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Hurray - Net Neutrality is Dead, For Now
Yesterday's ruling by the D.C. Court of Appeals that the FCC didn't have the authority to cite Comcast for blocking BitTorrent traffic effectively kills "net neutrality," at least for now. That's a good thing and everyone who's interested in seeing continued innovation by broadband ISPs and new video competitors should be cheering the decision. I've been writing about the FCC's unnecessary net neutrality intrusion into the well-functioning ISP market for several years (here, here, here), and it's very encouraging to see this unanimous court decision.
For those not familiar with net neutrality, it would give the FCC the ability to regulate how broadband ISPs manage their networks in order to ensure that
all content is delivered without any bias. Since net neutrality advocates have lacked any sustained pattern of broadband ISP misbehavior to point to as evidence for net neutrality's need, they have instead relied heavily on the argument that pre-emptive regulation is required because ISPs can't be trusted to keep their networks open, and that potential conflicts of interest (many ISPs like Comcast are also big video providers) will inevitably lead ISPs to favor their own services over others.
Concerns about impending, yet hypothetical ISP "fast lanes and slow lanes" have made great soundbites for net neutrality proponents and politicians. And yes, Comcast bungled how it blocked the BitTorrent traffic, and then how it explained itself. There have also been a handful of other ISP infractions. However, if the 70 million plus broadband households were asked to name a single instance where they felt their ISP degraded their access to a certain web site or video service, I am convinced that very few would be able to think of any.
This reflects the fact that broadband ISPs maintain open networks, rightfully policing against illegal behavior or disproportionate use. The ISP business works quite well, and in most parts of America, substantial competition exists between 2 or more providers (with more wireless ones on the way). Further, new video services and devices, which depend on ever-faster, and open broadband networks continue to proliferate, suggesting ample confidence by their backers that robust network access will be available. Consider: did Steve Jobs hesitate to introduce the iPad, which is heavily video-centric, out of fear for network availability? And how about Netflix, ABC, Discovery, MTV and other video providers who quickly introduced apps for the iPad - did they balk due to network concerns? Of course not.
Earlier this week, I calculated that at least $277.4 million was raised by early stage video companies in Q1 '10, bringing the total to at least $570.2 million over the last 4 quarters, despite the worst market circumstances in ages. As I've said many times, investors and entrepreneurs are undeterred though there are no formal net neutrality rules.
It's also important to remember that broadband networks have been built with private capital, in the process creating tens of thousands of well-paying technical and customer service jobs, plus countless other by the content and applications providers who freely ride these broadband pipes each day. And innovation continues, with numerous announcements of 50 and 100 megabit/second services now available. Tinkering with this vibrant sector of the economy with new regulations introduces the risk of unintended consequences.
Rather than presuming that broadband ISP will disrupt their own success formula by arbitrarily blocking supposed competitors, the FCC would be better off staying relentlessly vigilant of ISP behavior. If ISPs do misbehave - thereby offering clear evidence of the need for regulation - the Congress and the FCC should be prepared to act quickly. Until then net neutrality remains a solution in search of a problem, and Washington has plenty of real problems to work on without tackling imaginary ones.
What do you think? Post a comment now (no sign-in required).
Categories: Broadband ISPs, Regulation
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VideoSchmooze is Less Than 3 Weeks Away - Register Now and Win an iPad!
VideoNuze's next "VideoSchmooze" Broadband Video Leadership Evening is coming up on Monday, April 26th - less than 3 weeks from today. The event runs from 6-9pm at the Hudson Theater in New York City and includes open bar, hors d'oeuvres, a full program and a chance to win an iPad.
If you've never been to a VideoSchmooze, it's a premier evening of networking with industry colleagues and learning about what's ahead for the online video industry. The title of the panel discussion at this VideoSchmooze, which I'll moderate, is "Money Talks: Is Online Video Shifting to the Paid Model?" We have an amazing group of executive panelists whose companies are on the front lines of the video revolution:- Jeremy Legg - SVP, Business Development, Turner Broadcasting System, Inc.
