has achieved dramatically more market share momentum over the past 2 years than anyone else, increasing from 16.2% of all streams to 41% of all streams.

Increasingly, YouTube is not the 800 pound gorilla of the broadband video market; it's the 8,000 pound gorilla. Disney has acknowledged what has long been tacitly understood - as a video content provider, it's impossible to succeed fully without a YouTube relationship.

2. It creates a path for full-length Disney-ABC programming to appear on YouTube and elsewhere

While this deal only contemplates short-form video, and more than likely, mostly promotional clips, it almost certainly creates a path for full-length episodes to appear as well, as the partners build trust in each other and learn how to monetize. Full-length content is most likely to come from ABC, not ESPN (the release pointedly states no long-form content from ESPN's linear networks is included) as part of a newly expanded distribution approach.

For YouTube, which has been aggressively evolving from its UGC roots in its quest to generate revenues, the current clip deal alone is a big win; gaining distribution rights to full-length programs would be an even more significant step. Underscoring YouTube's flexibility, the current deal allows ESPN's player to be embedded, and for Disney-ABC to retain ad sales. YouTube's reported redesign, which places more emphasis on premium content, is yet another way it is getting its house in order for premium content deals.

3. It opens up a new opportunity for original short-form video to flourish

When you think about broadcast TV networks and studios, you immediately think of conventional long-form content. Yet all of these companies have been producing short-form content that either augments their broadcast programs, or is originally produced for broadband, as Disney's own Stage 9 is pursuing. The levels of success of this content have been all over the board.

With YouTube as a formal partner, Disney can aggressively leverage it as its primary distribution platform, gaining more direct access to this vast audience. Facing unremitting market pressures on many fronts, broadcast TV networks themselves need to reinvent their business models. Short-form original content married to strong distribution from YouTube would be a whole new strategic opportunity.

4. It puts pressure on Hulu and other aggregators

It's hard not to see YouTube's gain as Hulu's - and other aggregators' - loss. For sure nothing's exclusive here, and as PaidContent has reported, discussions about Disney distributing full-length programs on Hulu (as well as YouTube) are also underway. But the Disney deal underscores something important that differentiates YouTube from Hulu: YouTube is both a massive promotional vehicle and a potential long-form distributor, while Hulu is really only the latter.

YouTube's benefit derives from its first-mover status. Hulu has done a tremendous job building traffic and credibility in its short life, but it is still distant to YouTube in terms of reach. I continue to believe it is far easier for YouTube to evolve from its UGC roots to become also become a premium outlet than it is for Hulu - or anyone else - to ever compete with YouTube's reach.

5. It raises threat warning to incumbent service providers by another notch

It's also hard not to see the Disney deal moving YouTube's threat level to incumbent video service providers (cable/satellite/telco) up another notch. We discussed YouTube's importance to these companies at the Broadband Video Leadership Evening 2 weeks ago (video here), and I thought the panelists generally did not give YouTube much credit as it deserves.

I continue to believe that of all the various "over-the-top" threats to the current world-order, YouTube is the most meaningful ad-supported one. It has massive audience, a potent monetization engine in Google's AdWords, and with the Disney deal, increased credibility with premium content providers. Especially for younger audiences, the YouTube brand means a lot more than any incumbent service provider's. If I were at Comcast, Verizon or DirecTV, I'd be keeping very close tabs on YouTube's evolution.

6. It exposes the absurdity of the ongoing Viacom-Google litigation

Two weeks ago at the Media Summit I listened to Viacom CEO Philippe Dauman describe the status of his company's $1 billion lawsuit against Google and YouTube. As he talked of mounds of data and reams of documentation being collected and reviewed, I found myself slumping in my chair, thinking about how well all the lawyers involved in the case must be doing, and yet how pointless it all seems.

The old adage "2 wrongs don't make a right" fits this situation perfectly. There is no question that in the past YouTube was lax about enforcing copyright protection on its site and cavalier about how it responded publicly to the concerns of rights-holders. But it has made much progress with its Content ID system and a good faith effort to become a trusted partner. All of this is evidenced by the fact that Disney wouldn't even be talking to YouTube, much less cutting a deal, if it didn't view YouTube as reformed. While the media world is moving on, adapting itself to the new rules of video creation, promotion and distribution, Viacom continues to waste resources and executive attention pursuing this case. To be sure, Viacom has been plenty active on the digital front, but it is long overdue that these companies figure out how to resolve their differences and instead focus on how to work together to generate profits for themselves, not their lawyers.

What do you think? Post a comment now.

Summary:

What: Major cable operators Comcast and Time Warner intend to offer broadband access to cable programs for the first time, but they have provided few specifics to date, thereby creating a swirl of confusing interpretations. This post seeks to clarify their plans.

Important for whom: Cable networks, other content providers, cable operators, consumers

Potential benefits: Flexible access and first-time online availability of popular cable programs.

Background

Since the WSJ reported two weeks ago today that Comcast and Time Warner Cable plan to offer online access to cable TV programming to their subscribers, there has been a significant amount of confusion and misinterpretation about what these companies are actually planning to do. Absent official statements from either company, there has been an ongoing debate about whether cable operators, who want to defend their traditional model, were moving to choke off the largely open access to broadband video that users have grown accustomed to.

Things got more confusing this past Monday when AdAge ran an interview ("TV Everywhere -- As Long As You Pay For It") with Jeff Bewkes, CEO of Time Warner Inc. in which he elaborated on a company initiative dubbed "TV Everywhere" that major cable network owners such as Time Warner Inc. Viacom, NBCU, Discovery and others are said to be collaborating on. Bewkes outlined a broad online vision including the idea that cable programming could also be available on sites like Hulu, MySpace, Yahoo and YouTube as well, provided that users were paying a fee to some underlying service provider (cable/satellite/telco).

