VideoNuze Posts

The Olympic Games continue to be a prime area of broadband video innovation. Following on the heels of the groundbreaking Broadband Olympics from Beijing last summer, yesterday brought news from Canada's Olympic Broadcast Media Consortium (which holds the Canadian rights to the 2010 Vancouver Games) of even more extensive broadband Olympic coverage at CTVOlympics.ca and RDSOlympiques.ca.

Alon Marcovici, the VP of Digital Media and Research for the consortium told me yesterday that the every single moment of Olympic competition will be streamed live, so that if you have a broadband connection, you won't miss a moment of the action. I had Alon on a panel I moderated last year at the NAB Show, and his description then of what's involved with this unprecedented coverage was pretty incredible to hear. Broadband has created a whole new workflow, often relying on newer technologies that have not been tested at this scale. It's a bit of a high-wire act, but when it all comes together the payoff for consumers is significant.

For the Vancouver games, the consortium will provide 2,400 hours of online coverage, including a quad-screen mosaic option that will allow the viewer to watch 4 live streams concurrently. Because of the cross-media ownership in Canada, there will be lots of integration with newspaper and radio coverage, as well as bi-lingual (English and French) streams. There's also going to be a real emphasis on user-generated content, such as "Call the Game," a contest where users can overlay their own audio on historic Olympic moments, with entries voted on by other users.

No doubt we'll be hearing more from NBC, which again holds the U.S. rights, about their extensive use of broadband again. Add it all up and the Vancouver Games promise to be another seminal moment in broadband's evolution.

What do you think? Post a comment now.

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.

What do you think? Post a comment now.

A reminder that early bird discounts are available for another 2 weeks for VideoNuze's next event, the Broadband Video Leadership Evening on Tuesday, March 17th in New York City. The evening will start with a "VideoSchmooze" cocktail/networking reception from 6pm - 7:30pm, followed by a panel discussion I'll moderate from 7:30pm - 9pm titled, "Broadband Video '09: Building the Road to Profitability." We have an all-star panel including:

• Albert Cheng, EVP, Digital Media, Disney/ABC Television Group
• Greg Clayman, EVP, Digital Distribution & Business Development, MTV Networks
• Karin Gilford, SVP, Fancast and Online Entertainment, Comcast Interactive Media
• Curt Hecht, President, VivaKi (Publicis Groupe)
• Tom Morgan, Chief Strategy Officer, Move Networks

Click here to learn more and register for the early bird discount

The event will be held at the Hudson Theater, a beautifully-renovated venue on West 44th Street just off Times Square. I'm pleased to have NATPE, VideoNuze's partner since launch, on board for the event. And I'm extremely grateful to lead sponsor Move Networks and supporting sponsors ExtendMedia, mPoint and PermissionTV who are making the evening possible. Note, additional sponsorship opportunities are still available, contact me to learn more.

I've set up a Facebook group so you can start meeting other attendees and also keep up to date on all the recent broadband news we'll discuss on the panel. Friend me on Facebook and you can join!

Note this event is on the evening before the start of the McGraw-Hill Media Summit in NYC; if you're coming in for that, plan accordingly to join us as well!

Click here to learn more and register for the early bird discount

Below is the 5th edition of the VideoNuze Report podcast, for Feb. 6, 2009. Once again, Daisy Whitney and I are talking about posts we've made recently. This week Daisy discusses her post about Facebook and Ashton Kutcher linking up to launch "Katalyst HQ." I provide some additional background on the Super Bowl ads which had a broadband video component based on data I shared in this post: "Super Bowl Ads are a Broadband Fumble Again."

Click here for previous podcasts

WHAT TYPE OF ONLINE ADS DO YOU BUY?

We buy pre-rolls, mid-rolls, in-line video ads. The only thing we have not bought much of are ads around user-generated content.

WHO ARE SOME OF YOUR CLIENTS?

Sears, K-Mart, Fidelity Investments, Amtrak, Tyson, Choice Hotels, Volvo, Air France, and Reckitt Benckiser, to name a few.

ARE ALL OF YOUR CLIENTS BUYING VIDEO ADS?