- Damon Phillips - Vice President, ESPN3
- Avner Ronen - CEO and Co-founder, boxee
- Fred Santarpia - General Manager, Vevo
Click here to learn more and register for the early bird discount
A bonus of this VideoSchmooze is a 15-minute upfront presentation by Emily Nagle Green, President and CEO of Yankee Group, a leading industry market research and consulting firm. Emily is the author of the recently published book, "Anywhere - How Global Connectivity is Revolutionizing the Way We Do Business." Emily is a veteran researcher who's been studying broadband for 15+ years and previously ran Forrester's North American business. Emily will share key data from Yankee's research and her book, which will set the stage for the panel to follow.
Prior to Emily's presentation, which will start at 7:30pm, we'll have networking, open bar and hors d'oeuvres beginning at 6pm. Past
VideoSchmoozes have attracted 250+ attendees and I expect the same at this one. Whether you're pursuing business or personal opportunities in the industry, VideoSchmooze is a premier opportunity to expand your network and meet the panelists. We'll have a strong mix of established media and technology executives, along with plenty of early stage companies, video producers and investors.
I'm grateful to lead sponsor Akamai Technologies and supporting sponsors FreeWheel, Horn Group, Irdeto, NeuLion, Panvidea and ScanScout for making the evening possible. Once again VideoSchmooze is being held in association with NATPE. You can follow VideoSchmooze on Twitter at hashtag #vidooze
Early bird discounted tickets are now available for $65, which is an incredible value compared to other industry events in NYC. If you're planning to attend with colleagues, more deeply discounted "5-Pack" and "10-Pack" tickets are also available.
And if you need one more incentive to come, I'll pick one lucky attendee's business card from the fishbowl who will win an iPad!
I look forward to seeing you on April 26th!
Click here to learn more and register for the early bird discount
(Note: This Thursday, April 8th, I'll be co-leading a complimentary webinar with TDG's Colin Dixon: "Demystifying Free vs. Paid Online Video," which will be a great warm-up to the VideoSchmooze panel.)
Categories: Events
Topics: VideoSchmooze
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At Least $277.4 Million Was Raised by Global Private Video Companies in Q1 '10
At least $277.4 million was raised by global private video companies in Q1 '10 according to company news releases I received and public sources I track. Of the $277.4 million, $175.4 million was raised by 19 U.S. companies and $102 million by 5 internationally-based companies. The financings ranged in size from $775K for Wistia to $50 million for Qiyi, which is the Chinese search engine Baidu's new online video company. Once again companies across the ecosystem, including content aggregation, chips, advertising, encoding, live streaming and consumer devices were represented.
For the U.S. only, the quarterly total was in the middle of the last 3 quarters, coming in ahead of Q4 '09 ($150.1M) and behind Q3 '09 ($180.9M). Investments in the video space remain very healthy, as the economy gradually recovers from the recession and the opportunity for going public brightens a bit. In the last 4 quarters, U.S. video companies have raised at least $570.2 million.
In addition to private financings, there were a number of video-oriented deals announced in Q1 '10. This list includes the acquisition of Quattro Wireless by Apple for $275 million, Vudu by Walmart for $100 million (rumored), StudioNow by AOL for $36.5 million and Multicast Media by KIT Digital for $18 million. In addition, during the quarter broadband equipment maker Calix went public, raising about $82 million, video ringtone company Vringo filed to go public to raise $64.3 million, independent video producer EQAL bought out its investor Spark Capital and Deluxe bought the assets of MediaRecall. The big negative of Q1 was Veoh's bankruptcy after raising more than $70 million. Looking ahead, Q2 '10 got off to a fast start with Vidyo raising $25 million.
Following are the financings that I tracked during the quarter, the date disclosed and new investors identified if applicable. Links are provided to the companies' press releases, or to relevant media coverage if none could be found (note that I haven't verified media coverage with companies themselves). If I've missed anything or you find an inaccuracy, please post a comment.
