VideoNuze Posts

With September's start, the kids heading back to school and overnight lows in the chilly 40s here in the Boston area, it is time to recognize, reluctantly, that this unusually long (and wet!) summer is coming to an end. As many of you, like me, prepare to return to your "regular" routines, I'd like to pause and say a few words of thanks.

First, a huge thanks to VideoNuze's many thousands of readers who give purpose to my daily work. Nearly two years since launching VideoNuze, readership continues to build, with over 9,000 industry participants now receiving the daily VideoNuze email and over 100,000 unique visitors coming to the web site each month. I'm delighted at how VideoNuze has found its place as a trusted source of analysis and news for many in the industry.

This summer has been very productive: 82 analyses comprising almost 50,000 words, 490 industry news items posted to the site from over 25 sources and 11 podcasts with my partner Daisy Whitney. While other sites crank out a far greater quantity than VideoNuze, I'd like to think none offer higher quality. This summer I also managed to squeeze in a couple of consulting projects, 4 speaking engagements, 3 panels I moderated and a 10 day vacation in Israel. Last but not least, VideoNuze's next 2 events coming up in October took shape (registration for the Oct. 13th "VideoSchmooze" NYC event is now live). Whew!

I always welcome readers' emails or calls, whether they're to agree or disagree with what I've written. Though I'm not a hound for compliments, I will admit that I greatly enjoy the emails I receive saying things like, "Thanks for the consistently high quality analysis," "Just wanted to say how useful VideoNuze has been here in the U.K." "Your stuff is consistently enlightening" or "I enjoy your writing and the thoughtfulness your perspective brings to what is typically an over-hyped and under-analyzed topic."

These types of emails help answer some variant of a question I've been asked more than any other in the past two years: "How the hell do you churn this thing out every single day?!" Beyond the pat answer that "every job requires a certain discipline," the real explanation is that for me, VideoNuze is what Malcolm Gladwell, in his superb third book, "Outliers," describes simply as "meaningful work." I love analyzing and writing about the technology and media industries and the change that broadband and mobile are bringing to the video landscape. It's painstaking yet intellectually stimulating to try putting the puzzle pieces together and gratifying to know I have a role in influencing how industry executives determine their strategies and execute their plans.

Second, a huge thanks to VideoNuze's sponsors. From VideoNuze's original 8 charter sponsors, there have now been over 30 companies that have sponsored VideoNuze at one time or another. There isn't room to acknowledge them all, but I encourage you to visit the sponsors' page of the web site and to click through and learn more about each. Beyond the important technology and services each is offering to the industry, many also provide education in the form of free webinars, white papers, etc. As VideoNuze's traffic has grown, the value of sponsoring has as well. I've tried to keep rates reasonable, ensuring a strong ROI along many different metrics (as always, if you're interested in sponsoring VideoNuze, please contact me).

I look forward to continuing to explore broadband and mobile video's future with all of you.

Last Thursday comScore released July 2009 data from its Video Metrix service showing record online video usage for the month. I've been charting comScore's data for 2 1/2 years, making updates each month when comScore provides new data. Today I'm offering these charts as a complimentary download (if you incorporate them into your presentations please identify comScore as the source). Here's an example slide for total online videos viewed per month:

Not surprisingly, a number of content providers have informally told me that their internal data and what comScore reports for them doesn't neatly tie out (anyone who's ever tried to reconcile number from internal analytics, ad servers and external measurement sources can relate to these discrepancies). Nonetheless, comScore's data provides at least one consistently-measured data set on the industry, which is quite useful.

By virtually every measure the industry continues to experience rapid adoption. As I've noted before, in addition to continuing to grow viewership, the industry's key challenge is to further monetize all this video, either through advertising or paid models (subscriptions, pay-per-use or as a value add to other paid services).

What do you think? Post a comment now.

Following are 4 news items worth noting from the week of August 24th:

1. Time Warner Cable, Verizon launch TV Everywhere trials - Little surprise that Time Warner Cable announced its own TV Everywhere trial yesterday, given that former sister company Time Warner has been one of its biggest proponents. More interesting was Verizon launching a TV Everywhere initiative, which I regard as a pretty strong indicator that most or all service providers will eventually get on board. (The Hollywood Reporter has a story that DirecTV is in talks too for online distribution of TBS and TNT to start).