The NYTimes' technology reporter Saul Hansell then picked up on the interview and wrote a piece on the paper's widely-read "Bits" blog entitled "Time Warner Goes Over the Top," which provocatively began, "Just as soon as Time Warner has divested itself from the cable business, Jeff Bewkes, its chief executive, is preparing to stab the cable industry in the back. That's what I read in an interview with Mr. Bewkes in Advertising Age..."

Saul went on to describe his interpretation of one particular Bewkes comment as implying that Time Warner Inc. would offer its networks directly to consumers (or "over the top" of cable operators), thereby setting off a domino effect in which others' networks did the same, all of which would ultimately lead to the destruction of the cable industry business model.

The attention all of this received, particularly in the blogosphere, prompted a fair number of people to contact me and ask what's really going on here.

Time Warner's Plans

Yesterday I spoke with Keith Cocozza, TWI's spokesman, who said that Bewkes's comments do represent both TWI and TWC. Their mutual vision is to have cable programming offered not just at TWC's RoadRunner portal, but also at various third-party aggregators (Hulu, etc.) so long as they subscribe to any multichannel video service (whether from TWC, Verizon, DirectTV, etc.). They do envision offering a streaming-only service for those that don't want the traditional cable subscription, but it would only be available in their geographical footprint. All of that means that there's in fact no over-the-top threat involved here at all. TWI and TWC are "agnostic" about third-party aggregator access to the cable programs, because they recognize that people want to go to whatever sites make them most comfortable. And they do not plan to charge subscribers extra for online access.

From a consumer standpoint, all of this is quite enlightened. But from an operational standpoint, it feels incredibly complex. For example, I asked Keith about how a remote user, seeking to watch programs at a third party aggregator's site like Hulu, would be authenticated as an actual customer of a video service provider? While acknowledging it's too early to have all the answers, he said a test TWC has conducted in Wisconsin with HBO has shown this not to be a big technical problem. I don't agree. It's hard enough for companies to do a bilateral account integration (e.g. tying a user's Amazon account to a user's TiVo account); the idea of doing multilateral account integration (the numerous combinations of potential aggregators and service providers) is fraught with complexity and seems highly daunting.

Then there are financial issues to address. With no incremental subscriber payments, online program delivery needs to be sustained through ads alone. This would be quite workable if it were just cable operators and networks involved (they could split the ad avails proportionately as they've traditionally done with linear delivery), but by allowing third-party aggregators in too, a third mouth now needs to be fed. That will trigger a whole new negotiating dynamic, as each aggregator lobbies for a different share. And it's questionable whether there's even enough ad revenue for three parties to begin with, though Keith believes there is.

Comcast's Plans

Conversely, Kate Noel, Comcast's spokeswoman, told me yesterday that while it's still early to say anything definitive about Comcast's plans for distribution through third-party aggregators, their first priority is distribution of cable programs on their own sites (e.g. Fancast, Comcast.net) and the networks' own sites. Comcast seems to have more of a "walk, before you run" approach. It recognizes that protecting subscribers' privacy in any account integration is crucial so it plans to proceed carefully. I tried to pin Kate down on whether Comcast intends to charge for online access. Again she felt it was too early to be definitive, but it sounds like they're leaning toward a no-charge model as well. The timeline is to begin rolling out access in the 2nd half of '09.

Clearly there are a lot of moving pieces involved with these companies' plans. In general Time Warner has a more aggressive, yet I believe far less pragmatic, plan. They're trying to get all the way to the end zone right away, when just advancing the ball further downfield would be real progress for today's broadband users seeking improved access to premium content. Time Warner's "TV Everywhere" seems like a great vision, but it would take years to fully implement. Comcast's plan is probably achievable in a year or less. Either way, major cable operators finally seem to have the ball rolling toward broadband distribution of cable programming. As I pointed out last week, this can only be viewed as a positive.

What do you think? Post a comment now.

(btw, if you want to learn more about all this, come to the Broadband Video Leadership Evening on March 17th in NYC, where we'll dig deeply into these issues with our top-notch panel)

Here's a question: without checking, who do you think is the largest supplier of videos to YouTube, by a factor of almost 10? If you said Demand Media, which has over 150K individual videos on YouTube that have generated a total of 442 million views to date, you'd be right. Most of the videos are supplied by Demand Media's knowledge-based Expert Village site, and are produced by Demand Studios, the company's content production arm. (For the record, CBS is a distant second supplier to YouTube with almost 16K videos and approximately 327 million total views.)

I learned this and a lot more in a recent and incredibly interesting discussion I had with Steven Kydd, EVP of Demand Studios. In case you've never heard of Demand Media, it's the latest act of former Intermix CEO and MySpace chairman Richard Rosenblatt (who conceived it as a "thinking person's MySpace" as Steven put it). Since its inception in 2006, the company has raised $355 million, made a string of acquisitions and dramatically built up traffic at its portfolio of web sites.

Most interesting for me though, is how Demand Studios has become a veritable "content factory" (my term), churning out 150K individual videos and 350K articles in 2 1/2 years. How it's done that, and better still, how it is monetizing this mountain of content, is the best example I've seen yet of how to effectively build scale at the intersection of social media, search and broadband video.

At the core of Demand Studios is a network of 10,000 freelance content creators that have passed through a rigorous screening process. Specific content is green-lighted through Demand's analysis of internal data. The potential value of a given piece of content is measured by internal algorithms estimating audience interest, advertiser interest and ability to generate traffic.

Once Demand has decided to produce a piece of content its editors tap into specific producers based on a match of their expertise. The producer follows Demand's guidelines, such as shooting exclusively in HD. But in general, the producer has a relatively free creative hand. If for example, the video involves children's nutrition, the producer can call upon a local health expert to appear (which as Steven notes, experts are often happy to do because the videos help raise their own profiles). Once the video is complete, it is edited for quality and has SEO-optimized metadata created and added.

