tag:blogger.com,1999:blog-191978352024-03-13T23:26:16.400-07:00Internet Video BlogThis is my blog about a disruptive new technology and business model that I unashamedly evangelize. Together, the technology and business model will change the paradigm of video distribution.Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.comBlogger16125tag:blogger.com,1999:blog-19197835.post-82763014827646175382007-08-15T03:39:00.000-07:002007-08-16T00:41:51.002-07:00Cable TV or IPTV? It’s the Consumer, Stupid!IPTV (as opposed to Internet TV) does not offer the consumer anything more than Cable TV can (and mostly already does). <p class="MsoNormal">If you agreed to what I just said, you don’t need to read any further.<span style=""> </span>You are already clued-in.<span style=""> </span>You are one of the cognoscenti.<span style=""> </span>If you didn’t, sit down, shut up and listen - this may take a while.</p> <p class="MsoNormal" style="margin-top: 12pt;">If you are not sure of the difference between IPTV and Internet TV you can read my previous blogs or read one of these - <a href="http://www.masternewmedia.org/2005/06/04/iptv_vs_internet_television_key.htm">A Seminal article by Robin Good</a>, Also <a href="http://www.streamingmedia.com/article.asp?id=9167">Jeremy Allaire on Brightcove</a> and especially <a href="http://www.masternewmedia.org/news/2005/05/17/internet_television_is_an_open.htm">this one</a>).</p> <p class="MsoNormal">Try a simple experiment with people you know - sell them IPTV service.<span style=""> </span>It can be as complicated or as simple as you like.<span style=""> </span>Explain if necessary what IPTV is about and then ask “Company X is offering this service, would you switch to it?”<span style=""> </span>For Company X you can substitute your local phone company (there is a good chance they are in fact offering IPTV or are shortly planning to).</p> <p class="MsoNormal"><o:p> </o:p></p> <p class="MsoNormal">Of course, we know the outcome of this experiment.<span style=""> </span>Most people will prefer to stay with Cable TV – quite possibly you will not get a single person to “sign up”.<span style=""> </span>If I am completely wrong, please, contact me immediately.<span style=""> </span>I will be happy to post a retraction if appropriate and reexamine everything I have learned in the last ten years about the business of Internet Video.</p> <p class="MsoNormal">Let’s examine why consumers will not want to move to this new technology.<span style=""> </span>Let’s compare what they get.<span style=""> </span>To be fair, we will compare what IPTV will look like in a few years when it has matured.<span style=""> </span>By the same token, Cable TV with their huge investments in fiber will also be a little bit more sophisticated than they are today.<br /><o:p> </o:p></p> <table class="MsoNormalTable" style="border: medium none ; background: rgb(229, 229, 229) none repeat scroll 0% 50%; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial; border-collapse: collapse;" border="1" cellpadding="0" cellspacing="0"> <tbody><tr style=""> <td style="border: 1pt solid navy; padding: 0in 5.4pt; background: navy none repeat scroll 0% 50%; width: 203.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="271"> <p class="MsoNormal"><b><span style="color:white;"><o:p> </o:p></span></b></p><br /></td> <td style="border-style: solid solid solid none; padding: 0in 5.4pt; background: navy none repeat scroll 0% 50%; width: 117pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="156"> <p class="MsoNormal"><b><span style="color:white;">Cable TV</span></b><span style="color:white;"><o:p></o:p></span></p> </td> <td style="border-style: solid solid solid none; padding: 0in 5.4pt; background: navy none repeat scroll 0% 50%; width: 1.7in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="163"> <p class="MsoNormal"><b><span style="color:white;">IPTV<o:p></o:p></span></b></p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 203.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="271"> <p class="MsoNormal"><b> Channels Available </b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 117pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="156"> <p class="MsoNormal">About 200</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.7in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="163"> <p class="MsoNormal">About 200</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 203.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="271"> <p class="MsoNormal"><b>Video-on-demand<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 117pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="156"> <p class="MsoNormal">Yes</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.7in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="163"> <p class="MsoNormal">Yes</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 203.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="271"> <p class="MsoNormal"><b>Time-Shifting<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 117pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="156"> <p class="MsoNormal">Yes</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.7in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="163"> <p class="MsoNormal">Yes</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 203.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="271"> <p class="MsoNormal"><b>Interactivity<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 117pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="156"> <p class="MsoNormal">Yes</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.7in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="163"> <p class="MsoNormal">Yes</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 203.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="271"> <p class="MsoNormal"><b>Smallest Ad Targeting level<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 117pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="156"> <p class="MsoNormal">Neighborhood</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.7in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="163"> <p class="MsoNormal">Neighborhood</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 203.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="271"> <p class="MsoNormal"><b>Serves the Long Tail<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 117pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="156"> <p class="MsoNormal">No</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.7in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="163"> <p class="MsoNormal">No</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 203.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="271"> <p class="MsoNormal"><b>Guaranteed Quality of Service<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 117pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="156"> <p class="MsoNormal">Yes</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.7in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="163"> <p class="MsoNormal">No!</p> </td> </tr> </tbody></table> <p class="MsoNormal"><o:p> </o:p></p> <p class="MsoNormal">Hmm, I don’t see it.<span style=""> </span>Why would anyone switch to IPTV?</p> <p class="MsoNormal"><o:p> </o:p></p> <p class="MsoNormal">But lets look at it another way.<span style=""> </span>Perhaps the consumer will not have a choice because business forces (such as lower costs, easier delivery etc) are driving towards IPTV instead of Cable TV or any other choice in the marketplace today.</p> <p class="MsoNormal"><o:p> </o:p></p> <table class="MsoNormalTable" style="border: medium none ; background: rgb(229, 229, 229) none repeat scroll 0% 50%; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial; border-collapse: collapse;" border="1" cellpadding="0" cellspacing="0"> <tbody><tr style=""> <td style="border: 1pt solid navy; padding: 0in 5.4pt; background: navy none repeat scroll 0% 50%; width: 257.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="343"> <p class="MsoNormal"><b><span style="color:white;"><o:p> </o:p></span></b></p><br /></td> <td style="border-style: solid solid solid none; padding: 0in 5.4pt; background: navy none repeat scroll 0% 50%; width: 99pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="132"> <p class="MsoNormal"><b><span style="color:white;">Cable TV</span></b><span style="color:white;"><o:p></o:p></span></p> </td> <td style="border-style: solid solid solid none; padding: 0in 5.4pt; background: navy none repeat scroll 0% 50%; width: 1.2in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="115"> <p class="MsoNormal"><b><span style="color:white;">IPTV<o:p></o:p></span></b></p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 257.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="343"> <p class="MsoNormal"><b>Requires “Head End” in neighborhood<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 99pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="132"> <p class="MsoNormal">Yes</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.2in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="115"> <p class="MsoNormal">Yes</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 257.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="343"> <p class="MsoNormal"><b>Smallest Ad Targeting level/metrics<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 99pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="132"> <p class="MsoNormal">Neighborhood</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.2in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="115"> <p class="MsoNormal">Neighborhood</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 257.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="343"> <p class="MsoNormal"><b> Content-Owners benefit more</b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 99pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="132"> <p class="MsoNormal">No</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.2in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="115"> <p class="MsoNormal">No</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 257.