Brightcove is evolving from helping companies play their videos to helping them make money from those videos; that’s the main theme CEO David Mendels highlighted to me in a briefing yesterday. Brightcove, one of the original online video platform companies, is capitalizing on what David describes as a still highly fragmented video technology landscape that creates a lot of complexity for content providers and marketers.
Key to Brightcove’s plan is helping media companies address the rise of ad-blocking, which is estimated to cost content providers $22 billion in lost revenue in 2015. Last week Brightcove unveiled Brightcove Lift, a new solution that combines its server-side ad insertion and its HTML5 player technology.
David said early results for Brightcove Lift have been encouraging. One U.S. broadcaster implemented it on a millennial-focused digital property where the rate of ad-blocking was high, and saw a 50% revenue uplift. In another example, Vox Media, which had been so frustrated in being able to reliably deliver ads to Android devices that it pulled ads entirely, switched to Brightcove Lift and was able to successfully reinstitute ad-delivery.
Ad delivery is imperative because David believes no media company today can afford to forego even 10% of their revenue to ad-blocking. Further, despite the rush to launch SVOD services, David forecasts that consumers won’t be willing to subscribe to more than a handful of paid services. This will in turn reinforce the value of ad-supported content.
More broadly, David sees Brightcove benefiting from a transition occurring in the market to second generation video solutions that address ever-greater complexities like multi-device delivery and multi-browser DRM. David noted Brightcove’s investments in its HTML5 player, encoding and other core technologies as helping it differentiate from competitors.
These investments seem to be paying off as a key turning point for the company occurred last week with its Q3 ’15 earnings report that saw a return to non-GAAP profitability a quarter ahead of plan. Brightcove earned $1.3 million in Q3 ’15 vs. a loss of $134K in Q3 ’14. David said an important contributor was selling its Video Cloud modularly. This is particularly essential for bigger media companies that have existing workflows and technologies which they want to retain.
Overall, David is bullish on Brightcove’s place in the industry going forward. He said the company is innovating faster than ever to help customers solve business problems, not just technology problems. David sees that as helping Brightcove move up the stack and reposition from a technology-only focus. All the innovation happening in the video industry is great for viewers too, according to David, because they have more choices than ever.