Many of our clients are placing ads in online video.

IS IT A "MUST HAVE" ON THE MEDIA PLAN?

We're definitely see it grow in importance and yes, it is a "must have" on some media plans. What I can say with more certainty is that online video advertising is becoming, and for some clients is, as important as display advertising. What remains a more consistent "must have" are search buys.

WHAT ARE THE SIZES OF SOME OF YOUR BUYS? WHAT ARE THE CPM TRENDS?

A buyer considers two things: scale (will it reach enough people) and the size/cost of a buy. It depends on the overall size of the campaign. For instance, in a large campaign a buy is south of $50K, may not make the plan, unless we're going to do it for the intelligence of the buy or because the CPM is very discounted. On a smaller campaign $50K might be the entire campaign so you will see much smaller video purchases. There is a huge swing for CPM range depending on the content. Everything hinges on the content. We see CPMs ranging from $15-$40 for non-UGV content in-stream units. UGV, the lower-end quality content CPMs tend to be in the single digits. In-banner video is generally on the lower end of the single digit range.

HOW LABOR INTENSIVE IS AN ONLINE VIDEO AD BUY?

Relatively speaking, it is a lot more labor intensive than a broadcast buy. In the online world, there are a lot of steps in the process to create, buy, optimize, build and analyze a video ad campaign.

WHAT DO YOU WANT YOUR SELLERS TO KNOW BEFORE THEY COME AND PITCH YOU?

I'd like sellers to be informed about our clients, their campaigns, and goals so we can build the best possible idea. I want someone to bring me a solution, not just sell me their unsold inventory.

IS THE "BUY" ALL ABOUT SCALE?

I think it's about audience fragmentation, the inverse of scale. People buy TV because they can aggregate a large audience; it is the best mass media vehicle. As TV ratings decline, a buyer has to buy an increased mix of television to achieve the same scale they did previously. Now the consideration shouldn't just be TV, it should be all video.

WHO DOES THE BUYING? BROADCAST BUYER? ONLINE BUYER?

Both online buyers and broadcast buyers do the buying but like anything, it depends on the buy. Pure online purchases (like Hulu, Veoh, YouTube), the online buyers are in the lead. On the network side (such as buying from ABC), it's a little bit different because there are instances where media is bought by network buyers with the assistance of online buyers.

WOULD YOU BUY FROM AN INDEPENDENT WEB STUDIO OR THEIR CONTENT?

I would consider such a buy but it goes back to the issue of scale. Would we buy directly from the programmer or buy from a network? In a world where I'm trying to aggregate reach, they may fall out of the category due to their limited audience size.

QUOTE

"We're bullish on online video, the performance we've seen from it is highly encouraging."

For Internet-based content, recommendations have to be one of the toughest nuts to crack. There are just so many variables in play - analyzing and characterizing the initial piece of content consumed, building a large enough database of content to match it against, understanding individual user's peculiarities, presenting results in a meaningful way, etc. Still, effective recommendations are powerful because they enhance the user's experience, increase consumption and drive more ad inventory.

One company trying to crack the recommendations nut for video content is Israel-based Taboola. I recently caught up with their CEO/founder Adam Singolda to learn more about their approach and progress. The company's ViDiscovery system analyzes both the content provider's video and its users' behaviors. The combination of the two then drives Taboola's recommendations, which can be presented in a number of different formats depending on the content provider's preferences.

You can see several examples of the recommendations in action. At CNN.com, a little tab in the bottom left of the video window prompts for "Videos Like This" which in turn opens a horizontal scroll bar with recommended videos. In some cases the recommendation work very well, matching specific news stories with one another. But in other cases the experience was mixed. For example, when watching a video about the "Zooz Beat" music app the first recommended video was an update about Hurricane Gustav from August '08 and the second was about a refinery workers' strike in the U.K. Hmm, if there's a correlation between the three videos, I'm not sure I see it.

