Video Distribution Strategies in a Broadband-centric Future - Shelly Palmer Report

The following is an excerpt from a White Paper I recently wrote for Cisco You can download the entire document here There39s a short video presentation as well The idea behind this paper was to explore some of the issues that will face service providers like cable and IPTV as the world becomes more broadbandcentric1 Billy39s MomWhile 11yearold Billy R from Rock Hill SC played soccer his mother was just settling down to watch an ondemand movie at home The coach gave the kids a break and told them that practice would end an hour earlier than usual Billy sent his mom a text message that instantly showed up as an overlay on the flatscreen in the Living Room Billy39s mom grabbed her handheld to answer Ten minutes later she jumped in her car to pick up her son Arriving a few minutes early she continued to watch her movie on her handheld deviceamp8212right from where she paused it back in her Living Room When they arrived home Billy headed straight for the flatscreen to play a quadsplit firstperson shooter with three kids from other countries Mom finished watching her movie in the kitchenamp8212full screen on her PC This is one of a thousand usecases cited by the proponents of the quotWhat I want where I want when I wantquot media consumption future WiwWiwWiw pronounced weeweewee foretells a time in the not too distant future when everyone will live in a broadbandcentric interoperable ondemand content universeService Providers SPs have a tremendous amount of opportunity in a broadbandcentric universe There are at least three potential revenue streams subscription services advertising and transactions Plus SPs will benefit from the power of wireless networks the value of locationbased services and the true convenience and behavioral changes technology will afford connected consumers2 Consumer Media Consumption ParadigmGlobally each market has a unique media consumption focus Parts of Asia are mobile phonecentric others favor PCs still others are predominantly populated by television viewers In Europe satellite and cable are much more evenly split than they are in the US South America has a remarkably small paidtelevision consumer base But no matter where you look no matter what market you visitwhere there is broadband connectivitythe media consumption paradigm has changedOver the past few months consumers have demonstrated preferences for various types of vide consumption including quotvideo snackingquot quotdownloadtoownquot quotonline videoquot and video applications The adoption of these preferences combined with the advent of technology has helped the Internet quickly evolve into a mediacentric environment21 Consumer Video Experiences211 Video SnacksVideo snacks are a new art form which evolved in parallel with the social networking phenomenon In general video snacks are short and low resolution They are extremely inexpensive to produce or have been appropriated completely free of charge by the person who wishes to share them over the Internet The short durations of video snacks make them difficult to monetize with traditional television advertising units Consumers generally will not watch 15 seconds of advertising for each 45 seconds of online content212 Internet TelevisionInternet Television is a televisionlike experience over the public Internet You can find examples of Internet Television at abccom nbccom cbscom and foxcom In fact almost every major television network offers some kind of online viewing experience for their most popular showsMany believe that the limitations of the public Internet are simply antithetical to the distribution of highquality emotionally satisfying images to millions of simultaneous users They are wrong Live streaming capacity over the public Internet is equal to all but the very biggest shows in primetime John Edwards CEO of Move Networks thinks that 10 million simultaneous users are easy and that we can expect capacity of 20 million simultaneous streams in the near futureAlthough there is a clear distinction in terms of video consumption behavior between video snacking and Internet Television there is a fairly homogenous continuum between both Video content comes in a plethora of subjective and objective quality levels resolutions lengths and subjectsThis video content does not have a name that everyone agrees upon Most people just call it quotbroadband videoquot or quotonline videoquot For our purposes which is simply to silo a piece of video content to a particular value chain we can take short form videos and call them quotvideo snacksquot and longer form pieces which can be advertiser or subscription supported and call them quotonlinequot or quotInternetquot television The important issue is not what to call the content the issue is how the content is monetized now or may be monetized in the future with the advent of technology213 DownloadtoOwnDownloadtoown is a wellunderstood consumer behavior iTunes AmazonOnDemand and other downloadtoown or rent services operate under the assumption that consumers will be willing to pay for files download store and then view them Of course digital files are hard to protect from piracy People with more money than time buy and people with more time than money pirateDownloadtoown is often spoken of as quotthequot form factor that will replace DVDs for longform and evergreen video content This may well be the case The question is quotwhenquot214 Video OnDemand VoDWhether it is video snacking Internet Television or downloadtoown recent observations of the changes in video consumption lead to one overwhelming conclusionamp8212consumers like to consume video content and most importantly they like to be in control of their media consumption experiences This consumer trend shows significant inclination towards ondemand consumption So for SPs VoD has the potential to be the quotkiller appquot However it must evolveIt is worth noting here that the technology used for the first generation VoD product was poorly designed from a business perspective The idea that people would rather press a button and watch a movie than go to a video store was goodamp8212but the value chain was flawed The market price for a PPV movie was too low for Studios and too high for consumers And without an intelligence layer the system could not evolve to deliver televisionondemand or even help promote appropriate content based upon viewer behavior215 Video ApplicationsLastly it is important to consider video applications that are also having a significant impact on consumers webcams and businesses video conferencing As travel becomes more and more difficult and expensive you can expect twoway video applications to approach ubiquity in broadband environmentsVideo is everywhere and it is being produced and consumed at record levels Video is becoming more personal more interactive and more social Both production and consumption are trending upwards and will continue to do so indefinitely You can download the entire document hereShelly Palmer is the host of MediaBytes with Shelly Palmer a daily show featuring news you can use about technology media ampamp entertainment He is the author of Television Disrupted The Transition from Network to Networked TV 2008 New York House Press and the upcoming Get Digital Reinventing Yourself and Your Career for the 21st Century Economy 2009 Lake House Press Shelly is also President of the National Academy of Television Arts ampamp Sciences NY the organization that bestows the coveted Emmy Awards For information about Get Digital Classes visit httpwwwshellypalmercomseminars

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