U.S.:
Mo-DV ($3.6M) - Jan 5 - Existing investors
Transpera ($2M) - Jan 14 - Existing investors
Beezag ($2.5M) - Jan 24 - Angel investors
Ustream ($20M) - Feb 2 - Softbank (potential eventual investment - $75M)
BrightRoll ($10M) - Feb 3 - Scale Venture Partners, existing investors
IVT ($5.5M) - Feb 9 - Syncom Venture Partners, Barshop Ventures, existing investors
Encoding.com ($1.25M) - Feb 10 - Metamorphic Ventures, angels
Zenverge (Undisclosed) - Feb 10 - Motorola Ventures, existing investors
TidalTV ($16M) - Feb 16 - Comcast Interactive Capital, NEA, Valhalla Partners
YuMe ($25M) - Feb 17 - Menlo Ventures, existing investors
Clicker ($11M) - Feb 18 - JAFCO Ventures, exiting investors
Vook ($2.5M) - Feb 19 - Angel investors
Quantenna ($15M) - Feb 24 - Existing investors
ZillionTV ($10M) - Feb 24 - Qwest
Ubicom ($1.8M) - Mar 8 - Existing investors
SiBEAM ($36.5M) - Mar 9 - Foundation Capital, existing investors
Panvidea ($2M) - Mar 18 - DFJ Gotham Ventures, existing investors
Avaak ($10M) - Mar 22 - Qualcomm, existing investors
Wistia ($775K) - Mar 24 - Angel investors
International:
Siano ($23.5M) - Jan 11 - Existing investors
Guvera ($20M) - Jan 18 - AMMA Private Investment
Voddler ($3.5M) - Feb 8 - Eqvitec Partners
Qiyi/Baidu - ($50M) - Feb 26 - Providence Equity Partners
Videoplaza ($5M) Mar 18 - Creandum, Northzone
Categories: Deals & Financings, International
Topics: Financings
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Revisiting the iPad's Impact on Video
With the iPad available tomorrow, it's worth revisiting the prospects for the device, with respect to video specifically. Two months ago, based on
information provided during the iPad's unveiling, I wrote that while the iPad is ultra-cool, it was unlikely to have a very big impact on the online and mobile video worlds, due to 3 key limitations - high price/narrow gadget appeal, no new video applications and certain key product limitations. In the past 2 months a number of things have happened, so while I'm still doubtful of big iPad success, at least in the short-term, I am somewhat more sanguine about its prospects longer-term.
High price/narrow gadget appeal - Since the unveiling, nothing has changed on the price front, which I continue to believe is the number one factor that will suppress sales. If you want the 3G capable model, you'll be paying approximately $700 including tax, plus $30/month for the AT&T 3G service. Sure, there have been many encouraging reports in the last 2 months that America is emerging from the recession, but the reality is that many people are still watching their expenditures closely. Until Apple cuts the price (and btw, I'm betting on a $150-200 reduction by Christmas), the iPad's high price alone will limit its sales.
Of course price doesn't stand alone; consumers evaluate price in the context of utility and other factors. However, on the utility scale, the iPad's constraint is that it still feels a lot like a gadget. The closest it comes to must-have utility is as an e-book reader, but if that's your main motivation there are many great e-book reader options already available for half or less the iPad's price.
The conversations I've had with those who submitted iPad pre-orders, or intend to buy one in the coming weeks leads me to believe that most early buyers are more eager just to get their hands on one (a gadget motivation if ever there was one) than because they already envision it somehow playing a central role in their lives. While I love gadgets as much as anyone, I just don't think that type of positioning will drive sales in the millions as Apple hopes.