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="343"> <p class="MsoNormal"><b>Advertisers benefit more<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 99pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="132"> <p class="MsoNormal">No</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.2in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="115"> <p class="MsoNormal">No</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 257.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="343"> <p class="MsoNormal"><b>Network/Plant Costs<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 99pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="132"> <p class="MsoNormal">Same</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.2in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="115"> <p class="MsoNormal">Same</p> </td> </tr> <tr style=""> <td style="border-style: none solid solid; border-color: -moz-use-text-color navy navy; border-width: medium 1pt 1pt; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 257.4pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="343"> <p class="MsoNormal"><b>Need to buy broadcast rights to content<o:p></o:p></b></p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 99pt; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="132"> <p class="MsoNormal">Yes</p> </td> <td style="border-style: none solid solid none; border-color: -moz-use-text-color navy navy -moz-use-text-color; border-width: medium 1pt 1pt medium; padding: 0in 5.4pt; background: silver none repeat scroll 0% 50%; width: 1.2in; -moz-background-clip: -moz-initial; -moz-background-origin: -moz-initial; -moz-background-inline-policy: -moz-initial;" valign="top" width="115"> <p class="MsoNormal">Yes</p> </td> </tr> </tbody></table> <p class="MsoNormal"><o:p> </o:p></p> <p class="MsoNormal">Not!</p> <p class="MsoNormal"><o:p> </o:p></p> <p class="MsoNormal">The bottom line is this. You cannot make consumers suddenly switch to a new technology (in this case IPTV), when there is not a whole lot of value-add over the old technology (Cable TV).<span style=""> </span>You cannot make them abandon their existing gadgets or even make them add a new gadget for a new technology that offers at best an incremental advantage.</p> <p class="MsoNormal"><o:p> </o:p></p> <p class="MsoNormal">You need a cross-platform strategy and technology i.e. consumers should be able to be use, understand and own the new technology without a huge behavior change and with minimal cost to move over.<span style=""> </span>If you want to push IPTV and you are not doing it on TV (rather than the computer) you are sunk.<span style=""> </span>And, if your model does not add several compelling reasons for people to switch to IPTV from their current Cable or Satellite connection fuggedaboudit.<span style=""> </span>Better still, you need a model like L3 which allows people to keep their Cable TV and start using IPTV or Internet TV until they become comfortable with it.</p><p class="MsoNormal">Or you could keep chasing failing business models like <a href="http://www.webtvwire.com/akimbo-sending-vod-box-to-the-grave/">Akimbo</a> and CinemaNow and MovieLink and so many more....</p><p class="MsoNormal"><br /></p>Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com5tag:blogger.com,1999:blog-19197835.post-73068395076998828072007-05-22T04:53:00.001-07:002007-05-22T05:31:47.273-07:00P2P Streaming and Long Tail: Like Oil on Water...or Misunderstanding the Long Tail<br /><br />Here is another problem I have with P2P streaming. It purportedly delivers long-tail content.<br /><br />I have already discussed how <a href="http://l3media.blogspot.com/2007/05/7-reasons-why-joost-could-fail.html" target="_new">P2P streaming does not work</a>. In fact, it does work, well… kinda, sorta, but it is “the weakest link” among all streaming and all P2P technologies. I believe that means it is destined to end up on the fossil heap thanks to the propensity of the marketplace toward natural selection of better technologies. The 40% extra bandwidth usage required for P2P streaming, and the fact that most connections are asymmetric will kill any chance that P2P streaming will actually work in the marketplace. No ISP will incur 40% additional costs on your behalf even if you are a brilliant billionaire (okay that was a low jab, but appropriate).<br /><br />Let us for the moment assume that Joost manages to circumvent the laws of either Physics or Economics, and manages to make P2P streaming technology work. Let us assume that Joost or Vudu, or their users are able to convince ISPs to change their offering – make connections symmetric and allow P2P on their networks. (Unlikely – even the University of Ohio has <a href="http://www.ohio.edu/students/filesharing.cfm" target="_new"> banned P2P on their campus</a>, despite a lot of criticism – but bear with me). Or that Vudu has some technology (Voodoo?) up their sleeve that will make P2P streaming consume a lot less bandwidth. Again, we would have to rewrite our college Physics books, but really have faith, will you? :-) To be fair, Vudu may use P2P streaming only for quick starting of streams, and not for the entire stream.<br /><br />So, now that we have P2P streaming, let us put some Long Tail content out there to stream. Let us say someone (lets call him Mustafa from San Diego) connects to the Turkish Television Channel on Joost and brings up a Turkish movie. Now, in order to serve this customer in the P2P streaming model, we need peers! Someone, anyone, watching the same movie at about the same time (or within the 2 hours built-in to the buffer)? In an on-demand world? Not too many! Besides Akimbo has cornered the market on Turkish Television! (Sorry, another low jab).<br /><br />OK, lets suspend our belief one more time. Let us say there are a couple of other people watching the exact Long Tail content within plus or minus one hour from Mr. Mustafa. Mr. Taimur (and of course has a “lame” 400kbps connection) is on the same ISP (defying all logic, he lives right next to Mr. Mustafa) but Mr. Ataturk is on a different ISP (it doesn’t matter where he lives). If you look at the diagram below (extremely simplified for all you “non-technical” people) you will see that Mr. Mustafa and Mr. Taimur connect through the same router or DSLAM, or whatever their ISP uses at the POP.<br /><br /><br /><a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://4.bp.blogspot.com/_XNzj7N43P2k/RlLdfKpLSWI/AAAAAAAAAAM/o6ozsOlMBJc/s1600-h/ISPs1.gif"><img style="margin: 0px auto 10px; display: block; text-align: center; cursor: pointer;" src="http://4.bp.blogspot.com/_XNzj7N43P2k/RlLdfKpLSWI/AAAAAAAAAAM/o6ozsOlMBJc/s400/ISPs1.gif" alt="" id="BLOGGER_PHOTO_ID_5067356058247973218" border="0" /></a><br />Unfortunately as you can see, Mr. Ataturk connects to this peer network through the Internet and saves no bandwidth (nor does his ISP). Of course, his ISP is extremely unhappy since all it means is more bandwidth usage. So if you were the ISP, what would you do? I suggest that you have two choices – cap the bandwidth or charge more for it.<br /><br />In other words, the P2P streaming provider has increased the bandwidth (in comparison to straight streaming delivered from a server) and has then shifted the bandwidth off their network on to that of the users’ ISPs. If you ran an ISP, would you put up with it?<br /><br />Actually the news is even worse. Most Telco based ISPs use DSLAMs, and the traffic shaping is usually done on the DSLAM itself. So even though they are on the same ISP, Mr. Mustafa and Mr. Taimur, probably would not be able to do much for each other in P2P streaming.<br /><br />We have not even talked about the QOS (Quality of Service) issues of Streaming Video which of course apply to P2P Streaming Video. <a href="http://l3media.blogspot.com/2006/05/why-streaming-video-is-wrong-for-iptv.html" target="_new">I have argued</a> ad nauseum that Streaming quality cannot be guaranteed on the public Internet because of all the nodes in between over which no one has control (and Joost’s <a href="http://www.layer3media.com/joost/joost-network.pdf" target="_new">technical paper</a> admits that). And in the above example, we have assumed that all the peers are fairly close – what if the majority of these peers lived across the Atlantic? QOS would be non-existent – you can’t wish away latency at those distances.<br /><br />Of course, Joost could forget about the long tail and focus more on the Fat Tail (the other end of the graph where the big numbers are). Yes, that would work, wouldn’t it? It might even work with P2P streaming assuming some of the physics were taken care of. Wait! There is another technology that serves the Fat Tail quite well – its called Cable TV!<br /><br />Incidentally, L3 Technology works with both the Long Tail and the Fat Tail. And it uses P2P but in a download and play scenario. I will write next about how P2P really works in a real word scenario. Stay Tuned!Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com5tag:blogger.com,1999:blog-19197835.post-40533141276024730742007-05-14T13:57:00.001-07:002007-05-14T14:42:08.398-07:00Misunderstanding P2PMea Culpa. I have been guilty of some lazy thinking about P2P. And it is unforgivable because my own technology L3, relies greatly on P2P.<br /><br />If I seem fixated on Joost, please forgive me; they just happen to be in the news a lot these days. Plus, I have used Joost (as well as Jaman) and so my examples often use them. However, Joost will not be alone in having problems with P2P; Vudu, Zattoo, UUSee (China) and a host of others will have similar issues. Jaman, on the other hand is at least technologically sounder (in my opinion), because they use download-and-play and P2P works great with that. But Jaman has some other weaknesses. By the way, I quite enjoyed the videos I have been watching on both Joost and Jaman.<br /><br />But, I am getting ahead of myself. Lets back up.<br /><br />A quick pop-quiz. Of the following count those you would classify as P2P:<br /><br />Kazaa, Skype, Napster, BitTorrent, Joost, Hotmail, YouTube, AIM<br /><br />If you said all, give yourself a pat on the back. Now, it may sound like semantics, but yes, Hotmail – most email for that matter – is a Peer-to-Peer application. When it is not, it is usually Spam. But I am trying to make a point here. There are P2P applications and there are P2P technologies. Email and to a lesser degree a site like YouTube, are P2P applications. BitTorrent is primarily a P2P technology. Of late, BitTorrent is positioning itself as a distributor of video so it is morphing towards being both – a P2P application as well as a P2P technology.