Ubiquitous video panel

 October 27, 2010 Digital media Conference, San Francisco—The second panel of the day addressed “Video Anywhere, Anytime, On any Device” to look at the changing environment for video. Colin Dixon, senior analyst for The Diffusion Group moderated the panel. Other panel members were: Gregg Spiridellis, CEO of JibJab Media, Margaret Kim, vice president of Alloy Digital, David Kaiser, CEO of Coincident TV, and Todd Weaver, CEO of ivi.

Kaiser stated everyone is now expecting a 2 screen experience. The hard part is to monetize the content and synchronize the screens across platforms. Their technology allows any rectangle on the screen to support content.

Spiridellis advocates direct to consumer video, because the web economics of banner ads doesn’t support the potential view base. Banners or in-line ads only generate about $50k for 5-10 million viewers. These ads just don’t pay enough for premium productions. Instead, the video opportunities for expression and utility call for a subscription model. So far, they have generated over 1 million consumer credit card swipes for their services.

Weaver suggested live Internet TV via downloads is the way to go. They can repurpose existing content and keep the existing ads in that content, just like over the air content. A subscription model is good and complements other transaction models. Viewers can interact with the linear feed and overlays. The paid service captures content from broadcast and cable sources and provides conditional access for subscribers over the Internet.

Kim is looking at the challenges of creating content for multiple screens, especially for young consumers. Now, you need to have both sponsored and branded properties to drive ads to. You have to build out the distribution to drive content across the network of sites. As a result, you have a full range of properties to distribute content across a branded environment.

The first issue is apps on TV. Some ad revenues are shared, others call for a bounty. Spiridellis opined that this is a hard topic. To work, the developer network has to keep the apps friendly while capturing the users’ expenses. Kaiser noted that there is a long tradition of TV revenue generation that Samsung is not going to change.

Weaver suggested that TV manufacturers cannot get access to credit fees, so their apps stores will monetize the transactions. The TV set can displace the set top boxes but there is no long-term income involved once this happens. The broadcast networks and cable channels are looking at Google TV but also want to block most types of streaming TV. An Android app will carry the channels.

A follow on question: will Google TV become another outlet?

Kaiser noted that the efforts have had only a short time for integration. All the technology to move the content exists, so eventually the networks will stop blocking streaming. For on-line TV, the top content still will come from the networks. Models will evolve so everyone can make more money. The networks’ concern about piracy is well founded, as about 20 percent of all (rented) DVDs and Blu-Ray disks are copied.

Weaver agreed there is a technology hurdle to stopping sharing, especially for the premium content. He suggested instead that a better way to monetize is to require a license to view the content. As result, you don’t care how the distribution happens, because you got the money from the viewer.

The next question was on handsets and multiple platform delivery. Weaver stated that the content is needed on a handful of formats. SD quality is fine for most small screens but HD doesn’t always make sense. On a medium size screen like the iPad, 720P is no problem. It makes sense to transcode all formats for all devices. Kaiser stated that the small screen is interactive but is not good for the viewer’s experience. Reformatting makes sense when you are jumping to other content or a different display rather than the mobile handset.

Kim observed that short stuff is better for mobile, but there is not enough resolution for most content. Users need platform relevant content. Spiridellis agreed that content format is critical. OTT changes the user experience and increases the staying power of a web site from 1.5 to 2 minutes to the duration of a show. Mobile changes the product experiences by adding two platforms, Flash and non-Flash, for video content. The proliferation of formats and technology has to compete with the Web and browser views.

Extending the topic, Weaver noted that Netflix has over 100 versions of its client. All versions have search and catalogue, but to differing degrees. They port to new devices every 3 months and try to minimize the effort by using a lowest common denominator approach to the development. The CPU, memory, and screen size variables need to be optimized to make all the platforms compatible by cross compiling to get one code base.

What are the forecasts for OTT platforms?
Weaver suggested PCs, of course, and said the iPad is looking good as is the iPhone and Android-based platforms. Content owners and producers must focus on content and not the platform.

Spiridellis noted that for small publishers, the 6 million iPads don’t even start to compare to the Web. Any platform must make it easy to port to it, otherwise, the economics don’t make sense. The platform can bury the business relationship. For example, xBoxnet adds $10 to get ESPN. The only way is through distribution deals. Now Facebook has open APIs and the Apple store is opening up, so developers don’t need to do 1 to 1 deals.

Kim added that even though Google TV has separate fees, it increases user time on a show, so the extras have value and increase viewer engagement.