I have to give credit to Time Warner CEO Jeff Bewkes, TV Everwhere's key champion, who's clearly generated a groundswell of support. While some critics see TV Everywhere as being at odds with the "open Internet" ethos, I continue to think of it as a big win for consumers eager to get online access to their favorite cable programs. Assuming authentication is proven in during the trials I expect a speedy rollout.

2. Conde Nast distributes through boxee - I was intrigued by news that Conde Nast Digital will begin distributing video from its Wired.com and Style.com sites through boxee. boxee and others who connect broadband to TVs are valuable for magazines and other content providers who have long been shut out of the cable/satellite/telco distribution ecosystem, thereby unable to reach viewers' TVs. Years ago special interest magazines missed big opportunities to get into cable programming, allowing upstart cable networks to grow into far larger businesses (consider ESPN vs. Sports Illustrated, Food Network vs. Gourmet or CNBC vs. Forbes). Broadband gives magazines, belatedly, an opportunity to get back into the game.

3. Amazon announces 5 finalists in UGC ad contest - Have you seen the 5 finalists' ads in Amazon's "Your Amazon Ad" contest, announced this week? They're quite clever, with some amazing special effects. The contest is another great example of how brands are tapping users' talents, posing new competition to ad agencies. I haven't written about this in a while, but I continue to be impressed with how different brands are pursuing this path. Doritos has been the most visible and successful with its user-generated Super Bowl ads.

4. Microprojectors open up mobile video sharing opportunities - Maybe I've been living under a rock because I just read about "microprojectors" for the first time this week (I have a decent excuse since as I non-iPhone owner I wouldn't have a use for one, yet). As the name suggests, these are pocket-size projectors that allow you to output the video from your iPhone to project onto a large surface like a wall or ceiling. According to this NY Times review the quality is quite respectable, and is no doubt only going to improve. The mind boggles at what this could imply for sharing mobile video. Imagine bringing a kit - consisting of an iPhone, portable speakers and microprojector - to your friend's house, then plugging in and projecting either a live stream or an on-demand program for all to see.

Enjoy your weekend!

Daisy Whitney and I are pleased to present the 29th edition of the VideoNuze Report podcast, for August 28, 2009.

In this week's podcast we discuss comScore's rankings of video ad networks' potential reach for July, 2009. I offered a first look at these rankings in Wednesday's post. As I pointed out, these rankings represent the aggregate reach of each ad network's publisher list. This is different from a ranking of actual reach, which comScore is working on, and plans to begin releasing at some point in the near future. Daisy and I remind listeners that potential reach is an imperfect measure, but it is still an important filter for media buyers trying to gain insight into who the major video networks are.

Unrelated, I touch base on last week's podcast in which Daisy and I discussed the Southeastern Conference's shortsighted ban on fan-generated video in stadiums. I raise the topic because earlier this week I had the pleasure of taking my 9 year-old daughter to Fenway Park to see a Red Sox-White Sox game. All around us were people taking pictures and video. And go to YouTube and you'll find plenty of fan video of key Red Sox moments.

Somehow fan video doesn't seem to bother MLB as it does the SEC. I don't claim to understand the difference in thinking, but Daisy notes that MLB has been among the most forward-looking sports leagues around. Daisy is so peeved at the SEC that she's protesting by vowing never to attend an SEC game (a relatively insignificant threat since she's in fact never attended an SEC game and lives on the other side of the country!)

Click here to listen to the podcast (13 minutes, 53 seconds)

Click here for previous podcasts

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

Below is a first look at comScore's rankings for video ad networks' "potential" reach for July '09. The rankings, which have not yet been publicly shared, reveal a relatively tight clustering of 5 video ad networks - ScanScout, Tremor Media, YuMe, Broadband Enterprises and BrightRoll - with ScanScout capturing the number 1 spot in its first month being fully measured by comScore.

The "potential reach" aspect of these rankings is important to understand. As I explained in June in "Unraveling comScore's Monthly Viewership Data for Online Video Ad Networks," the potential reach numbers account for the aggregate number of viewers of all the sites that the ad network has the right to place ads on. However, as I discussed with Tania Yuki, comScore's director of product management, it's not a perfect measure, though comScore is continually trying to improve it.