Video availability - In Steve Jobs' demo two months ago he showed video from the NY Times and YouTube, but didn't highlight any new partners or even any new applications. Since then magazines and newspapers have been most enthusiastic in unveiling iPad apps. And in the last 24 hours new apps from Disney/ABC, Discovery, Paramount, Time, NBA, Yahoo and many others have surfaced. One new app of particular note is from Netflix, which hasn't offered an iPhone app to date (I've confirmed that Netflix will issue a press release tomorrow morning at 8am, no doubt officially announcing it). For sure others will be announced tomorrow as well.
It's encouraging to see a content ecosystem around the iPad and the touch screen interaction will create new excitement for these brands. Still, as I asked 2 months ago, will the iPad bring some new type of video, that is more engaging in some way? I think it is possible longer-term (3D on the iPad?), but is unlikely for tomorrow's launch. Jobs is right that iPad viewing will be more intimate. The problem is, try using the iPad on AT&T's overloaded 3G network and excitement will quickly turn to frustration. AT&T is trying hard to keep up, but given iPad users' expectations, disappointment is all but guaranteed when longer-form content from Netflix, ABC or others is accessed.
Product limitations - Cool as the iPad is, when it comes to video, it is missing the most fundamental building block - support for Flash, which is by far the most widely adopted video player. Steve Jobs's disdain for Flash is widely known, and it is forcing partners to reformat their video to work with the iPad. For the deep-pocketed like Disney/ABC and Netflix this isn't so big an issue, but for many others it is. The rise of HTML5, which Apple does support is surely in the iPad's favor, yet its widespread adoption is still a way's off. In the meantime, users who surf to Hulu and other Flash sites on their iPads will be let down. Another issue is battery life. It will be interesting to hear reports from users about how close to spec the iPad's battery performs when watching video continuously.
Despite these concerns, tomorrow will bring a frenzy of activity at Apple stores nationwide which will last for weeks as the first reviews emerge. In addition to the iPad a bevy of additional tablet devices will roll-out this year as well. The whole category will be scrutinized closely to see if consumers have decided there is indeed room in their lives for this new type of device. My sense is that at the right price, people can be convinced. The iPad's price is not there yet, but by fueling early adopter interest, Apple is setting itself up for deeper mass appeal as it brings the price down. If nothing else, with the hysteria we're witnessing around the iPad, Apple has once again proven itself as the world's unparalleled marketer.
What do you think? Post a comment now (no sign-in required).Categories: Mobile Video
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VideoNuze Report Podcast #55 - April 2, 2010
Daisy Whitney and I are pleased to present the 55th edition of the VideoNuze Report podcast, for April 2, 2010.
This week Daisy and I first discuss my post from this past Monday, "New comScore Research Available; More Ads Tolerable in Online TV Programs" (the post also includes a link for a complimentary download of the research presentation). Among other things the research concludes is that viewers of online-delivered TV programs could tolerate 6-7 minutes of ads which is approximately double the typical current ad load.
I have argued for some time that the ad load in online programs is way too light and that it was jeopardizing the broadcast networks' P&Ls, particularly as convergence devices allow online video viewing directly on TVs. Coincidentally, this week the CW Network announced that it would double its ad load next TV season. And Hulu, though announcing this week that it has been profitable for the past 2 quarters, is under continued pressure by its content partners to increase its ad load to generate more revenue (recall that Hulu recently blocked the new Kylo browser, which I asserted was due to concern about cannibalizing audience and ad dollars from on-air).
Daisy then tells us more about "hot-spotting," which is the ability to click on an item in an online video and learn more about it and possibly purchase. Hot-spotting has become very hot (no pun), with multiple companies now offering technology that appears to be yielding significant results. Daisy reports that ConciseClick, ClickThrough and VideoClix are among the leaders and she provides some interesting stats on their performance. Listen in to learn more.