This process is now refined to the point that 1,000 pieces of content are being created per day (30% video, 70% text), with plans to scale even further. Steven said Demand has paid out over $12M to its producers to date. Each producer's content is tracked over time to see how well it performs and is also peer-rated, allowing the cream of the producer network to rise to the top.

Once complete the content is posted on Demand's sites (e.g. Expert Village, eHow, LiveStrong.com, GolfLink, Trails.com, etc.) and in the case of video, on YouTube as well. As Steven notes, since YouTube has now surpassed Yahoo to be the 2nd largest search site, Demand's knowledge-based videos are a perfect fit for how many people increasingly use YouTube.

The two companies have developed a mutually beneficial relationship. YouTube now drives the majority of Demand's video traffic, and Steven says it is being monetized well through AdSense, overlays and companion ads. Conversely, with Demand now generating 2 million YouTube views per day, it has become an important supplier of quality video to YouTube, helping it bolster its value beyond its UGC roots and build its revenues. As well, YouTube has become a testing ground for new Demand sites, such as a Spanish language version of Expert Village.

Syndication beyond YouTube is a key part of Demand's ongoing success. Through its acquisition of Pluck, a white-label social media platform used by many media brands like USAToday.com, NPR, McGraw-Hill and others, Demand now has an opportunity to also syndicate its content to these publishers, who are increasingly resource-constrained and in need of high-quality third-party suppliers. In short, while Demand's "content factory" has already become a major supplier to YouTube, the world's largest video portal, it is now poised to do the same for lots of other sites as well, further growing its traffic.

There's no question that Demand's strict focus on knowledge-based, Long Tail videos has enabled it to create a unique formula that works well at the intersection of social media, search and broadband video. It's doubtful that all of this could be fully replicated in more creative genres like entertainment. Yet there are elements of Demand's content factory, such as leveraging YouTube's audience base, consistently creating high-quality metadata for SEO and applying rigorous criteria to what content gets produced, that are applicable to all video providers. Given Demand's ambitious plans, I suspect their factory will continue to evolve, providing still further lessons for how to create and monetize content in the broadband era.

What do you think? Post a comment now.

(Note: Steven Kydd will be on a panel I'm moderating at the NABShow on Wed, April 22nd, "How Syndication is Powering the Broadband Video Era." VideoNuze readers can register for complimentary access by using code X104)

An article in Friday's WSJ "Cable Firms Look to Offer TV Programs Online" outlined a plan under which Comcast and Time Warner Cable, the nation's 2 largest cable operators, would give just their subscribers online access to cable networks' programming.

A Comcast spokesperson contacted me later Friday morning to explain that the plan, dubbed "OnDemand Online" is indeed in the works, though a release timeline is not yet set. The move is part of the company's "Project Infinity" a wide-ranging on-demand programming vision that was unveiled at CES '08, but oddly has not been messaged much since. Meanwhile, thePlatform, Comcast's broadband video management/publishing subsidiary also called me on Friday to confirm that - unsurprisingly - it would be powering the OnDemand Online initiative (thePlatform's CEO Ian Blaine explains more in this post).

The idea of cable operators setting up online walled gardens for their subscribers alone was first signaled by Peter Stern, Time Warner's EVP/Chief Strategy Officer on the panel I moderated at VideoNuze's Broadband Leadership Breakfast last November. As I wrote subsequently in "The Cable Industry Closes Ranks" my takeaway from his and other cable executives' recent comments was that the industry was poised to collaborate in order to defend cable's traditional - and highly profitable - business model. Under that model, cable operators currently pay somewhere between $20-25 billion per year in monthly "affiliate fees" to programmers whose networks are then packaged by operators into various consumer subscription tiers.

It should come as a surprise to nobody that both cable networks and operators are mightily incented to defend their model against the incursions of free "over the top" distribution alternatives. Indeed what's surprising to me is why it has taken the industry so long to act forcefully when the stakes are so high and the market's moving so fast? I mean cable operators themselves are the largest broadband Internet access providers in the country, and they have watched for years as their networks have been engorged by surging online viewing, courtesy of YouTube, Hulu, Netflix and others. While they've made some tepid moves to push programming online (though to be fair Comcast's Fancast portal has evolved quite a bit recently), overall their broadband video distribution activities have been underwhelming, evidence of broadband distribution's lower priority status vis-a-vis TV-based video-on-demand.

Meanwhile Friday's article triggered plenty of hackles from the blogosphere that those evil cable operators were up to their old monopolistic tricks, this time moving to control the broadband delivery market and choke off open access to premium video. While it's indeed tempting to see these plans that way, I think that would be the wrong conclusion.

Rather, I look at the Comcast/TWC moves as both welcome and likely to spur more, not less, consumer access to broadband-delivered programming. That's because, if the cable networks are smart in their negotiations, they will gain from operators the approval to push more of their programs onto both their own web sites, and even to distribute some through others' sites. With net neutrality agitators hopeful in the wake of Barack Obama's election, Comcast and TWC need to tread carefully in these negotiations. Yet another part of the model I foresee is archived programs, which have been locked up in vaults due to programmers' concerns over operator reprisals if they leaked out online, becoming much more openly accessible.

The Comcast/TWC hecklers need to remember one simple fact: to make quality programming requires solid business models. And in this economic climate, solid business models are far and few between. Despite having lost a total of over 500,000 video subscribers during the last 6 consecutive quarters, Comcast still owns one of those few sold models. And don't forget it is now investing to increase its broadband speeds, pledging 30 million, or 65% of its homes, will have 50 Mbps access by the end of '09 (a rollout which incidentally is all privately financed, without a dime of federal bailout money or other assistance).

Someday, when broadband video business models mature (as indeed they ultimately will), there will be lots of cable and other programming available for free online. For now though, getting Comcast and TWC to finally pursue an aggressive broadband distribution path is a welcome evolutionary step in unlocking this exciting new medium's ultimate potential.

What do you think? Post a comment now.

(Note: we'll be diving deep into this topic, and others, at VideoNuze's Broadband Video Leadership Evening on March 17th in NYC. More information and registration is here.)