<br /><br />In my earlier post (<a href="http://l3media.blogspot.com/2007/05/7-reasons-why-joost-could-fail.html">7 reasons why Joost could fail</a>), I had mentioned that the creators of Joost were P2P people and so they used it in Joost. In fact, Skype is a P2P application and Joost uses P2P technology – in a sense they are apples and oranges. Hence, I was guilty of intellectual laziness. However, I still stand by the point of the argument in that article – that people use what they know, and that sometimes blindsides them.<br /><br />Now that we can tell a P2P application from a P2P technology, let us look at two types of P2P technologies that can be used for Internet Video.<br /><br />P2P Downloads – this is what BitTorrent does. You exchange files with others through your Internet connection. You can download the files any time and watch the video whenever you want (except instantly) – aka download and play.<br /><br />P2P Streaming – what can I say? This is dead before you can say “Peer”. I had not really given it a lot of thought when I wrote the aforementioned article, yet I could tell there was square-peg-round-hole problem there. Which is why I simply relied on someone else’s quote that they found significant overhead in P2P streaming. I was right, but guilty of not following the thought process through to its logical conclusion.<br /><br />It is easy enough to do the math. A typical home broadband connection (Cable or DSL) is asymmetric. My connection at home is 1536x256kbps. Which means I can download six times faster than I can upload. For the sake of simplicity, assume that everyone has the same connectivity. This means that if I were to use my DSL connection to watch Joost <span style="font-weight: bold;">it would take six peers to service my viewing</span>! Joost freely admits <a href="http://www.stdlib.net/%7Ecolmmacc/slides/Joost-network.pdf">in this presentation</a> by Colm MacCarthaigh – Joosts Network Architect that<br /><br /><span style="font-style: italic;">Joost servers “top-up” the DSL“bandwidth gap”</span><br /><br />In other words Joost will never be a purely P2P application. They will always need servers providing a majority of the bandwidth. My guess is that they may be able to save about 10% of their bandwidth by using P2P (assuming there are peers).<br /><br />Now this is why the Download and the Streaming models of P2P are very different. In P2P streaming this situation requires six peers as shown above, whereas in P2P downloading you can have as few as one peer – it will simply take six times as long as to get the file. But in the latter case, when you are done downloading you can watch a flawless playback. In the former, you have no guarantee of the quality.<br /><br />Also, unlike other streaming video offerings, Joost cannot make effective use of CDNs (Content Delivery Networks) to improve quality or save bandwidth. From the same presentation:<br /><br /><span style="font-style: italic;">We’re willing to peer, but is there much point? Only portions of the long-tail are</span><br /><span style="font-style: italic;">peerable.</span><br /><br />And<br /><br /><span style="font-style: italic;">Joost servers also handle the “longtail” (which is still pretty long)</span><br /><br />I may be mistaken, but it sounds like they don’t want to peer into other ISPs and so a CDN (which does exactly that) would not be of use to them.<br /><br />There is another problem with P2P streaming. Since it is streaming, and streaming is real time, <span style="font-weight: bold;">other peers have to be watching the same content at the same time as you are. </span>Okay, you can stagger it a little bit, and perhaps that will help the first problem mentioned above (that is, reduce the number of peers I need). Again, since I am familiar with Joost, I know they use a 2GB buffer on my hard disk. So, some of the stream (I would guess about an hour and a half based on the quality) can be saved locally and this could be used to help out all those peers who are watching the same content at the same time as you are. Wait! Stop the presses! That sounds suspiciously like prime time! I wonder if we can get a Walter Cronkite clone!<br /><br />I hope I have convinced you that P2P works best with downloading. With streaming P2P works hardly at all and if some people are to believed, it is even counter-productive. In fact I am a big fan of Peer-to-Peer distribution, because used correctly it does address the Long Tail. That is what my next article will be about. Watch this space!<br /><br />P.S. Do read about the Long Tail of Bollywood <a href="http://l3media.blogspot.com/2006/04/bollywoods-long-tail.html">here</a>.Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com6tag:blogger.com,1999:blog-19197835.post-57822825439218945412007-05-07T00:28:00.000-07:002007-05-10T03:24:14.167-07:007 Reasons why Joost could fail…<span style="font-size:85%;"><span style="font-size:100%;">...and one reason why it probably won't.</span><br /></span><br /><p class="MsoNormal">Joost is the new, new thing in Internet Video.<span style=""> </span>Pronounced 'juiced', it is an interactive software for viewing video over the Internet using peer-to-peer TV technology, and also has some social networking features that allow chatting and networking while viewing video. Niklas Zennström and Janus Friism, who create and founded Joost, are also founders/creators of Skype and Kazaa).</p> If they did Skype and Kazaa, they must be smart, right? But very smart people sometimes make very big mistakes. Sometimes it is because they remain glued to their old paradigms. Below I describe some of the mistakes they have made – some in the core concepts of the technology and business model.<br /><br />1. <span style="font-weight: bold;">Joost relies on Streaming Video versus Download & Play.</span> I have written a lot about this <a href="http://l3media.blogspot.com/2006/05/why-streaming-video-is-wrong-for-iptv.html">here</a> and <a href="http://l3media.blogspot.com/2006/08/current-future-iptv-models.html">here </a>and I won’t repeat it. The point that needs to be made is that with Streaming, you cannot guarantee Quality of Service (QOS). Even with excellent bandwidth on both sides, you can still get jittery, jerky and stalled video at least some of the time, because of the all nodes in between that are outside your control. With Cable TV you get excellent quality 100% of the time. This is one of the reasons IPTV has not been successfully deployed although people have been trying for more than a decade.<br /><br />This is the first mistake made by the creators of Joost. I believe they simply accepted the prevailing paradigm that Internet Video means Streaming Video. Instead, downloaded content guarantees QOS because it is local and today’s storage mechanisms are robust enough to deliver even HD quality video seamlessly. Ultimately, it is not about the cool technology – it is about the user experience.<br /><br />There is of course another twist to this. A lot content providers prefer streaming, because they feel that if it never leaves the server, it is safe from piracy. So Joost may have been forced to use Streaming Video by the content owners. However, it is a misconception that Streaming Video cannot be copied. There are numerous utilities out there that will download the content behind any streaming link.<br /><br />2. <span style="font-weight: bold;">Worse, Joost uses (or at least plans to use wherever possible), Peer-to-Peer Streaming Video.</span> First, like server-based Streaming, guaranteeing QOS is not possible. It is even harder with Peer-to-Peer (P2P), because there is no control over the bandwidth of the peers. For example, someone streaming to you may suddenly decide to engage in some other activity that affects their bandwidth to you, and the stream delivered by them becomes choppy and jerky. They may even shutdown their device altogether and you lose whatever they were supposed to transmit to you. Can you say "massive overhead"? See also this Wikipedia article on "<a href="http://en.wikipedia.org/wiki/Peercasting">Peercasting</a>".<br /><br />According to an unverified source, a Dutch ISP has tested Peer-to-Peer Streaming in the field and found that approximately 40% additional overhead is to be expected in using this technology. It is not clear whether the overhead is in the bandwidth (due to retransmission) or in processing (due to reconfiguration of the sources). However, it makes sense that there is overhead when combining buffers from multiple peers. And if one of the providers becomes unavailable, there will be tremendous overhead in reconfiguring the others.<br /><br />P2P works best when downloading, as BitTorrent has shown. This is because the download does not have to be sequential like a stream and there is plenty of time to download missing portions of the file later. Unfortunately, the creators of Joost know peer-to-peer best (both Kazaa and Skype are P2P applications) and people have a tendency to use the technology they know best – even if it is sometimes inappropriate.<br /><br />3. <span style="font-weight: bold;">It essentially duplicates Cable TV.</span> Using a broadcast model and channels with a fixed schedule, instead of allowing time shifting and VOD. To be fair some channels on Joost are VOD, but again, in terms of relative volume of VOD content vs. broadcast content it is the same as Cable TV. Another reason why IPTV has not been successful – there is not a sufficiently compelling reason for a consumer to switch. There is the promise of additional content but that has not materialized and even where it has, there has not been so much additional content, that consumers are willing to switch to IPTV (with its disadvantages) and abandon Cable TV.<br /><br />4. <span style="font-weight: bold;">No user contribution possible.