VideoNuze Posts

Tremor Video announced earlier today that in June it served 98.3% of its in-stream video ads in players that were 400 pixels or bigger. Tremor has found that the bigger-sized players drive double the engagement rate and also boost completion rates for ads. Based on its own analytics, Tremor found that for ads appearing in 400-500 pixel players, 62% of viewers watched to completion and for ads appearing in a 500-700 pixel player, completion jumped to 75%.

Tremor believes that as player sizes get bigger the viewing experience becomes more TV-like, therefore inducing users to relax and be more prone to sit through ads. Looking ahead, this bodes well for ads on connected TVs, where the content and ads are seen in full screen. Tremor said that it is advising publishing partners to increase the size of their players in order to deliver improved ad performance.

Related, Hulu must also be finding similar results; back in March it increased the size of its video player by 55% to a beefy 900x500.

As exciting as Google Fiber's next-generation, gigabit per second broadband project in Kansas City is, last week's launch details underscore how out of synch its rollout plan is with the realities of typical consumer technology adoption. That's not a big surprise given Google's famously engineering-centric culture. However, it likely means that Google Fiber is going to fall well short of its objectives.

As it stands, Google Fiber is very much a classic early adopter service. It offers a discontinuous benefit of 100 times the average 10 megabit per second speed of incumbent ISPs, appealing to heavy users' appetite for the cutting edge. It is also unproven, therefore requiring early users to be guinea pigs, dealing with first-time installers and plenty of inevitable service bugs.

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I'm pleased to be joined once again by Colin Dixon, senior partner at The Diffusion Group, for the 141st edition of the VideoNuze-TDG Report podcast.

In this week's podcast Colin and I discuss Netflix's underwhelming Q2 '12 results. As I wrote on Wednesday, the company continues to be haunted by its decision a year ago to essentially abandon its DVD-by-mail business. Although in the very long-term, streaming will dominate, Netflix jumped the gun in de-emphasizing what was a lucrative business with substantial entry barriers. DVD subscribers, which are down by 34% in the last 3 quarters were a huge contributor of profits to the company which it could sorely use now as it pursues an expensive - and uncertain - international expansion.

On international, Colin notes that Netflix's performance wasn't that bad, but he still has concerns, particularly in the highly competitive U.K. market. While Netflix seems to have eclipsed LoveFilm there, Colin's sees the new NOW TV service launched by Sky as overwhelming Netflix in marketing and service quality, in turn suppressing subscriber growth there.

Nonetheless, Colin is still reasonably bullish on Netflix in the long-term, figuring that its size and well-known brand will help it get back on track. Absent shorter-term catalysts, I'm not so sure Netflix can return to its glory days. It will be fascinating to watch unfold.

Listen in to learn more.

Click here to listen to the podcast (27 minutes, 33 seconds)

Click here for previous podcasts

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Brightcove reported a solid Q2 '12, its second quarter as a publicly-traded company, with revenues rising 41% year-over-year to $21.6 million and its loss from operations narrowing to $3.9 million vs. $5.1 million in Q2 '11. Brightcove said it now has 4,697 customers of its Video Cloud and App Cloud platforms. For video specifically, during the quarter, Brightcove added 365 "Express" customers (which are $499/month and below) and 78 "Premium" customers, which run into the thousands of dollars/month.

Brightcove also announced its acquisition of Zencoder, a cloud video encoding service that counts 1,000 paying customers, for approximately $30 million. Brightcove views Zencoder as a product augment for its Video Cloud platform and also sees the company's Video.js free HTML video player as a lead generation driver for its Express services.

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There's a major breakthrough in the TV Everywhere landscape to report - Comcast is "auto-verifying" its Xfinity subscribers' access to NBC's online and mobile video streaming of the Summer Olympics. A Comcast spokesperson confirmed that this is the first time TV Everywhere content is being made available to its subscribers without them having to submit their user name and password credentials to gain access.

This is a real milestone as authentication has been widely viewed as a cumbersome process step for subscribers. That's because many people have not created user names and passwords with their pay-TV operator and/or can't remember them. In addition, authentication systems are not yet stable, often requiring repeated log-ins to the same app, and also across different apps (I've had to repeatedly log-in to every TV Everywhere app I've ever used). Exacerbating things, so much online video is freely available that the TV Everywhere login process feels intrusive for users accustomed to immediately being able to watch.

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Adobe announced last evening that the BBC will be using the company's "Project Primetime" video platform to deliver live and VOD streaming coverage of the London Olympics, which start tomorrow evening. The BBC win follows news from 2 weeks ago that Adobe is also powering NBC's ambitious NBC Olympics Live Extra app, which will offer 3,500 hours of video. If all goes well from the NBC and BBC efforts, Project Primetime will gain significant credibility from the Olympics, helping position Adobe as a major player in the intensely competitive online video platform space.

For its Olympics coverage, the BBC is using "Primetime Simulcast" which allows it to live stream events across the web, mobile devices and connected TVs. Specifically, a new HTML5 app has been developed using Adobe PhoneGap, a cross-platform toolset. Video is prepared and delivered by Adobe Media Server for both HTTP Dynamic Streaming (HDS) and HTTP Live Streaming (HLS) adaptive bit rate streaming formats. The video player uses the Open Source Media Framework (OSMF).

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Netflix reported its Q2 '12 results yesterday, and once again DVD subscriber losses in the U.S. were a driving factor in the company's overall performance. While Netflix added over 500K streaming subscribers, the company lost another 850K DVD subscribers. This has become a persistent theme in Netflix's U.S. subscriber dynamics: modest growth in streaming undermined by significant DVD losses.

In fact, as the chart below shows, over the last 3 quarters Netflix's DVD subscribers (standalone and hybrid with streaming) have dropped by 4.7 million, from 13.9 million to 9.2 million. That 34% drop is even more significant if you broaden the period to include estimated churn during Q3 '11 and forecast churn for Q3 '12. Q3 '11 was the quarter in which Qwikster was announced/withdrawn and the DVD/hybrid price increases were instituted. Churn spiked by about 2 million subscribers vs. Q2 '11; it is probably fair to assume that almost all of that was among DVD subs. For Q3 '12, Netflix's mid-point forecast for DVD subs is 8.5 million, a 700K drop from Q2.

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At last month's VideoNuze 2012 Online Video Advertising Summit, our closing session was a big picture debate on the future of online video advertising, featuring AOL's Frank Besteiro, NBCU's Peter Naylor, TiVo's Tara Maitra, TubeMogul's Brett Wilson and YouTube's Suzie Reider, which I moderated.

One of the things the group addresses is whether buyers of online video advertising will prefer an impression-based model (akin to traditional TV advertising) or an engagement-based model (akin to search and other forms of online advertising). I believe it's a key question as it goes to the heart of how video advertising will work and the experience viewers will have online. Within this larger question is the omnipresent issue of measurement - when will there be an accepted currency for online video advertising, and what will it be?

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