Last week when comScore announced data from its Video Metrix service for December '08, I made a note to myself to go back and look at all the video usage data comScore has released and see what it reveals. Below are 5 charts that I've compiled from comScore's press releases covering January 2007 - December 2008 (note comScore didn't report on every single month during this 24 month period so there are some holes in the graphs).

The first graph shows the growth in total videos viewed per month, roughly doubling from 7.2 billion views in Jan. '07 to 14.3 billion views in Dec. '08.

That growth is driven by a number of factors including an increase in the number of monthly viewers from 123 million in Jan. '07 (70% of U.S. Internet users) to 150 million in Dec. '08 (78.5% of U.S. Internet users).

It also reflects an increase in the number of videos viewed per viewer from 59 in Jan. '07 to 96 in Dec. '08.

Which further translates into the growth of total number of minutes the average viewer watched per month from 151 minutes per month in Jan. '07 to 309 minutes per month in Dec. '08.

Recall that Google closed on the YouTube acquisition in Nov. '06 and at $1.65 billion, many thought Google had grossly overpaid. Some may still believe this as YouTube is still very much a work in progress in terms of how it generates revenue. But there's no questioning the phenomenal two-year run it has had in terms of its usage and market share growth. This is one of the reasons why I continue to believe YouTube is one of the most powerful platforms for eventually disrupting the traditional video distribution value chain.

If these slides are hard to view, I've uploaded them all to SlideShare.

What do you think? Post a comment now.

The NY Times reported this week that YouTube is in talks with the William Morris talent agency about a possible deal to have some of its clients create videos especially for YouTube.

Nothing's confirmed at this point and who knows if an actual deal will result. However, if one does it would be a major strategy change for YouTube and I believe would create lots of new issues for the company to deal with. YouTube has always insisted that it is not a content creator; rather its goal has been to be a platform partner for premium video providers seeking to get the most out of the broadband medium.

The company has made significant progress on this front while recognizing that its vast collection of user-generated video will always be valued by its users but will be largely unmonetizable. Still, YouTube has been viewed cautiously by large media companies wary of its reach and disruptive potential. There's still lingering concern about why it took so long to get its Content ID system in place to protect its partners' copyrights (lest we forget the residual of that delay is the Viacom lawsuit that still looms).

From my perspective YouTube risks its credibility with its premium partners if the Morris deal happens. It is going to reopen the debate about what YouTube wants to be when it grows up: distribution partner or content creator. Other questions abound: Will the YouTube-Morris content compete directly with certain premium partners? Will the Morris content receive preferential promotional treatment? And how about the risk that data YouTube keeps about its premium partners' channels could be shared with Morris to help guide its content strategy? The questions go on. YouTube may feel it can finesse these questions and/or that its 40% video market share gives it leeway to push the envelope.

I've long thought that YouTube would find it irresistible to eventually get into the content business itself. The logic flows from precedent. For example, in the cable TV world, TCI was once the largest cable operator. It recognized the enormous financial leverage it enjoyed if it evolved beyond simply being packager of others' channels. As partner in channels in which it owned equity, it guaranteed them distribution, which in turn created viewership, ad and affiliate revenues and big-time value. In fact, TCI's content activities were so successful that it ultimately spawned a whole new company, Liberty Media, to manage its programming investments.

Similarly for YouTube, its access to millions of eyeballs creates a lot of temptation to have its own content properties, all the more so as broadband finds its way to the TV. No doubt YouTube has been pitched on this idea repeatedly over the years. But if it chooses to proceed this time it will no doubt hear concerns raised from its partners. Can it be a neutral, committed distribution partner while it also tries to build up its own content portfolio?

Further, there's the specter of Google and its potent monetization engine backing YouTube's content properties, which could also be viewed as competitive with its partners' ad sales efforts. Put all of this together and the potential Morris deal creates lots of new issues. If it comes to fruition it will be interesting to see how YouTube navigates them.

The answer to that question will start to come early next week when Sling.com, the latest entrant in this already crowded space, officially launches. Recently Jason Hirschhorn, president of Sling Media's entertainment group and Brian Jaquet, Sling's Director of Public Relations came through Boston and caught me up on their plans to launch commercially on Nov. 24th.

Many of you know that Sling is the maker of the Slingbox, which connects to your TV or DVR, allowing you to remotely watch programs on your computer. It's a very clever product, though I have to admit its use case has always been a little confounding to me. Nonetheless, just over a year ago, Sling was acquired by EchoStar in a $380 million deal. Shortly thereafter, EchoStar split itself into two parts, Dish Network, the satellite-delivered programming company, and EchoStar Corporation, which includes Sling and other technology-based businesses.

Sling.com, developed by Jason's entertainment group, is the first Sling offering not tethered to any of its devices and therefore open to all users. Acknowledging that Hulu has set a high bar on user experience, Jason explained that Sling.com is attempting to go one step further on usability, and will also differentiate itself with updated social networking capabilities and highly focused editorial content.

In particular, Sling.com offers a slew of Facebook-like features that allow users to subscribe to and favorite programs and networks, with users in turn able to follow these activities. As Jason aptly put it, the goal is to "digitize the water cooler conversation." The whole experience is geared toward engaging the user at a far deeper level than we're accustomed to in passive linear viewing, or even typical at other aggregators' sites.

The real differentiator for Sling long-term though is the integration of Sling.com with the remote viewing offered by Slingbox. Enabled by a new web-based player (instead of the prior downloadable client), users are able to seamlessly browse back and forth between watching live TV and cataloged programs, as shown below.

Taking this one step further, Sling's goal is to get its remote viewing technology embedded in others' set-top boxes as well. So for example, a Comcast STB with Sling inside would allow you to have live TV integrated into your Sling.com, without having to go buy another box.