</span> Content has to be approved by Joost. This is a big deal. No company in the world can conceivably license all the content in the world. Even if someone had a lot of money (several trillion dollars in readily available cash), they still need the time and resources to contact every content-owner to license their content. If they don’t have cash, they will be spending huge resources on negotiating content rights and royalty payments (possibly several trillion person-days!) – some licensing contracts run into a hundred pages or more! And of course they will be competing with other players who are willing to offer a higher royalty or show a larger installed base (the dark specter of Redmond always looms in the background).<br /><br />What is needed is a model where a content owner simply adopts the technology and can control pricing, distribution, everything. Like the DVD platform – all the content owners had to do was to create the DVD. They didn’t have to negotiate with anyone because they already owned the rights. I can’t help plug L3 of course, but that is one of is strengths – no rights negotiations are required, the content owner simply convert their video into the L3 format.<br /><br />5. <span style="font-weight: bold;">Their software is open source.</span> At least large portions of it apparently are – see <a href="http://www.netkwesties.nl/editie149/artikel2.html">this article</a>. If significant portions of the software are open-source all the code must be open source according to my understanding of the GPL (the licensing protocol for open-source software).<br /><br />Although this is definitely a weakness, it is not a very big deal. Once they are successful (or perhaps they are doing this even now since they have plenty of money), they can rewrite the code. And frankly, the bigger challenges, as the same article points out, are on the business end.<br /><br />6. <span style="font-weight: bold;">It is a lean forward experience only.</span> A successful video deployment on the Internet will be one that provides both a lean-back and a lean-forward experience with the emphasis on the former. You cannot change the behavior of the vast majority of consumers who are used to and want the lean back experience of watching video on TV. It may work for 25 year olds, but most geeks who design this software forget that not everyone is their age.<br /><br />7. <span style="font-weight: bold;">Joost could be regulated like a Cable Franchise.</span> See <a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=932980">this article</a> for a good overview of possible regulation (the authors do make a case against regualtion). Although many companies providing IPTV are arguing that they should not be regulated in the same manner as Cable TV, they may not win that battle. AT&T in the US, MTNL in India, China Telecom, all of them are fighting the respective regulators. AT&T has even gone to congress to pass a bill that would allow them to obtain franchises nationwide rather than from each municipality. Until such a law is passed, Joost has a problem.<br /><br /><span style="font-weight: bold;">…and one reason why it probably won’t.</span> A Venture Capitalist once said that he never looks at the business plan or financials. He simply looks at the quality of the team. According to him, a good team can fix a bad business plan (perhaps even bad technology?), but a bad team can mess up even the best business plan. So, a team like Zennstorm and Fris can fix the problems Joost has. Of course, I think they can only fix it by using L3 technology. :-)Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com8tag:blogger.com,1999:blog-19197835.post-59259908747625817092007-05-03T02:27:00.000-07:002007-05-10T12:56:25.242-07:00Vindication - (The HD-DVD DRM Blowup)At last count, the score was 550,000 (A round number coincidentally - but irrelevant). What is relevant is that this number represents the number of pages with the hexadecimal code that, along with some publicly available tools allows you unlock the DRM encryption on HD DVDs. Thousands of users decided to post the number on the Internet as defiance against the MPAA. Here is the rate at which this phenomenon grew:<br /><br /> Google hits<br />May 2nd 2pm 52,000<br />May 2nd 6pm 323,000<br />May 3rd, 5am 550,000<br /><br /><br />I don’t want to publish the hexadecimal string on my blog, because I don’t want a takedown. But because I also believe that it is immoral if not illegal. But then you have 550,000 other places you can get it. Slashdot for example: http://yro.slashdot.org/yro/07/05/01/1935250.shtml. You can even buy a T-Shirt with the code on it http://www.cafepress.com/umbers.129066329<br /><br />So what does this prove? Why do I feel vindicated? I’ll tell you. I have always said – any encryption scheme can be broken, if all you need is the correct key and or algorithm. We know that in order to protect content – Audio, Video or for that matter any kind of content, you have to encrypt it. We all have used and some of us know about DVD-CSS – the CSS stands for Content Scrambling System and is used on all DVDs. Listen to this:<br /><br /><span style="font-style: italic;">In the video world, CSS means an annoying, relatively weak encryption scheme found on most DVD-Video discs.<br /><br />The program, called qrpff, can simultaneously decode and play DVDs. Qrpff is seven lines of Perl code that, … removes CSS, … [which is] used to provide digital protection to DVDs ... The code was released as the appeals phase of the DeCSS trial is beginning to gather steam. DeCSS is another program that removes CSS and allows for copying or viewing of DVDs.<br /></span><br />What is important about DeCSS is that it was created by three people of which two remain anonymous and the third was then a teenager. One can safely presume that these three were teenage collaborators who broke this encryption scheme in their spare time. Apparently in about three months.<br /><br />This is the scheme that the multi-billion dollar movie industry chose to protect their content worldwide. There are many such examples of encryption keys being compromised either by a hacker or by leaks (usually ex-employees with a grudge/vendetta).<br /><br />A very simple explanation:<br /><br />1. Copy protection typically consists of algorithms and keys, which can be discovered and/or broken.<br /><br />2. So change the algorithm and/or the key as often as possible.<br /><br />In other words, the answer to protecting content is not a really complicated or powerful algorithm. The answer is a comprehensive copy-protection scheme whose parameters change all the time. So, if one algorithm or key is compromised, you will at most lose a few items of content. Of course our L3 solution has some other features that are important too – such as “fingerprinting”, which allows you to trace the source of a pirated copy of the content.<br /><br />It is time for content owners to go to the next level to protect their content. Use L3.Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com0tag:blogger.com,1999:blog-19197835.post-74847834956375706502007-04-27T04:59:00.000-07:002007-04-27T05:11:45.940-07:00FCC: Use L3 technology?According to FCC Commissioner Kevin Martin: 'Something needs to be done.' About what? Well, the FCC believes that violence on TV needs to be regulated. Of course they didn’t define violence or provide any guidelines for what they call "excessively violent" programming. Instead, they argued “that Congress could develop an appropriate definition of excessively violent programming, but such language needs to be narrowly tailored and in conformance with judicial precedent”. In other words, they passed the buck. Read the FCC press release <a href="http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-272652A1.pdf">here</a>.<br /><br />The FCC, which yesterday issued a 22-page report on the subject, said any regulation should also apply to cable not only to broadcast TV. The report also singles out violent commercials, but makes no mention of advertising regulation.<br /><br />Sen. Jay Rockefeller, D-W.Va., who has pushed for regulation of violent content, immediately climbed his soapbox and praised the report. The American Civil Liberties Union called the FCC recommendations "political pandering." What’s a parent to do?<br /><br />Should Congress decide what my kids see? I don’t think so. My wife and I do. In fact, my kids (ages 11 and 9) are more circumspect about what they see – immediately covering their eyes when people kiss for example. (They are great kids – what can I say?) What is more important is that they rarely watch TV alone – unless they are watching something innocuous like “Magic School Bus”, and even then we keep an eye on things.<br /><br />But it goes deeper than that. How do you define or regulate “excessive violence” or for that matter sex on TV? Shouldn’t there be some kind of rating system like movies (G, PG, PG-13, R and X)? Of course I believe it needs to be more granular than that. I would prefer a scale from 1 to 100 or at least A to Z. The numeric scale works better for me because it is easier to comprehend immediately.<br /><br />But I have an even better idea. Why not rate each scene or even parts of scenes. Then I could watch a movie like say, “Dances with wolves” with my children and skip scenes above a certain rating. It works like this. Let us say most scenes in that movie are rated 40 on the sex scale and 40 on the violence scale. A few scenes are rated higher, for example when the Chief is making whoopee with his wife under the blanket, the scene is rated at 65. I could set my rating preference at sat 45, and those scenes would be skipped. Of course, later, my wife and I could watch the movie again and set our preference at say, 75.<br /><br />Incidentally, the FCC “believes that the V-chip is of limited effectiveness in protecting children from violent television content”. And also that “further action to enable viewer-initiated blocking of violent television content would serve the government’s interests in protecting the well-being of children and facilitating parental supervision and would be reasonably likely to be upheld as constitutional.” The key words there are “viewer-initiated blocking”. Which is exactly what I am proposing. Sounds like the FCC is calling for the adoption of the L3 format! Woo-hoo!Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com0tag:blogger.com,1999:blog-19197835.post-1176030926402052992007-04-08T04:14:00.000-07:002007-04-08T04:15:26.403-07:00About Ads and L3 Technology – Part 2But what about measurement? The Nielsen ratings method, as I mentioned in Part 1 is “rust-belt” technology. We know it is inaccurate at best (I have been a participant in Nielsen one season) and it doesn’t reflect the real behavior of people watching TV. For example, how does channel surfing reflect in the ratings? Yet, I will guarantee you have done it, and possibly do it on a regular basis - especially if/when you watch TV alone.<br /><br />So what are you as an advertiser really paying for? You are paying for a best-effort guess of the number of people who may watch your ad in a specific program, assuming that the program is as interesting/entertaining as the previous episodes of that program or worse of programs like it. If Nielsen, using its flawed technology says more people watched it than expected, you celebrate, otherwise you weep. And you put up with this?<br /><br />No, you ask for L3 technology. :-) Of course. Where the number of times an Ad is played is reported to you by the minute. Where you get reports that let you drill down to an individual (although privacy laws may prevent that level of disclosure). Where you control your budget in advance and your budget could be $1 or $1 billion. Where you can change what you are willing to pay for your ad on the fly. There is a lot more, but you get the idea?<br /><br />Oh, one more thin mint. When I say, “you can change what you are willing to pay”, I meant you could change it to anything. Chew on that for a second. Suppose you were paying $30CPM for an ad. Let us say it is a really funny ad, your ad itself becomes really popular and people want to watch just the ad. You could change the CPM to say -$10. In other words you are not paying anymore, you want to charge people to watch it. So now you could actually earn money whenever anyone watched it.Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com0tag:blogger.com,1999:blog-19197835.post-1176030849675162532007-04-08T04:09:00.000-07:002007-04-08T04:14:09.686-07:00About Ads and L3 Technology – Part 1This is a copy of a blog I posted on <a href="http://www.adholes.com">www.adholes.com</a><br /><hr><br />Many people don’t respect copyright and on the other side copyright is often abused (DMCA is a great example). However, it is still necessary to protect the creative rights of artistes and to provide for the engine that brings copyrighted works to you. One of the key concepts I started with, was that content needs to be monetized.<br /><br />On TV content is typically monetized by placing ads within the content. However, that process is a seriously flawed remnant of the “rust-belt” era of engineering. Today when you visit a web page, especially if it is a site where you have to login (such as Adholes), it could precisely target ads for you. How? When you registered, you told Adholes where you live – some sites even know your Zip code. There is a place to enter your interests. You even entered your bio. On many sites you specify your interests by entering keywords or picking categories. It is not rocket science to target ads to you and many sites do that already.<br /><br />But what if you could do this on TV? What if ads were not “baked-in” at the point of broadcast, but inserted on the device that sits in your own home? So they could be targeted to you. There are other advantages of inserting ads locally, but I won’t get into that here.<br /><br />When you install your TiVo, you tell it your Zip code. TiVo prides itself on determining your interests based on what you record. So again targeting ads should not be too difficult. However, TiVo has not capitalized on this.<br /><br />My technology goes even further. Apart from using heuristics to find viewers interests, it specifically asks the user for interests, categories and favorites. This is done in non-intrusive way by an occasional question on the screen. Then it is a simple matter of matching the ads to the interests. Plus, in my system, even the content has keywords associated with it. So, if not enough is known about a viewer, the content provides enough clues to target ads.<br /><br />There are other advantages in the system too. For example, the software knows what time it is. Cereal ads at breakfast time? Pizza ads at dinner time? That’s just the beginning – how about a Saturday afternoon ad that tells you that a band you like is playing that evening a few blocks from your home (because it knows your taste in music)?Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com0tag:blogger.com,1999:blog-19197835.post-1175415025065928552007-04-01T02:09:00.000-07:002007-05-07T00:39:57.262-07:00Warren Buffet on IPTVFrom the “Tao of Warren Buffet” by Mary Buffet and David Clark:<br /><br /><span style="font-style: italic;">“You have to think for yourself. It always amazes me how high-IQ people mindlessly imitate. I never get good ideas from talking to other people”.<br /></span><br />Perhaps he might have clarified that it is okay to talk to other people as long as you don’t mindlessly accept their version of the truth. Of course Warren Buffet was not talking about IPTV, it was a come-on – he never talks about technology and certainly never invests in it. Did you know that he doesn’t like GE and Intel because they have to constantly retool their products? On the other hand he invests in Wrigley’s and Coca-Cola – their products have not changed in over a hundred years!<br /><br />Anyway, what is the connection to IPTV? If you talk to most people today – they think IPTV is the only solution out there to deliver video. And most people also confuse IPTV with Streaming Video. And it amazes me to see that people mindlessly repeat what others are saying about IPTV – even ignoring their own experiences.<br /><br />Allow me to elaborate. First Streaming Video – when was the last time you saw an entire movie (not You Tube Shorts, but something that was at least 72 minutes long) delivered flawlessly over the Internet. If you did, send your information to the Guinness Book of World Records, because you have a shot at being the only one. And this is supposed to replace Cable TV or Satellite TV? Think again.<br /><br />And IPTV, even if it could be delivered flawlessly over Streaming Video, would it replace Cable TV? When was the last time you saw a technology take over that did everything a previous technology could do? And not do it better? Lets run that through again. Assume for a moment that someday in the not-so-distant future the user experience is the same. Same business model, same customers. Different technology, and you don’t own the pipe, plus content is reluctant to come on board.<br /><br />Chances of success? Zero.Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com0tag:blogger.com,1999:blog-19197835.post-1159893279824414042006-10-03T09:23:00.000-07:002006-10-03T09:34:39.840-07:00The IPTV conundrum in AsiaThis blog is a reaction to a White Paper I read called “The IPTV conundrum in Asia” by Parks Associates.<br /><br />Hong Kong has 500,000 IPTV subscribers. Part of this may be due to the density – it is much easier and cheaper to wire inside a building than to a building. Once you are inside, you can light up 20 floors times four flats – 80 subscribers with 1000 feet of cable. Try that with 80 homes in say, Milwaukee, Wisconsin and you are talking about covering at least 10 acres and 10 miles of cable.<br /><br />Of course the main reason that many Asian countries including parts of China such as Hong Kong, but most notably Korea are much further along than the US and Europe in Broadband to the home. A notable exception – India.<br /><br />Another good reason is that Asian content providers, being more realistic than their western counterparts have been willing to give their content to the IPTV providers. Again, a notable exception has been Indian content-owners but that has changed recently.<br /><br />According to the paper there are two rules of thumb for Asia (I believe this applies even in the US):<br />1. Consumers may like the instant gratification offered by video-on-demand, but they won’t live without the linear (i.e. traditional) format of TV today.<br /><br />2. “Cheap is good: free is better” – consumers are hesitant to purchase expensive equipment from operators. Low-cost set-top boxes have thus become a key ingredient for success.<br /><br />I agree completely with the first item – it is a well known fact that consumer behavior takes as long as a generation to change. The second point is also well-made, but the conclusion is arguable. Instead of low-cost set-top boxes, the providers need to combine set-top boxes with PVRs or at least DVD players. And these set-top boxes need to be operator-neutral, or customers will balk at paying to be tied to one operator.<br /><br />An interesting finding of the paper was that “Asian consumers are more comfortable than other people in the world ….(with PC-TV convergence, which) … has already occurred in terms of how consumers view the various platforms. I wonder if this has to do with the fact that all these gadgets appeared in homes at about the same time unlike in the west. It could also be that Asians, unable to resist a bargain (it is in the genes), see potential savings in the convergence. As my uncle used to joke “Indians will fly to the US (or Europe) standing if airlines offered it inexpensively enough”.<br /><br />Another very interesting point – the appeal of an interactive program guide is actually lower in Asia than the US or Europe. I have no idea why this should be so, perhaps a reader can enlighten me.<br /><br />One seemingly unimportant sentence in the paper stood out for me – “…getting Asians to pay for the features they desire will be difficult”. Wrong! However, getting them to pay for features that the providers want them to want (because it fits their business model) will be. At least from the Indian experience, it is clear that if there is compelling value, and people want a feature, they are willing to pay for it. Take for example DVD players. I have spoken to several industry experts and front-line businesspeople who said the rush to buy DVD players was unprecedented. In just a few years DVD players have become more pervasive than VCRs ever were.<br /><br />And that is the bottom line. Give consumers what they want – and they will pay for it. What a concept, huh?