Click here to listen to the podcast (14 minutes, 45 seconds)
Click here for previous podcasts
The VideoNuze Report is available in iTunes...subscribe today!Categories: Advertising, Podcasts
Topics: ClickThrough, comScore, ConciseClick, CW, Hulu, VideoClix
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In Unprecedented Deal, Google and Apple Team Up to Privatize the FCC
VideoNuze has learned that Google and Apple have teamed up to privatize the FCC in a transaction preliminarily valued at $42.5 billion. Though the U.S. government is already widely believed to be controlled by corporate interests, this is the first time that a formal deal to transfer ownership of a government agency has been contemplated. The deal has far-ranging implications for the media and technology industries, not to mention for American democracy. VideoNuze has gained exclusive access to the details.
In an interview last night, Google's CEO Eric Schmidt provided background: "Larry, Sergey and I were recently working on this new algorithm to fix the pickle we've gotten ourselves into in China. The boys are still just so incredulous that this is happening; they keep on saying 'We're Google for chrissakes, we can't let mere countries boss us around!' But then we got to thinking, yikes, what if the U.S. government started treating us this way? That would really suck."
He continued, "And then it just hit us all at the exact same nanosecond (we're so wondrously simpatico that way) - what if, instead of being subject to the regulatory powers-that-be, we owned the regulatory powers-that-be?" But then, Larry's like 'Hmm, I'm not so sure about this guys - even though it would be wicked cool, would the public really let us pull it off?' Now, Larry can be a little bit of a Nervous Nellie, but in this case he had a good point. And then, boom, yet another brilliant idea hit us at the same nanosecond (I know it sounds freakish, but this really does happen with the three of us). We thought, 'What company can we partner with whose brand is walk-on-water loved and can do absolutely no wrong? And we all agreed - it's Apple of course!"
In a follow-up interview, Apple's CEO Steve Jobs added further detail, "I was sitting in my office micro-managing the legal weenies on this HTC lawsuit aimed at gumming up the Nexus One's rollout when my iPhone rings with Eric's caller ID. Ordinarily I wouldn't even answer that back-stabbing, lying sack of you-know-what's call but I wanted to rub his nose in our big legal plans. So I nonchalantly answer the phone, 'What's up dirtbag, looking for some more of Apple's product ideas to steal?' And he's like, 'yeah, whatever, look, here's why I'm calling.' And then he proceeds to tell me about this cockamamie scheme that he and those two Doogie Howser co-founder dorks of his have come up with, to privatize the FCC." Jobs went on:
Categories: Miscellaneous
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Encoding.com Offers Multi-Bit Rate Support to Meet Spec for iPhones/iPads
This morning Encoding.com is announcing support for multi-bit rate encoding and "stream segmenting," to let its customers comply with Apple's HTTP streaming spec for delivering video in iPhone and iPad apps. Last week, Encoding.com's president Jeff Malkin explained to me that several of its customers had reported that video apps they had submitted to Apple for approval in the App Store had been rejected because they didn't offer multiple bit rates. A post last week on TechCrunch provided more background on Apple's requirements.
Encoding.com now offers its customers 3 pre-set encoding rates with additional ones configurable on demand. Subsequent to encoding and splitting the video into multiple segments, Encoding.com packages up the files and
delivers them with XML to the specified CDN for HTTP streaming from standard web servers. The goal of multiple bit rates is to let the video adjust to varying available bandwidth, which in turn helps smooth the user's experience. Jeff reported that CarDomain, the largest auto enthusiast site, is now using Encoding.com's multi-bit rate. CarDomain had seen its app rejected by Apple repeatedly due to "bandwidth usage limitations."
The backdrop here is that with more and more apps incorporating video, when WiFi isn't available, AT&T's 3G network comes under ever-increasing pressure. Just last week I posted on the sub-par experience several iPhone users I've surveyed have been having when trying to access the premium iPhone March Madness app on AT&T's 3G network (though to be fair a few others commented that their access has been ok). I had been surprised that Apple and AT&T felt confident enough in the latter's 3G network to approve this app in the first place, given the likely concurrence of viewing.