The rankings are determined through a combination of the ad networks' self-reported publisher list and comScore's own tracking. If a video network reports that any one publisher accounts for 2% or more of its viewers, comScore requires a letter proving the business relationship. There is also a self-policing mechanism as comScore provides a "dictionary" of all publishers that each ad network reports. Competitors can review the dictionary and appeal to comScore if something appears amiss. Still, there's some looseness in the methodology, and having spoken to a number of industry executives, also a fair amount of concern that it is accurately portraying the industry's true performance.

comScore recognizes the limitations of the potential reach approach and that it is just one way of understanding a video ad network's value. Actual monthly performance is equally important, and comScore has been working with ad networks to implement this reporting as well. As I wrote in June, the "hybrid" approach requires ad networks to insert a 1x1 beacon in their video players. Though this approach also has its limitations, many of the biggest video ad networks are now implementing the beacon, and soon comScore will likely begin reporting actual as well as potential reach.

Video ad networks are a very important part of the online video ecosystem, responsible for placing millions of dollars of ads each month. Importantly they allow a level of targeting and reach that brands seek, but are often unable to attain on their own with a handful of direct site relationships. With the online video medium still relatively new, buyers require data helping them understand their options. However, the comScore data is just a first filter, diligent buyers still must dig in to understand how each network, or individual site meets their needs.

What do you think? Post a comment now.

Inevitably, the explosion of broadband video programming has led to the problem of how to keep viewers' favorites organized and receive updates when new episodes appear. Recognizing this problem and believing it is likely to become even more acute as more mainstream users adopt video and choices continue to grow, Channels.com is launching today, positioning itself as "your web video DVR." Last week, Sean Doherty, Channels.com's CEO and founder gave me an overview.

I've known Sean since our cable days in the mid-'90s, and he's been tweaking Channels for a couple of years, providing me periodic sneak peeks. The best way to think of Channels is analogously: Channels is for video what RSS readers are for text. Sean's insight was that most serialized video is now published with MRSS, RSS 2.0 or iTunes feeds which can be collected and then presented well in a central viewing environment. Channels is like a feed reader that is optimized for video.

Importantly, Channels doesn't touch the source video or the accompanying ads; everything is passed through as is. That means for content providers Channels increases reach and ad inventory without disrupting the experience. Channels also doesn't actually record web shows, making its "DVR" tagline and references to "recording" somewhat misnomers. More accurately Channels is a "network DVR" since it's simply organizing feeds that exist in the cloud. Channels' secret sauce is how it crawls the web searching for feeds that may contain video "enclosures" or files. Those that do are then incorporated into the Channels directory with searchable metadata. Sean reports that Channels now includes 160K+ shows, including 400+ TV shows.

A lot of my time at VideoNuze is spent exploring how broadband's massive penetration has opened up new opportunities for video distribution to consumers. But a recent conversation with Kelly Thompson, COO of iStockphoto served as a reminder that broadband is also beginning to play an important role for professionals seeking stock video footage.

For those not familiar, the "stock" industry refers to photographs, images, audio and video that creators make available for use by others under various license arrangements. Stock assets are often used by creative professionals in lieu of having to create their own because of time and expense limitations.

iStockphoto pioneered a new "microstock" online marketplace which allows stock assets to be downloaded for as little as a dollar apiece. The company has grown rapidly, anticipating $200M in revenues this year delivering over 30M assets, or about 1 every second of every day. iStockphoto splits between 20-40% of each download fee with its contributors depending on terms the contributor has chosen. This year it will pay out over $60M to thousands of contributors. Kelly noted that some contributors' whole income is derived from iStockphoto payments (top contributors can make $300K-400K/year). Getty Images, the largest stock house in the world, bought iStockphoto in 2006 for $50M.

What caught my eye is iStockphoto's move into stock video distribution. Though video has been available for just 3 years, Kelly anticipates it will account for $20M or 10% of revenues in '09. Kelly explained that there's been a massive increase in the need for stock video, as demand for it to be included in PowerPoint presentations, web sites and online campaigns has surged.