<br /><br />So what do consumers want? They want somebody to manage all the content that is available to them. In addition, they want niche content – programs in their language (remember India has 22 languages) even when they live outside the normal reach of that language.<br /><br />It also means being able to watch anything anytime. The intelligent functions of a PVR will definitely sell well. In our demos, people love the idea of being able to record all episodes of their favorite shows, or simply pausing live TV.<br /><br />There is a growing segment of Indians who are traveling both for business and pleasure, and many that have returned from long foreign sojourns who want more than what is available on Cable TV. This is what India’s marketer call the “Aspirational Segment”. They want not just Hollywood movies, but the content that relates to the lifestyles they left behind in the US or Australia or elsewhere.<br /><br />More on that later…Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com1tag:blogger.com,1999:blog-19197835.post-1159892512882147822006-10-03T09:13:00.000-07:002006-10-03T09:21:52.906-07:00Learn from TiVo<em>This is an old one that I had published in 2005 elsewhere - but it is still relevant.</em><br />One thing we can learn from TiVo’s stumbles is to not ignore the customer. And more importantly, to know who your customer is.<br /><br />TiVo avoided the consumer – they still do. They did not have a good process to support sales. And their support is abysmal. Did you know they removed email support? The on support available is by phone – and it is only an automated system – rarely do you reach a person. And of course if you bought a TiVo branded by another company you are completely out of luck. Here is a company that seems to be going backward not just technologically but also in customer service attitudes.<br /><br />As I have mentioned, they knew that people who buy TiVos become TiVo evangelists, yet they did not mine these people. Check out TivoCommunity.com – the tone there is more like a Linux mailing list than a user community. Any user who asks a “newbie” question gets jumped on.<br /><br />I myself have sold people on the benefits of a TiVo (grudgingly of course – who wants to make the competition stronger), and they have gone out and bought them. Not only that they call me up and tell me how they love their TiVo – these are rational people, mind you! I evangelized TiVo for a while before I realized that the business I wanted to be in needed something like a TiVo to use as a platform. And I decided to build my own.<br /><br />TiVo should have set up a selling process that demonstrates the benefits of TV. Try asking someone at Best Buy or Circuit City about a TiVo, and the most you will learn is that it’s like a VCR with a hard disk, and that you have to pay $12.95 a month for the service. Demonstrate it once, and you would have a stampede that your cashiers could not handle. Selling anything with many and complex benefits requires salespeople, not shelf stockers.<br /><br />But one really important things that many surveys and industry experts have pointed out is this – TiVo’s best customer is not he 18-35 male electronics and gadgets buyer. Surprised? I was too. Although the buyer is usually a male, most users and evangelists are their female counterparts, and often have children. My wife, who is as close to a Luddite as anyone I have met, loves TiVo. It’s simple – she can control how much TV the kids watch, what they watch, and most important, when they watch it (on weekends after homework is done). And does TiVo market to this segment? Not a chance. In their place, I would have put together a Tupperware-type network to sell TiVo – one mother to another. Anyway, no one has offered me the VP Marketing position there, so I will make my own!<br /><br />I think early on TiVo decided their customers were going to be the DirecTVs of the world. That is why they kept courting the satellite and cable companies. But when push came to shove, they decided they were too good to partner with the likes of Comcast. That really triggered the resignations you heard about after CES 2005. Suddenly they are mouthing off about how TiVo is more than just a set-top box, and consumers want more than the ability to store programs and fast-forward and rewind. The CEO Mike Ramsay went so far as to say that the Cable TV business was not the business of the future. Well Duh! And it took you how long to figure that out? TiVo should have figured that out long ago – many people including yours truly did. And they were in that business! That’s like finding no WMD in Iraq. Again, I can’t resist it – Duh!<br /><br />Of course, it’s not all over for TiVo. Ramsay is right about disruptive technologies like TiVo and even better technologies like L3 destroying the Cable business over time. But mind you, we are talking twenty or more years for the cable business to go away. And then you will have Internet TV businesses that… oh, yes, might be called Comcast and Time Warner…Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com0tag:blogger.com,1999:blog-19197835.post-1155101491919738732006-08-08T22:30:00.000-07:002006-08-08T22:31:31.936-07:00Current & Future IPTV ModelsMost people in the video content and delivery industry believe that the method of delivering content in the future is going to shift primarily towards the Internet. However, it is important to create a roadmap for acceptance in the industry – consumers, manufacturers, content owners and advertisers must clearly see a benefit in the short term so that they will adopt the new technologies in the long term.<br /><br />In the current IPTV (Internet Protocol TV) model, video is generally stored on a server and then “streamed” over an Internet connection to the user when requested. Hence IPTV can simulate “channels” similar to Cable TV, but it can also provide Video-on-Demand (VOD). In fact, IPTV has an edge over Cable TV in VOD applications. An IPTV customer is either given or sold a set-top box by the ISP (Internet Service Provider); this box being used as a “tuner” that interacts with the service and displays video on TV. In the most sophisticated IPTV applications, the box is also used as a payment gateway.<br /><br />Current IPTV models – both business models and technical models, are essentially similar to Cable TV models with some minor variations. While the current models are workable solutions, there are several missed opportunities with both the technology and the business models in use today.<br /><br />First, Streaming Video, although designed for the Internet, is unreliable in practice. If the video is not on the ISP’s network, its delivery to the consumer cannot be guaranteed. Sometimes, even when the video is on the same network as the consumer, there can be quality issues when concurrent usage is high. Also, when the content is outside the ISPs network there is a significant additional cost to the ISP in the form of peering and bandwidth charges. Thus many IPTV providers are forced to negotiate rights to content in order to place the content on their own network – this creates a significant and ongoing operational burden as well as substantial upfront costs.<br /><br />Second, current IPTV models generally do not support features that are intrinsic to an Internet based delivery system. An excellent example is file sharing (peer-to-peer or P2P), which can result in a significant cost saving in bandwidth if managed correctly. It also provides a strong marketing opportunity due to its viral nature. However, no current IPTV system supports file sharing because the technical problems of legal file sharing have not been solved until now (L3 technologies do solve the problem). <br /><br />Third, IPTV models that deliver streaming video using the “Client-Server” approach require significant upfront costs to launch successfully. The primary reason is the cost and operational issues of deploying servers near the users. This also impacts the ability of IPTV providers to quickly expand into new geographic markets. An IPTV provider needs to be able to enter this market at a very low capital cost; else this cost can become a barrier to success.<br /><br />Fourth, using streaming servers predicates insertion of ads before the content reaches the user. This prevents extremely granular targeted advertising. Cable TV is capable of ads targeted at the neighborhood level. However, if correctly deployed, IPTV can target advertising at a significantly higher level of granularity than Cable TV. For example, advertising can be related to (a) the content being viewed (b) the location and preferences of the user, and (c) the time at which the program is being viewed (as opposed to when it is broadcast). This is very similar to the kind of advertising model available on web pages, and it will not be long before video advertisers expect or even demand it.<br /><br />Finally, getting consumers to accept IPTV initially is a significant marketing challenge – they are generally satisfied with their Cable TV or Satellite TV (DTH) services. Although IPTV has significant advantages over Cable TV in the long term, any IPTV solution that hopes to introduce “yet another box” into the living room, must have a compelling current selling proposition to a consumer. Also, a “go-it-alone” approach in IPTV means that the IPTV provider has to negotiate a critical mass of content rights. As described above, this can be operationally burdensome, expensive (since most content owners are unconvinced of IPTVs potential, they often demand a premium for those rights) and a barrier to quick entry. Hence, an ideal solution is one that coexists with the current paradigm/providers of Cable TV, but introduces future distribution models in the form of IPTV.<br /><br />Thus, what is needed is a technology that propels IPTV to a higher level than Cable TV can achieve through their model; a compelling set of current features that are compatible with the way people watch TV today; and the promise of new features that will improve their TV watching in the long run. At the same time, the technology must be so attractive to both content and advertising that these industries will “pay-to-play” rather than the other way round.Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com0tag:blogger.com,1999:blog-19197835.post-1146473393670290292006-05-01T01:34:00.000-07:002006-08-08T22:33:51.956-07:00Why Streaming Video is wrong for IPTVIn a previous blog I had explained the basics of IPTV. In this, I want to explore one method of deploying IPTV and why it is doomed to failure. Let me also point out that Streaming Video and Streaming Audio are parallel models and together are often referred to as Streaming Media.<br /><br />Lets start by noting some of the well-known methods of transmitting video across the Internet. The simplest and oldest method uses the File Transfer Protocol (commonly called FTP). A recent and very popular method called BitTorrent allows very fast transfer of files under some conditions – for example, it excels in peer-to-peer networks.<br /><br />Now lets look at Streaming Video – again, this bit is a rehash from the previous blog, but it is important, so please stay with me. Streaming Video is a method of transmitting video files so that a portion of any video starts to play in your video player (for example Windows Media Player or Real Player) while the rest of the file is being received. All other commonly used methods require that the entire file be downloaded before it can be played.<br /><br />Streaming Video essentially creates a “buffer” which fills up as the video is received. At any time, if the connection becomes slow or is briefly interrupted, the video continues to play uninterrupted from the buffer. Meanwhile, in the background, the player attempts to download more of the video into the buffer.<br /><br />As I have said before, that is the theory, but in practice, interruptions and slowdowns of Internet connections are rarely brief. So, there is not enough of a buffer to supply a continuous stream while the video is being viewed. The video becomes choppy and grainy, sometimes freezing altogether - resulting in a poor viewer experience.<br /><br />Let us say you are lucky enough or rich enough to buy a super-fast connection to the Internet. All you need to worry about now is that people in your neighborhood are not using their Internet connectivity too much when you want to watch a movie on IPTV.<br /><br />“Ay, there’s the rub!” as Hamlet said. However, your ISP is not conflicted, their entire business model is based on shared bandwidth. In fact, Internet connectivity is always shared at some level or the other. Most commonly, connectivity is shared at the neighborhood level. And typically, most people in a neighborhood will go online or download movies at more or less the same time of day. Thus, at the very time when people want the best connectivity, the system will be under maximum load.<br /><br />Internet connectivity is also unpredictable. In some ways, it is like the weather – there are just too many variables. A small storm in one area can result in massive upheavals thousands of miles away. When a stream of video travels from a providers server to a users PC, it could travel through a dozen networks and multiple nodes within each network. And the number of networks may or may not be related to distance. For example, even if the server and the users PC are a few hundred yards apart, the video might actually travel through half a dozen networks. Each of these networks could be having a massive upsurge of traffic just when your movie reaches a cliffhanger moment – literally.<br /><br />It is for these reasons (and a few others) that the promise of delivering video-on-demand through the Internet has been largely unfulfilled. Despite improvements in Internet connectivity and speed, the shared pipes are still not big enough to reliably deliver a consistent and reliable stream.<br /><br />Despite all this, most IPTV providers still use Streaming Video. Why do they want the worst possible protocol for transmitting over an unreliable and narrow pipe? For the single reason that, because it starts to deliver video to the user immediately, most people think that it is still the best way to achieve Video-on-demand. Other known protocols will force the user to wait until the entire file is downloaded.<br /><br />But are there alternatives? Yes, and it is obvious once you think about it. The best way to deliver Video-on-demand to a consumer is to have the video already in their home, locally.<br /><br />There is of course yet another way that Streaming Video can work. That too might be obvious after reading the above. If the Streaming Video provider is also the owner of the network, that provider then has far more control over the delivery of video. Let us say AT&T is your ISP, and they also provide content to you in the form of movies. Then, AT&T can design the network so that the movie is on a server near you and also ensure that there is sufficient bandwidth between the server and you. Expensive, but it can be done by running fiber to you door.<br /><br />Unfortunately, such a model has many other issues including the inability of ISPs to obtain content easily. Most importantly, this model requires owning fiber (or at least copper) to the customer. And that limits any company from establishing itself in multiple geographies quickly. It limits them to serving specific geographies in an increasingly mobile world of fragmented audiences. More on this in another blog.<br /><br />Yours truly is also working on a method that will simulate the benefits of Streaming Video but will rely only partly on the speed or reliability of the connection. Wait and see.<br /><br /><br /><div align="justify">____________________________________</div><div align="justify">Copyright (c) Anil Gupte 2006, All rights reserved.</div>Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com1tag:blogger.com,1999:blog-19197835.post-1146413327007375432006-04-30T09:04:00.000-07:002006-05-01T01:54:40.313-07:00What is IPTV?<p>So many people have asked me what IPTV is about, that I have finally decide to write it down. Read on...<br /><br />In IPTV, IP stands for Internet Protocol. In the world of networking, this protocol is the third layer out of seven layers that together create a complete network capable of transporting content from point A to point B on the Internet. This content can be text, pictures, voice, and, this is where our interest lies - video as well.</p><p>Although most people think understanding IPTV is complicated, the basics are very simple. At one level, all we are talking about is the transmission of a file from a server on the Internet (the same server that might also host and transport web pages) to a users PC. In fact it is not very different from the process of serving up web pages - with one exception.</p><p>In other words, and this is important, the transport mechanisms of the Internet do not care what you are transmitting. So, a video file can be transmitted in exactly the same manner as say, a web page (an HTML file). The difference of course is that a video file is going to be much, much larger than just about any web page, hence taking (you guessed it) much, much longer to move from point A to point B on the Internet (the exception I was talking about).</p><p>You know that famous phrase about a picture being worth a thousand words? True or not, a picture can take about a thousand times more storage than a word. Now, multiply that by 30 (the NTSC frame rate, 25 for PAL – if you are not sure, never mind approximations are OK) to get the amount of information in one second of video. Impressed? Now you can understand why everyone thinks transmitting video over the Internet is a “big” deal! It has less to do with complicated technology than size (i.e. the amount of information transmitted). Of course video files are compressible depending on the type of video in the file, but the point is that they are many orders of magnitude larger than almost any other file.</p><p>About three paragraphs ago, I said, “…a video file <em>can</em> be transmitted in exactly the same manner as a web page…” Luckily for me, I did not say “<em>is</em> transmitted”, and that gives me the opportunity to talk briefly about “Streaming Video”, which is often (incorrectly) used interchangeably with IPTV.</p><p>First, let me point out that there are many ways in which a video file can be transmitted over the Internet. And most methods of file transfer can be used with most files. The simplest and oldest method of transmitting files uses the File Transfer Protocol (commonly called FTP). A recent and very popular method called BitTorrent allows very fast transfer of files under some conditions – for example, it excels in peer-to-peer networks.<br />Streaming Video is a more specialized method of transmitting video files. In this method, a portion of any video starts to play in your video player (for example Windows Media Player or Real Player) while the rest of the file is being received. To do this the software essentially creates a “buffer” which fills up as the video is received. At any time, if the connection becomes slow or is briefly interrupted, the video continues to play uninterrupted from the buffer. Meanwhile, in the background, the player attempts to download more of the video into the buffer.</p><p>That is the theory anyway. In practice, interruptions and slowdowns of Internet connections are rarely brief. That is why Streaming Video cannot succeed unless, and this is important, <u>unless the people doing it also own the network</u>. </p><p>And you cannot own the network unless you think small. But more on this in a later article or blog. Stay tuned.</p><br /><br /><div align="justify">____________________________________</div><div align="justify">Copyright (c) Anil Gupte 2005, All rights reserved.</div>Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com0tag:blogger.com,1999:blog-19197835.post-1144588504570421912006-04-09T06:10:00.000-07:002006-09-08T02:51:45.706-07:00Bollywood's "Long Tail"<em><span style="font-size:85%;">Forget squeezing millions from a few megahits at the top of the charts. The future of entertainment is in the millions of niche markets at the shallow end of the bitstream.