AT&T is obviously feeling more confident in its network - or at least in the buffer that Apple is creating by enforcing the multi-bit rate requirement - that more video-intensive apps seem to be passing through the approval process. In addition to the MMOD app, other examples include the new SlingPlayer app, announced last month, and Justin.tv's video app, which was unveiled last week. AT&T is likely trying to be more aggressive with these video apps as news continues to filter out that its iPhone exclusive will expire this year, opening up competition from other carriers.
Mobile video adoption is still well behind online, but the proliferation of mobile devices and apps that support video will no doubt accelerate usage. The next big device catalyst will of course be the iPad, coming this weekend. And as more ecosystem partners like Encoding.com provide the underlying tools to deliver seamless mobile video experiences, even more video-centric apps can be expected.
What do you think? Post a comment now (no sign-in required).Categories: Mobile Video, Technology
Topics: Apple, AT&T, CarDomain, Encoding.com, iPad, iPhone, Justin.tv, MMOD, Sling
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Join Me at VideoNuze's Next "VideoSchmooze" Event: April 26th, NYC
Please join me for VideoNuze's next "VideoSchmooze" Broadband Video Leadership Evening, on Monday evening, April 26th from 6-9pm in New York City.
We have a great panel lined up, which I'll moderate: "Money Talks: Is Online Video Shifting to the Paid Model?" Our group of executive panelists represents multiple perspectives:- Jeremy Legg - SVP, Business Development, Turner Broadcasting System, Inc.
- Damon Phillips - VP, ESPN 360 (soon to be ESPN 3)
- Avner Ronen - CEO and Co-founder, boxee
- Fred Santarpia - General Manager, Vevo
Click here to learn more and register for the early bird discount
With everything that's happening in the online video world, we'll have no shortage of topics to discuss. Monetization and distribution opportunities abound; for example, just in the last couple of weeks on VideoNuze I'vedescribed the new ad formats that blip.tv has recently introduced, the escalating battle for movie rentals between different platforms, the new "Google TV" set-top box and its implications and the premium iPhone MMOD app's performance. Our executive panel will help us understand how these all fit together, and where things are headed in the all-important race to effectively monetize online video. As always, there will be plenty of time for audience Q&A.
I'm also really excited about our featured 15-minute presentation by Emily Nagle Green, President and CEO of Yankee Group, a leading industry market research and consulting firm. Emily is also the author of the recently published book, "Anywhere - How Global Connectivity is Revolutionizing the Way We Do Business." Among other things, Emily previously ran Forrester Research's North American business. She's been studying broadband for 15+ years and some of the key findings from her book are fascinating. Her presentation will be an ideal "stage-setter" for the panel to follow.
The networking period will be upfront, from 6-7:30pm, allowing ample time to mingle and meet industry colleagues. We'll have open bar (and hors d'oeuvres) during this period.
Past VideoSchmoozes have attracted 250+ attendees and I expect the same at this one. Whether you're pursuing business or personal opportunities in the industry, VideoSchmooze is a premier opportunity to expand your network and meet the panelists. As with past events, I expect a strong mix of established media and technology executives, along with plenty of early stage companies, entrepreneurs and investors.
The event will again be held at the gorgeous Hudson Theater, a historic gem on West 44th Street just off Times Square. I'm grateful to lead sponsor Akamai Technologies and supporting sponsors FreeWheel, Horn Group, Irdeto, NeuLion, Panvidea and ScanScout for making the evening possible. Once again VideoSchmooze is being held in association with NATPE. You can follow VideoSchmooze on Twitter at hashtag #vidooze
I've tried hard to keep VideoNuze affordable with early bird discounted individual tickets priced at $65. When compared with other events being held in NYC, this is an exceptional value. If you're planning to attend with colleagues, I've also created more deeply discounted "5-Pack" and "10-Pack" tickets. I hope to see you on April 26th!
Click here to learn more and register for the early bird discount
(Note: Yesterday, some of you received 2 versions of the VideoNuze email. My apologies for that, it was my error.)Categories: Events
Topics: VideoSchmooze
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