Buying stock video at iStockphoto is easy. After setting up an account, you enter keywords or just browse the video catalog. You're presented with thumbnail images, which expand to play the full video when you roll over them. Payments are made using "credits," iStock's currency. Videos are offered in different quality and prices, depending on the user's needs. A lower res video might be around $15 to download while the same in HD quality might be $75.

Kelly explained that widespread broadband access and inexpensive HD cameras that produce amazing video are the key contributors to making iStock's stock video downloads take off. With the market for stock video growing rapidly, competition is heating up from well-funded players like Fotolia and Thought Equity Motion, which specializes in video collections from premium providers like MGM Studios, National Geographic and NBC News.

Still, with broadband's rise, and now mobile video's increasing popularity, the market for stock video seems like it has a lot of growth ahead. Clever companies continue to recognize how broadband creates different types of opportunities to distribute video to various end users.

What do you think? Post a comment now.

Following are 4 news items worth noting from the week of August 17th:

CBS's Smith says authentication is a 5 year rollout - I had a number of people forward me the link to PaidContent's in-depth coverage of CBS Interactive CEO Quincy Smith's comments at the B&C/Multichannel News panel in which he asserted that TV Everywhere/authentication won't gain critical mass until 2014.

I was asked what I thought of that timeline, and my response is that I think Smith is probably in the right ballpark. However, these rollouts will happen on a company by company basis so timing will vary widely. Assuming Comcast's authentication trial works as planned, I think it's likely to expect that Comcast will have its "On Demand Online" version of TV Everywhere rolled out to its full sub base within 12 months or so. Time Warner Cable is likely to be the 2nd most aggressive in pursuing TV Everywhere. For other cable operators, telcos and satellite operators, it will almost certainly be a multi-year exercise.

NFL makes its own broadband moves - While MLB has been getting a lot of press for its recent broadband and mobile initiatives, I was intrigued by 2 NFL-related announcements this week that show the league deepening its interest in broadband distribution. First, as USA Today reported, DirecTV will offer broadband users standalone access to its popular "Sunday Ticket" NFL package. The caveat is that you have to live in an area where satellite coverage is unattainable. The offer, which is being positioned as a trial, runs $349 for the season. With convergence devices like Roku hooking up with MLB.TV, it has to be just a matter of time before the a la carte version of Sunday Ticket comes to TVs via broadband as well.

Following that, yesterday the NFL and NBC announced that for the 2nd season in a row, the full 17 game Sunday night schedule will be streamed live on NBCSports.com and NFL.com. Both will use an HD-quality video player and Microsoft's Silverlight. They will also use Microsoft's Smooth Streaming adaptive bit rate (ABR) technology. All of this should combine to deliver a very high-quality streaming experience. But with all these games available for free online, I have to wonder, are NBC and the NFL leaving money on the table here? It sure seems like there must have been some kind of premium they could have charged, but maybe I'm missing something.

Metacafe grows to 12 million unique viewers in July - More evidence that independent video aggregators are hanging in there, as Metacafe announced uniques were up 67% year-over-year and 10% over June (according to comScore). I've been a Metacafe fan for a while, and their recent redesign around premium "entertainment hubs" has made the site cleaner and far easier to use. Metacafe's news follows last week's announcement by Babelgum that it grew to almost 1.7 million uniques in July since its April launch. Combined, these results show that while the big whales like YouTube and Hulu continue to capture a lot of the headlines, the minnows are still making swimming ahead.

Kodak introduces contest to (re)name its new Zi8 video camera - It's not every day (or any day for that matter) that I get to write how a story in a struggling metro newspaper had the mojo to influence a sexy new consumer electronic product being brought to market by an industrial-era goliath, so I couldn't resist seizing this opportunity.

It turns out that a review Boston Globe columnist Hiawatha Bray wrote, praising Kodak's new Zi8 pocket video camera, but panning its dreadful name, prompted Kodak Chief Marketing Officer Jeffrey Hayzlett to launch an online contest for consumers to submit ideas for a new name for the device, which it intends to be a Flip killer. Good for Hayzlett for his willingness to change course at the last minute, and also try to build some grass roots pre-launch enthusiasm for the product. And good for the Globe for showing it's still relevant. Of course, a new name will not guarantee Kodak success, but it's certainly a good start.

Enjoy your weekend!