That's an enticing prospect, but making it happen will be no small feat; the STB giants like Motorola and SA (now part of Cisco) will get on board only when their biggest customers - America's cable operators - ask for it. The prospect of these cable executives wanting to incorporate any technology controlled by Charlie Ergen, Echo's founder/CEO and the cable industry's arch-enemy, stretches my mind. However, stranger deals have been done, so who knows. In the meantime, there are a whole lot of other non-cable homes globally Sling can address first.

But much of that is down the road anyway. For now, Sling.com is going to compete head on with Hulu (which by my count supplies virtually the entire current movie catalog at Sling.com, in turn begging the question of how many different ways one relatively small ad revenue stream can get carved up?), Fancast, the portal sites, YouTube and so on. Jason readily admits that these sites will not compete on content exclusivity; ultimately they'll all have access to everything that's available.

So in this incredibly crowded space, is there room for a newcomer? On the surface, it's tempting to say "no." But history teaches us that "better mousetraps" can elbow their way into even the most crowded spaces. Remember how many search engines already existed when Google burst onto the scene? On a totally different level, I can relate to this challenge myself. A year ago I wondered whether there was room for a new broadband video-centric blog when so many others already existed; now here we are.

The reality is that newcomers succeed because they don't accept the status quo as final. Rather, they find smart ways of delivering new and better value to customers who didn't necessarily even know what they wanted, but when they got it, were delighted. That's Sling.com's challenge. Whether it can meet it remains to be seen. But in this crummy economy, their deep-pocketed backing certainly gives them a leg up on any VC-funded competitors when it comes to long-term staying power.

What do you think? Post a comment now!

Yesterday I had my own positive broadband video experience, remotely watching portions of the NewTeeVee Live conference held in SF from the comfort of my office. Om Malik and crew put together a packed agenda and I had wanted to go, but a personal conflict kept me in Boston.

I caught most of Netflix CEO Reed Hastings' keynote (until the UStream feed froze up, arghh...) and thought he offered some interesting tidbits about how he sees the broadband video market unfolding. VideoNuze readers know I've been avidly following Netflix's recent moves with Watch Instantly and I've come to think of the company as one of three key aggregators best-positioned to disrupt the cable model (the other two being YouTube and Apple).

Three noteworthy points that Hastings made:

Standards needed to interface broadband to the TV - Hastings catalogued the efforts Netflix is making to integrate with various devices like Roku, LG, TiVo, Xbox, etc, but concluded by saying that these one-off, ad hoc integrations are not scalable and are really slowing the market's evolution. Most of us would agree with this assessment. Still, he was quite pessimistic about a standards setting process's ability to move quickly enough - saying this could be a 10-30 year endeavor. Instead, if I understood him correctly, he thinks the TV approach should just be browser- based, and also that today's remotes should be scrapped in favor of pointer-driven (i.e. mouse-like) navigation.

My opening question to frame the discussion centered on broadband's eventual impact on the cable business model: does it ultimately upend the traditional affiliate fee-driven approach by enabling a raft of "over-the-top" competitors (e.g. Hulu, Netflix, Apple, YouTube, etc.) OR does it complement the model by creating new value and choice? As I said in my initial remarks, I believe that how this question is ultimately resolved will be the key determinant of success for many of the companies involved in today's broadband ecosystem and video industry.

I posed the question first to Peter Stern, who's in the middle of the action as Chief Strategy Officer of Time Warner Cable, the second largest cable company in the U.S. I thought his answer was intriguing: he said that it is cable networks themselves who will determine the sustainability of the model, depending on whether they choose to put their full-length programs online for free or not.

Later in the session, he put a finer point on his argument, saying that "a move to online distribution by cable networks would directly undermine the affiliate fees that are critical to creating great content" and that finding ways to offer these programs only to paying broadband Internet access subscribers was a far better model for today's cable networks and operators to pursue (for more see Todd Spangler's coverage at Multichannel News).

Peter's point echoes my recent "Cord-Cutters" post: to the extent that cable networks - which now attract over 50% of prime-time viewership, and derive a third or more of their total revenues from affiliate fees - withhold their most popular programs from online distribution, they provide a powerful firewall against cord-cutting. Speaking for myself for example, the prospect of missing AMC's "Mad Men" (not available online anywhere, at least not yet...) would be a powerful disincentive for me to yank out my Comcast boxes.

Still, our audience Q&A segment revealed some very basic cracks in the panelists' assertions that the transition to the broadband era can be orderly and managed (not to mention that afterwards, I was privately barraged by skeptical attendees). First and foremost these individuals argued the idea that the cable industry can maintain the value of its subscription service by using the control-oriented approach typified by the traditional windowing process flies in the face of valuable lessons learned by the music industry.

Of course most of us know that sorry story well by now: an assortment of entrenched, head-in-the-sand record labels forcing a margin rich, but speciously valued product (namely the full album or CD) on digitally empowered audiences, who decided to take matters into their own hands by stealing every song they could click their mouses on. Consequently, a white knight savior (Apple) offering a legitimate and consumer-friendly purchase alternative (iPod + iTunes), which would grew to be so popular that it has made the record labels beholden to it, while simultaneously hollowing out the last vestiges of the original album-oriented business model.

Does history repeat itself? Are Peter and the other brightest lights of the cable industry deluding themselves into thinking that a closed, high-margin, windowed platform like cable can ever possibly morph itself into a flexible, must-have service for today's YouTube/Facebook generation?

As Fred succinctly wrapped things up, "The reason I love capitalism is that it forces all of us to keep doing things better and better." To be sure, broadband and digital delivery are unleashing the most powerful capitalistic forces the video industry has yet seen. What impact these forces ultimately have on today's market participants is a question that only time will answer.

What do you think? Post a comment now!

Three numbers in last week's third quarter Comcast earnings release underscored something I've believed for a while: Comcast is a company transformed, now reliant on business drivers that barely existed just ten short years ago. Comcast's transformation from a traditional, plain vanilla cable TV operator to a digital TV and broadband Internet access powerhouse is profound proof of how consumer behaviors' are changing and value is going to be created in the future.