</span></em><br /><em><span style="font-size:85%;">The Long Tail<br /></span></em><br />To understand what I am about to say, it may help to know about <a href="http://www.wired.com/wired/archive/12.10/tail.html" target="_blank">The Long Tail</a>, first an article in Wired, then a <a href="http://longtail.typepad.com/the_long_tail/" target="_blank">blog</a>, then a best-seelling <a href="http://www.amazon.com/Long-Tail-Future-Business-Selling/dp/1401302378/sr=1-1/qid=1157708043/ref=pd_bbs_1/104-5037423-9226328?ie=UTF8&s=books">book</a>. The author Chris Anderson talks about “The Long Tail” - in content, it refers to the niche audiences for certain types of content i.e. "hard to find". And there is no doubt that there is a long tail for content - having proved its existence at <a href="http://www.iciniema.com" target="_blank">iCinema.com</a>, for example.<br /><br />At iCinema.com the initial audience served is the approximately 3.2 million Diaspora of Indian origin in North America (plus similar numbers in UK, Australia, Africa and the Middle East). Most people can immediately grasp that immigrant Indians in the US want content from Bollywood. After all, if Bollywood has created a buzz even among Middle-Americans, it must be the what this Indian Diaspora is looking for, right? Wrong! It goes deeper than that. Yes, of course there is a demand for Bollywood content, and it cuts across the entire group. But, there is a thriving movie industry in every one of the seventeen regional languages of India (no we are not talking dialects – there are some 300 plus of those). So there is an even longer tail beyond Bollywood audiences, and if you do some “area-under-the-curve” math, you will find those numbers are even bigger than the numbers for Bollywood.<br /><br />L3 Media is all about “The Long Tail”, and more importantly about monetizing it.<br /><br />Okay, so you have an audience for Marathi (substitute your favorite language here – Swahili, French, Russian) films in the US. The average market size for each of the Indian languages is roughly 200,000 (about 50,000 households). How do you deliver content to this audience; and more important, how do you monetize it?<br /><br />But first, let us talk a little bit about how you cannot. Take any one-to-many, traditional, system such as Cable TV or Satellite TV. There simply are not that many channels that these technologies can deliver. If you wanted to service all the Indian languages (or all the Eastern European languages, or all the African languages), you would need about twenty channels even with a single channel per language. And one channel for all the movies, news, interviews etc. that this group might want is simply not enough. There are 65 new movies made in Marathi each year, and the numbers are higher for some of the other Indian languages.<br /><br />Even if you could shovel all the content for each language into one channel there is only so much of it that could be made available at prime-time. You could hope that people would record it on their PVRs, but then how would you monetize it? Certainly not from commercials, because once the content is on a PVR, there is no mercy from that thumb on the fast forward button.<br /><br />Coming back to those 50,000 households to whom you want to deliver content. If you leave out the one-third or so who live in New Jersey or Los Angeles or one of the major metro concentrations of Indians (just look for the “paan” stains on the walls) you have approximately 200 households per ‘B-size’ city (another third) and then a dispersed remainder. Tell me Time Warner or Comcast cares about this market, and I’ll sell you a bridge in Bombay. But aggregate them online and suddenly you have a market! Even at a conservative $10/month average per household (alternative entertainment), you have a $6 Million market. But what if you could give them tons of free content (supported by ads of course), you could see a business that is 5-10 times that. Only problem is, with the current paradigm it is practically impossible to do the latter. How do you insert an ad for the sale at Boston Store in downtown Milwaukee into the current episode of “<a href="http://starplus.indya.com/serials/kyunki/index.html" target="_blank">Kyonki Saas Bhi Kabhi Bahu Thi</a>”. (If you just went “Huh?”, think “Dallas” or “As the World Turns” 20 years ago). The answer to that question is – you can … with L3 technology.<br /><br /><br /><div align="justify">____________________________________</div><div align="justify">Copyright (c) Anil Gupte 2006, All rights reserved.</div>Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com0tag:blogger.com,1999:blog-19197835.post-1132633290776480282005-11-21T20:00:00.000-08:002006-06-12T00:42:17.076-07:00Are you listening, Steve?<div align="justify"><span style="font-size:85%;"><em>On Friday, Leon Long, the president of the association representing ABC’s affiliate stations, expressed misgivings about the partnership, which was announced publicly by Apple Chief Executive Steve Jobs and Disney CEO Robert Iger at an event last Wednesday.<br />…<br /><br />For TV affiliates, Apple’s new offering “is really bad,” says Josh Bernoff, an analyst at Forrester Research in Cambridge, Mass. “You don’t get anything. You get a smaller audience,” he says.<br /><br />Wall Street Journal October 17, 2005<br /></em></span><br />Well Steve, better wake up and smell the iPod. Those hundreds of small town network affiliates are not just going to roll over and die. They represent a big obstacle in the race to deploy the next video distribution paradigm. And why not? Millions of dollars of their money is at stake. To say nothing of the billions of dollars of local advertising money that needs an outlet. You cannot upset the apple cart and tell the apple industry “You don’t get anything”.<br /><br />It is absolutely imperative for the “paradigm shifting” video distribution systems of tomorrow to address these issues. If they don’t, it cold take several decades, maybe generations, more to transition to Internet downloads. Entrenched systems and players are not overthrown easily unless they are given an alternative. And yes, Apple’s brand is powerful, and when combined with Disney and a few other video content owners could dominate this industry. But, and it is a big BUT (no crude jokes here please), if and only if they take care of their current partners and the current players.<br /><br />So what are the issues and how can they be addressed?<br /><br />First, lets examine why there are local network affiliate TV stations. Simple – Local Advertising. Yes, local news too, and some local programming in the larger markets. But the raison d’etre of the local affiliates is their ability to bring local advertising dollars to the mix. Let us pretend for a moment that you could pull the rug out from under the feet of the local affiliates – which by the way would be another step on the road to total globalization and one world government. What would happen to the local advertising? Not many choices, with newspapers on the ropes and Satellite radio cannibalizing local radio stations. Yes, there is a huge opportunity there too, but that is a separate discussion (perhaps two) with its own special twists. Perhaps local advertising would die, and along with it local businesses. “Not bloody likely!” as my father would say in his best British-Indian accent.<br /><br />The answer lies in a system that would separate the transmission of advertising from the transmission of content. In a sense that is what the local stations are doing by inserting local ads into a stream received from the parent brand. And that is exactly what is needed on the net. Needless to say, the system I have filed patents for does exactly that.<br /><br />Second, what is it about pay-per-view that blinds even the smartest pundits to the fact that pay-per-view is a nice concept that most people don’t want? People will not suddenly switch to a new paradigm of paying for TV. Ask yourself this question - would you switch to a system that requires you to pay to watch every single video you want to watch? I hope you were thinking “Not bloody likely!”. Yes, pay-per-view is a very sexy concept, especially from the point of view of the content-owner. But how come, whenever the discussion swings around to the Pay-per-view paradigm the intelligence level of Wall Street analysts suddenly sinks to that of a not too active jellyfish (apologies to P.G. Wodehouse)? Perhaps it is a leftover bit of the myopia that infected them in the great dot-com boom.<br /><br />The point is, people want to watch free TV because they are used to it – their behavioral patterns are reflexively tied to that concept. Yes, they will occasionally pay overtly for premium content or if they simply want a special experience (i.e. without ads). The research indicates that even though Pay-per-view has been available for years, the percentage of ad supported TV is still over 98%. Duh!<br /><br />Again, this is connected to advertising. The solution is to give people a choice between watching content by paying for it directly or watching it subsidized by ads. Perhaps they could even choose how much they would be willing to pay for it, and thereby choose how many ads they would be willing to watch. Dreaming? Not at all – another patent I have filed deals with exactly that.<br /><br />This brings us to the third issue – how much advertising will people be willing to watch? Lets go back to my first point for a moment. I think I made my point that local advertising is important and that it is not only going away, it is desirable. But what is “local” advertising? What kind of advertising, if any, is “desirable”? How about advertising that is so local, it knows who you are, what you like and what time of day you are watching? Scary? Not really, not if you selected the advertising yourself or it was selected by a “bot”. And it was not reported to big brother (whoever he may be). Or if it were reported, the information would be sufficiently aggregated that individuals or even small groups of individuals could not be identified...<br /><br />Yes, I have patents pending that address all the issues I have discussed above – that is why I am hoping Steve will stumble across this page or someone who knows him will....</div><div align="justify"> </div><div align="justify">BECAUSE APPLE REALLY NEEDS TO LICENSE THIS TECHNOLOGY PDQ!</div><div align="justify"></div><div align="justify">____________________________________</div><div align="justify">Copyright (c) Anil Gupte 2005, All rights reserved.</div>Anil Gupte's Various Blogshttp://www.blogger.com/profile/10155963964740739695noreply@blogger.com1