Posts for 'HowCast'

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Last week I got a heads-up on milestones that Howcast, a player in the how-to video market, has recently achieved, from Sanjay Raman, Chief Product Officer and co-founder. Howcast is now doing about 25 million playbacks per month, with about 20% of those happening on Howcast.com and 80% through its partners such as Yahoo, YouTube, MSN, Hulu, TiVo, FiOS, boxee and others.  Howcast is now producing around 400 videos/month and has over 5,000 videos in its library.

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This week I'll be at Digital Hollywood Fall in LA, the first big industry gathering I've attended since the economic crisis hit. I've been trying to keep my finger on the pulse of what the crisis means for the broadband video industry. Get-togethers like this, with lots of time for informal, off-the-record chats are great for getting a sense of what colleagues think is on the industry's horizon.

Here are 3 interrelated areas I'm most interested in learning about:

Financing

With the credit markets frozen and stock markets tumbling, the availability of financing is topic number one. This is especially relevant for the industry's many earlier stage companies, reliant on private financing from venture capitalists, angels and other private equity investors.

By my count we've seen at least 9 good-sized financings announced since around Labor Day, when the financial markets started coming unglued: Howcast ($2M), blip.tv (undisclosed), Booyah ($4.5M), BlackArrow ($20M), HealthiNation ($7.5M), Adap.tv ($13M), BitTorrent ($17M), Conviva ($20M), and Move Networks (Microsoft, undisclosed). The rumor mill tells me there are at least 2-3 additional financings underway currently. Really smart money (e.g. Warren Buffet) knows that downturns are exactly the time to invest. However, the reality can often be quite different. What's the experience of industry participants trying to raise money these days?

Staffing

In any downturn, the first expense to get cut is people. Headcount reductions are often done quietly, with word later leaking out to the public. Last week brought news of trimming at three indie video providers, Break (11 people), ManiaTV (20) and Heavy (12). More are sure to follow at other companies. As I've written before, the indies are among the most vulnerable in this environment, likely leading many to find bigger partners for both distribution and monetization. But whether layoffs will hit other industry sectors such as platforms, ad networks, CDNs, mobile video and big media is still to be determined by...

Customer spending

Central to the question of how deeply the financial crisis spirals is the interdependence of customer spending at all levels of the economy. Thinking you're safe because you're a B2B company is meaningless if your customers are B2C companies cutting back due to reductions in consumer spending. When consumers tighten their belts that leads to advertisers reducing their spending which leads to media companies scaling back which leads to technology vendors feeling the impact. The reality is we're all in this together.

In fact, the more I read about the economy's fragile condition, the clearer it is that the primary way out is rebuilding confidence and renewed spending at all levels. If a spending paralysis occurs, it could be long road ahead. While there's no reason to believe that consumers are going to slow their consumption of broadband media, the ability to monetize it and innovate around it would be dampened if spending hits a wall.

These are among the topics I'll be looking to discuss at Digital Hollywood this week. If you're attending, drop me a note so we can try to meet up and/or come by the session I'll be moderating on Wednesday at 12:30pm.

What do you think? Post a comment now!

The Internet's low entry barriers are again at work, this time in the video-based "how-to" category, which has recently attracted a rush of well-funded new competitors. It's no surprise: how many of us would rather watch a video of someone explaining how to do something vs. reading a lengthy and often poorly-written guide?

Like many things in the broadband video world, the players' strategies, content approaches and business models are all over the board. In the ad-supported category, the earliest entrants (and their funding) are ExpertVillage (now owned by Demand Media) and VideoJug ($30M from last May), with HowCast ($8M from Tudor/others), 5Min.com ($5M from Spark Capital) and WonderHowTo.com (undisclosed amount from General Catalyst) launching more recently. Of course there's also YouTube and DIYNetwork from Scripps, with its sister cable channel, and scores of other sites that offer free instructional video. Then in the paid download category there is Zipidee (angel round), which recently acquired TotalVid and iAmplify ($6M from Kodiak). plus countless other video download sites.

One of the lines of demarcation for the ad-supported sites is how they acquire content. Does the video come solely from "experts" or also from the community? For now, it appears that ExpertVillage and VideoJug rely on experts while the other ad-supported upstarts rely on the community as well. I spoke with Ran Harnevo, CEO of 5Min.com, who believes its highly community-oriented focus is a real differentiator. In fact, 5Min bills itself as a "Life Videopedia", a spin on the hugely popular Wikipedia, which demonstrates the power of user contributions.

The whole notion that a top-down editorially-driven approach will ever be sufficiently comprehensive seems unlikely, so my guess is that some UGC augment eventually will be required by all players. That means these sites will compete with each other for the best contributors, in the same way that video sharing sites like Metacafe, Veoh, Revver and others compete with each other in general video.

To succeed in this horse race, 5Min's focus is to offer the best overall platform, including a focus on technology. So 5Min provides strong branding opportunities, a revenue share, tools and features and of course, traffic. On the technology side, one differentiator is its "SmartPlayer", which allows zooming, super slow-motion, frame-by-frame and storyboard playback.

One of the main reasons there's so much activity on the ad-supported side is that how-to videos provide highly-targeted and engaged audiences that sponsors crave. At a minimum, marrying these how-to videos to Google AdSense provides a baseline revenue model. But the real opportunity is to aggregate enough traffic in a category to land sponsors who will be prominently featured. So for example, while 5Min already does an impressive 5M views/mo, it will likely need to be in that range per category to appeal to big-name sponsors. The company will begin running ads in Q2, and is focused on display ads and overlays, not pre-rolls, which Ran thinks are too disruptive. To build its traffic it will pursue widgetization, 3rd party distribution and SEO.

All of this how-to activity is clearly going to be a boon for users. Just as the Internet has provided an explosion of information, these video how-to sites will now make doing things a whole lot easier. How to break out of the growing pack will continue to be each how-to site's challenge for the foreseeable future.