That it doesn't any longer owes to the company's ability to bolster video services revenue and cash flow through ever-higher penetration of digital services into its remaining sub base (at the end of Q3 it stood at 69% or 16.8 million subs). Years after Comcast and other cable operators introduced "digital tiers," stocked with ever-more specialized channels that consumers resisted adopting, the industry has hit upon a winning formula for driving digital boxes into Americans' homes: layering on advanced services like HD, VOD and DVR that are only accessible with digital set top boxes and then bundling them with voice and broadband Internet service into "triple play" packages. Comcast has in effect gone "up-market," targeting consumers willing and able to afford a $100-$200/month bundle in order to enjoy the modern digital lifestyle.

Still, in a sense the new advanced video services represent just the latest in a continuum of improved video services. Far more impressive to me is the broadband growth that both Comcast and other cable operators have experienced. Comcast's approximately 15 million YE '08 broadband subscribers will generate almost $8 billion in annual revenue for Comcast, up dramatically from its modest days as part of @Home 10 years ago. (It's also worth noting the company now also provides phone service to over 6 million homes today vs. zero 10 years ago)

The cable industry as a whole will end 2008 with approximately 37 million broadband subs, again up from single digit millions 10 years ago. And note that the 387,000 net new broadband subs Comcast added in Q3 '08 compares with just 277,000 net broadband subs that the two largest telcos, AT&T and Verizon added in quarter, combined. As someone who was involved in the initial trials of broadband service at Continental Cablevision less than 15 years ago, observing this growth is nothing short of astounding.

While broadband's financial contribution to Comcast is unmistakable, its real impact on the company is more keenly felt in its newfound importance in its customers' lives. Broadband Internet access has become a true utility for many, as essential in many homes as heat, water and electricity. A senior cable equipment executive told me recently that research done by cable companies themselves has shown that in broadband households, broadband service would be considered the last service to get cut back in these tough economic times. In these homes cable TV itself - long thought to be recession-resistant - would get cut ahead of broadband.

Comcast is indeed a company transformed from what it was just 10 years ago. Technology, changing consumer behaviors and a little bit of "being in the right place at the right time" dumb luck have combined to allow Comcast to remake itself. Comcast itself must fully recognize these changes and aggressively build out Fancast and other initiatives to fully capitalize on its newfound opportunities.

What do you think? Post a comment now.

This morning Twentieth Century Fox and Metacafe are announcing "The Thirty Second Film Contest," which challenges contestants to put together a winning thirty second spot for the epic film "Australia," opening on November 26th. Though not yet fully live, I like the direction of this initiative a lot, and believe it provides an innovative example of how to blend traditional film marketing techniques with broadband-enabled audience participation.

Contestants visit the promotional site hosted at Metacafe, a large aggregator of short-form entertainment, to obtain film-related assets provided by Fox. These can be augmented with the contestant's own music, voiceovers, sound effects and artwork to create a highly original entry. Entries are submitted through Metacafe and will be judged by the folks at Fox and Bazmark (Australia director Baz Luhrman's company).

The contest is actually meant to be quite serious and semi-professional; Luhrmann has also created a whole library of videos about film-making, which a student of the art can use to help shape his/her entry, or just watch to learn. The grand prize is enticing: a trip for two to Australia, another to NY for a private screening/meeting with Luhrmann and inclusion of the winning entry on the film's eventual DVD.

The Australia contest builds on a similar one that Metacafe and Universal offered for "The Bourne Ultimatum" last year, which I reviewed enthusiastically here. The concept also follows on previous posts I've done about the value of what I call "purpose-driven user generated video" or "YouTube 2.0" opportunities for users to create videos that have actual business value. I continue to believe that user-submitted videos which go beyond goofball entertainment are a huge area of broadband industry opportunity.

The Australia contest is a winner on multiple levels as it; creates pre-release buzz for the film, allows fans and aspiring artists to get involved and showcase their work, taps into a large base of original (and free!) ideas to help promote the movie, and introduces a fresh, updated approach to film marketing that is sorely needed for differentiation.

This week I've been talking a lot about engagement and why it's so critical in the broadband era. While media and entertainment companies must always focus on driving ratings points or a big opening day box office, the ways to do so are changing. The key change I see is that films, TV programs and other entertainment must become part of a larger experience - complete with multifaceted engagement opportunities - rather than just a one-off moment of audience consumption. Broadband enables this shift in a big way. More marketers need to take advantage of the possibilities.

What do you think? Post a comment now!

EveryZing, a company I wrote about last February, is announcing the launch of its MetaPlayer today and that DallasCowboys.com is the first customer to implement it. My initial take is that MetaPlayer should have strong appeal in the market, and could well shake things up for other broadband technology companies and for content providers. Last week I spoke to EveryZing's CEO Tom Wilde to learn more about the product.

MetaPlayer is interesting for at least three reasons: (1) it drives EveryZing's video search and SEO capabilities inside the videos themselves, (2) it provides deeper engagement opportunities than typically found in other video player environments and (3) it enables content providers to dramatically expand their video catalogs, while maintaining branding and editorial integrity.

To date EveryZing's customers have used its speech-to-text engine to create metadata for their sites' videos, which are then grouped into SEO-friendly "topical pages" that users are directed to when entering terms into the sites' search box. Speech-to-text and other automated metadata generating techniques from companies like Digitalsmiths are becoming increasingly popular as content providers continue to recognize the value of robust metadata.