Still, Taboola's team has an impressive pedigree and has raised $6M to date, plenty for a small team to continue refining its algorithms and results. The company's primary model is ad-based, with it receiving a revenue share for incremental video viewing that it drives. That kind of success-based approach will endear it to resource-constrained content providers eager to generate additional usage and revenues without extra expense. It's easy to implement Taboola by just adding a line of code to the player or web site.

High-quality recommendations are not easy to pull off, but if Taboola can get its system really humming with demonstrable case studies of success it could gain very quick traction.

What do you think? Post a comment now.

By any measure this is an impressive start. For perspective, this may well be the largest number of people who have connected broadband to their TVs using an external device. More have probably connected their computers directly to their TVs, but as for devices I can't imagine any other having close to a million (Apple TV? Vudu? Roku?). In addition, simple math suggests that these users would already be watching the equivalent of around 1 movie or so per week (1.5 billion minutes divided by 1 million Xbox users divided by 12 weeks = 125 minutes viewed per user per week). Obviously this is just an average and also doesn't account for the ramp up in users over the 3 months. I think consumption will steadily increase especially if Netflix can expand WI's library of 12K titles.

Xbox must represent the largest footprint of Netflix-connected devices, simply because the number of Xbox LIVE Gold members is far larger than the number of owners of TiVo or the Blu-ray players that connect to Netflix. The Xbox adoption rate underscores the validity of Netflix's approach to make WI a value add for its subscribers and to integrate with third-party devices.

VideoNuze readers know I've become extremely enthusiastic about Netflix's broadband activities. The Xbox numbers are a positive early indicator of success. I only see more good news coming down the road.

What do you think? Post a comment now.

The Super Bowl ads are continuing to generate all kinds of buzz and continued chatter. In the spirit of "everything's been said, but not by everyone," here are a few additional broadband-related thoughts.

Doritos user-generated contest is a big winner - Doritos snagged 2 of the top 5 placements in the USA Today Ad Meter popularity rankings, displacing Anheuser-Busch for the first time. The fact that the Herbert brothers of Indiana could have created an ad more popular than all of those by the pros is impressive enough. More interesting though to me is Doritos is steadily morphing its brand into one which its customers control. This was the 3rd time Doritos handed over its Super Bowl advertising to fans to both submit ads and also vote on them. I've written about other brands' UGV contests, but Doritos is clearly the furthest along in embracing this concept. It's a great differentiator for the brand and will only build further momentum in the future.

The ad development process usually starts with identifying key brand attributes (e.g. "convenient," "affordable," "wide variety," "hip," etc.). Did the Hulu marketing team start with attributes like "deceitful" or "creepy" or "offbeat?" Seemingly so. Although the spot was fun, it didn't do anything to articulate Hulu's great value proposition. Further, is Hulu now going to pursue this creepy positioning further? If they do, does that make sense for the brand? But if they don't, wasn't the ad a waste of effort, with little continued momentum? I'm not an ad expert, but I'm not clear on what Hulu was trying to do here, other than get some great yucks.

How about some more "behind-the-scenes" and "making-of" video - Ad executives don't seem to understand what filmmakers discovered with DVDs years ago - that the backstory around the final cut is often even more interesting to fans. Since DVDs offer the capacity to provide director's notes, explanations of special effects, outtakes, actor interviews, etc they often do. This stuff is fascinating. Same with broadband; it offers brands the ability to provide a lot more video than just the ads themselves on their web sites, which some did indeed do.

But many others who could have done so, did not. Two that come right to mind: Coke, whose fascinating ad with insects stealing a sleeping man's bottle had some of the best special effects ever. How about some interviews with the computer animation team that did them? That would be fascinating. The other: E-Trade's talking babies. How'd they do that? Would love to know.

Should ads be rated or filtered? Ok, here's something controversial to think about - should Super Bowl ads be rated or filtered somehow? This is supposed to be family entertainment after all, isn't it? Does the woman getting stripped in the Doritos "Bus" ad or the suggestive GoDaddy girls belong in prime-time? I wonder. Or maybe the online galleries should rate the ads somehow? Maybe the racier ones deserve a parental warning? Just a thought.

Ok, that's it for the '09 Super Bowl, on to other topics...

What do you think? Post a comment now.