MetaPlayer takes metadata usage a step further by creating virtual clips based on specified terms, which are exposed to the user. A user's search produces an index of these virtual clips, which can be navigated through time-stamped cue points, transcript review, and thumbnail scenes (see below for example). The virtual clip approach is comparable in some ways to what Gotuit has been doing and is pretty powerful stuff, as it lets the user jump to desired points, thus avoiding wasted viewing time (e.g. just showing the moments when "Tony Romo" is spoken)

Next, MetaPlayer enables deeper engagement with available video. Yesterday, in "Broadband Video Needs to Become More Engaging," I talked about how the importance of engagement to both consumers and content providers. MetaPlayer is a move in this direction as it allows intuitive clipping, sharing and commenting of a specific video clip within MetaPlayer. Example: you can easily send friends just the clips of Romo's touchdown passes along with your comments on each.

Last, and possibly most interesting from a syndication perspective, MetaPlayer allows content providers to dramatically expand their video offerings through the use of what's known as "chromeless" video players. I was first introduced to the chromeless approach by Metacafe's Eyal Hertzog last summer. It basically allows the content provider to maintain elements of the underlying video player, such as its ability to enforce a video's business policies (ad tags, syndication rules, etc.), while allowing new features to be overlayed (customized look-and-feel, consistent player controls, etc.).

MetaPlayer takes advantage of chromeless APIs available now from companies like Brightcove, and also importantly YouTube. For example, the Cowboys could harvest select Cowboys-related YouTube videos and incorporate them into their site (this is similar to what Magnify.net also enables). With the chromeless approach, the Cowboys's user experience and their video player's branding is maintained while YouTube's rules, such as no pre-roll ads are also enforced.

To the extent that chromeless APIs become more widely available, it means that syndication can really flourish. The underlying content provider's model is protected while simultaneously enabling widespread distribution. All of this obviously leads to more monetization opportunities through highly targeted ads.

Bottom line: EveryZing's new MetaPlayer addresses at least three real hot buttons of the broadband video landscape: improved navigation, enhanced engagement and expanding content selection/monetization. All of this should give MetaPlayer strong appeal in the market.

What do you think? Post a comment now!

In the two years since Google acquired YouTube, I've often wondered about two things: (1) was there really a strategic rationale behind the deal? and, (2) if there was indeed a strategic rationale, when might we see it borne out in actual business initiatives?

For sure YouTube's organic growth has continued unabated during these two years and from a traffic perspective, it is more dominant now than ever. Yet the dearth of initiatives that are tangibly strategic (or meaningfully revenue-producing for that matter) to Google, or that even minimally strengthen either company's underlying value proposition, has led me to conclude that the deal had more to do with the Google guys wanting to acquire YouTube for its "coolness" factor - simply because they could - than anything else.

I don't mean to sound unfair to the YouTubers who work diligently to make YouTube an incredible experience, which of course it truly is. Yet it is hard to deny the obvious: exactly what has YouTube done differently during the last two years that it couldn't have done had it remained independent (and saying "afforded its monthly CDN bills" doesn't count!), and how exactly have either YouTube or Google benefited from being together during this time?

However, I think things are finally changing. In fact, with little fanfare or proactive PR, Google at last seems to be strategically flexing YouTube's muscles. While some of what they're doing is experimental, other moves have significant market potential and could be highly disruptive to other broadband oriented media and technology companies.

At the top of my "highest potential" list is Google Content Network, especially as it's envisioned as "spokes" tied to YouTube's "hub." I wrote at length about GCN a month ago in "Google Content Network Has Lots of Potential, Implications" so I won't rehash my arguments here. But note yesterday's news about "Poptub" as the second video series to get the GCN/YouTube treatment; I expect a steady drumbeat of these types of deals in the months to come. GCN has the potential to become a key driver of the Syndicated Video Economy.

Another high-potential activity is YouTube's plan to start streaming full episodes. The first deal with CBS is no doubt a signal of many more to come. Full episode streaming is strategic on a number of levels. It enhances YouTube's and Google's access to big brands' ad dollars. While Google has thrived in the self-service, "long tail of advertising" world, it needs more cred among big brands, especially as it pursues its Google TV initiative (see latest deal with NBCU) and other eventual broadband-to-the-TV activities. Full episodes are also a winner from a user standpoint: a unified video experience across premium, indie, long tail and UGC video is very compelling and also squeezes competitors with narrower offerings.

Yet another high-potential activity is the implementation of search ads on YouTube. When the deal was originally done, my first reaction was to think it was a no-brainer to simply start displaying ads against every YouTube search (example - you search for "West Wing" in YouTube and the results page shows an ad to buy the DVD set). If there's one thing Google knows cold, it's the search ad business. YouTube searches represent billions of incremental opportunities each year to extend its core franchise.

Lastly - and this is admittedly more of a "Will Richmond thing" than anything Google or YouTube are yet pursuing: I think it's practically inevitable that the company will start investing in independent broadband video companies at some point. I touched on this in yesterday's piece about NBCU-60Frames and MSN-Stage 9. As time marches on and some of the above activities bear fruit, it's going to become very tempting for Google/YouTube to lever its strengths more directly into content ownership. I know what Google's always maintained about being a technology company, committed to neutrality in way that even Switzerland would appreciate. But as Google's ad business matures and it inevitably is pressured for growth, content is going to be a very alluring opportunity.

Regardless of what happens on this last point, YouTube now seems to have a full plate of strategic activities underway. It's great to finally see this happening.

What do you think? Post a comment now.

In case you missed the news, last Tuesday, NBCU and 60Frames, an independent broadband-only studio I've written about, announced a comprehensive content development and ad sales deal. Critically, NBCU will take original broadband-only shows from 60Frames to brands/agencies with which it has relationships to pursue both upfront sponsorships and possible brand integration.

Then this past Monday, Disney and Microsoft announced at MIPCOM that Stage 9, Disney's in-house broadband-only studio which I've also written about, would begin syndicating its shows to MSN Video for European viewers. While smaller in scope, the Disney-MS deal is no less noteworthy.

I see at least three underlying threads to these deals that suggest broader market implications. First, the deals are further evidence that the broadband-only video model is still nascent and in need of market validation and financial support. If these deals are in fact harbingers, this support will come from established players like NBCU and Microsoft who have significant reach and access to ad dollars. Somewhat ironically these are also companies that have financial stakes (either through direct ownership of or important customer/strategic relationships with) the very incumbent media properties that the broadband-only crowd is trying to grab eyeballs away from.

Second, the down economy is a catalyst for more of these types of deals. Last week, in "5 Conclusions About the Bad Economy's Effect on Broadband Video," I asserted that the broadband-only studios would tighten their belts a bit to conserve resources in this uncertain climate. One way to mitigate their financial risk and uncertainty is through these linkups with deep pocketed partners. NBCU's backing of the 60Frames slate appears to be the most extensive of these types of deals to date. That Stage 9 - owned by well-funded Disney - is also hunting down big distribution partners which have brand relationships is still further evidence that risk mitigation is a key priority.

Third, the deals point to an acceleration of the trend toward broadband video syndication. In a presentation I give periodically to industry executives, I have a slide titled "Syndicated Video Economy Accelerates" which lists the reasons as: (1) Ongoing video explosion causes heightened need to break through to audiences, (2) Device proliferation causes even more audience fragmentation, (3) Ad model firms up, improving ROI for free, widely distributed video and (4) Social media use means surging user-driven syndication. That slide needs to be updated for a new #1 reason motivating syndication: "In a down economy, syndication could mean the difference between success and failure for broadband-only studios and even big media backed broadband initiatives."

Here's something else to consider: what role might YouTube, the market's undisputed 800 pound gorilla, play as an emerging distributor and financial backer of broadband-only video? Despite its much-avowed disinterest in being a content provider, YouTube, with Google's abundant balance sheet, is in a Warren Buffet-like position to become the go-to resource for financial backing and key distribution. (Readers who are cable industry veterans will also see a potential parallel to the M.O. of TCI back in the 1980's and 90's.) Couple Google's billions with YouTube's massive reach, desire to move up the quality ladder from its UGC roots, pursuit of new ad models and commerce models and its budding GCN initiative, and the company really is superbly positioned to play a role in the development of broadband-only programming.

With so much going on in the broadband video world, I rarely get an opportunity to follow up on previously discussed items. So today, an attempt to catch up on some news that's worth paying attention to:

Brightcove 3 is released - Back in June I wrote about the beta release of Brightcove 3, the company's updated video platform. Today Brightcove is officially releasing the product. I got another good look at it a couple weeks ago in a briefing with Adam Berrey, Brightcove's SVP of Marketing. I like what I saw. Much more intuitive publishing/workflow. Improved ability to mix and match video and non-video assets in the way content is actually consumed. New emphasis on high-quality delivery to keep up with ever-escalating quality bar. Flexibility around video player design and implementation. And so on.

The broadband video publishing/management platform is incredibly crowded, and only getting more competitive. Brightcove 3 ups the ante further.

Silverlight 2 is released - Speaking of releases, Microsoft officially unveiled Silverlight 2 yesterday, making it available for download today. I was on a call yesterday with Scott Guthrie, corporate VP of the .NET developer Division, who elaborated on the details. NBC's recent Olympics was Silverlight 2 beta's big public event, and as I wrote in August, the user experience was seamless and offered up exciting new features (PIP, concurrent live streams, zero-buffer rewinds, etc.).

A pitched battle between Microsoft and Adobe is underway for the hearts and minds of developers, content providers and consumers. Silverlight has a lot of catching up to do, but as is evident from the release, it intends to devote a lot of resources. Can you say Netscape-IE or Real-WMP? This will be a battle worth watching.

Google and Seth MacFarlane are hitting a home run with "Cavalcade of Comedy" - A month since its debut, Google/YouTube and Seth MacFarlane seem to have hit on a winning formula at the intersection of video syndication, audience growth and brand sponsorship. On YouTube alone, the 10 short episodes have generated over 12.7 million views according to my calculations, while this TV Week piece quotes 14 million + when all views are tallied.

Last month, in "Google Content Network Has Lots of Potential, Implications" I wrote at length about how powerful GCN and YouTube could be for the budding Syndicated Video Economy, yet noted that the jury is still out on whether Google's really committed to GCN. "Cavalcade's" early success surely gives GCN some tailwind. (Btw, for more on Google/YouTube's myriad video initiatives, join me on Nov. 10th for the Broadband Video Leadership Breakfast Panel, which David Eun, the company's VP of Content Partnerships will be a panelist)

NBC/SNL and Tina Fey set a new standard for viral success - Tina Fey's Sarah Palin skits are hilarious and unlike anything yet seen in viral video. Usage is through the roof: a new study by IMMI suggests that twice as many people watched the skits online and on DVR than did on-air, while Visible Measures's data (as of 3 weeks ago!), shows over 11 million video views. SNL is smack in the middle of the cultural zeitgeist once again, with Thursday night specials and reports of a new dedicated web site in the mix.

To put in perspective how disruptive viral video can be to the uninitiated, several weeks ago I heard a pundit on CNN's AC360 dismiss the potential impact of the Fey skits on the election with a wave of his hand and a remark to the effect of "come on, how many people stay up that late to watch SNL really?" How's that for being out of touch with the way today's world really works? Political pros and other taste-makers should take heed - viral video can be a cultural tour de force.

Joost Flash version is here, finally - Remember Joost? Originally the super-secret "Venice Project" from the team that made a killing on KaZaA and Skype (the latter of which was acquired by eBay, permanently undermining former eBay CEO Meg Whitman's M&A acumen), Joost today is announcing its Flash-based video service. You might ask what took the company so long given this is where the market's been for several years already? I have no idea.

But here's one key takeaway from Joost's story: because of its lineage, the company was once regaled as the "it" player of the broadband video landscape. Conversely, Hulu, because of its big media NBC and Fox parentage, was dismissed by many right from the start. Now look at how their fortunes have turned. When your mom used to tell you "don't judge a book by its cover," she was right.

What do you think? Post a comment.