Author: Philip

Categories
Distribution

Nearly a Year without Television

Well, last February when we moved from the West San Fernando Valley to Burbank, for a variety of reasons we decided to not get a cable or satellite TV service. Since we got cable for Internet there was no over-the-air antenna connected to our apartment either. (The cable is swapped from the Master Antenna for the complex to Charter to provide Internet.) I originally blogged about the experience shortly after we started. The announced release of Appletv is a reason to revisit the experiment to date.

Content has been coming from a variety of sources. Some, certainly, is purchased from Apple’s iTunes Store, but most is coming via a legally gray source: bittorrent, justified in my mind by the experimental nature of what I was trying to do. On the plus side, the quality is great and most shows I’ve wanted has been available. Most of the content is encoded with the DivX combination: MPEG-4 Advanced Simple Profile with MP3 audio in an AVI wrapper. This will not play on an iPod nor on an Appletv (to the best of my reading of the specs). To date Apple have only supported MPEG-4 Part 2 Simple Profile natively and officially that’s what’s supported on iPods and Appletv.

Another “plus” (for us, not the industry) is that we watch less TV. There’s no incentive to “just turn it on and kick back” because it’s a blank screen unless we’ve prepared content to watch. Missing from the bittorrent sites are any contemporary Food Network shows (Good Eats and Emeril were watched sporadically). Full seasons are available but mostly not until they’re published on DVD.

Overall, this isn’t something I’d recommend as a solution for anyone really. It’s not television, because television is easy and this is not easy. I have to find the torrent file, made somewhat easier by the availability of RSS feeds to monitor most of the shows we watch, download the torrent file and then wait for it to download. Shows like Comedy Central’s Daily Show and Colbert Report are usually available within 4 hours of air time on the East Coast (faster than they get to the iTunes Store btw) and are fairly quick to download (occasionally faster than real time, but usually an hour or two).

The shows have to be burnt to disc and played from a DivX/MPEG-4/DVD Player at the TV. All in all, quite clumsy. For the RSS fed stuff I could probably use the Democracy Player which combines RSS with bittorrent but I’d still have to burn to disc.

So nearly 11 months into the experiment, what I really want to do is pay for the content! Seriously, if the pricing was fair (more below) I’d much rather have the convenience of regular release and commercial download, not bittorrent. The trouble is, no-one currently offers what I want and that was the reason for going TV-service-less in the first place!

The sticking points are the lack of content availability (250 shows is narrow head, not even middle tail, let alone Long Tail) and pricing. Putting aside the first for the moment, as there’s nothing we can do about stubborn studios, pricing is a major sticking point.

Prior to the move, we spent $55 a month on a 100 channel Dish Network service, which includes 160 hours a week of Comedy Central, for which Comedy Central got about 60c per subscriber (as near as I can discover – correct me in the comments) but definitely less than $1 a subscriber.

And yet, using Apple’s Season Pass, just two shows – Daily Show and Colbert Report – will cost me $19.95 a month for (no offense) disposable television. We’re currently watching about 40 hours (TV hours) a month of programming. If all were purchased through the iTunes store it would be $59.75. Not much more than the Dish Network purchase, right?

Wrong. For Dish’s $55 a month I get access to (in theory) 640 TV hours a month, not 40. If we watched the average amount of 4.5 hours a day (130 hrs a month) that’s about $180 a month at the iTunes store for what we paid $55 to Dish. Something does not add up.

FWIW, I’d be happy to pay somewhere between 10c and 30c a show for the Daily Show and similar “disposable” (doesn’t bear a second watching) television and 50-75c for content that I’d watch more than once – produced drama and comedy.

The producers are cutting demand by pricing too high to be practical. Get the pricing in line, so my a la carte spend matches (or slightly exceeds, for convenience) my previous bill and I’d much rather pay money for a better service.

The one other place we’re getting content is from podcasts. VH1’s “Best Week Ever” is consistently, easily (and freely) delivered, as is Good Night Burbank, The Show with Ze Frank and some other favorites. But these “true” ISO MPEG-4 files are not supported on the DVD Player (just DivX’s proprietary format incorrectly labeled as MPEG-4) so we have to run cables when we want to watch these. For that alone I’d like the Appletv.

Categories
General

CNN article on HDTV making talent look fat!

This is the URL for the CNN article Does this HDTV make me look fat? mentioned during the BuZZ in Depth segment on the January 4th edition of Creative Planet’s Digital Production BuZZ.

Categories
General

What is it about “Innovation”

Microsoft constantly claims that any attempt to restrict (whatever it wants to do) will somehow “reduce innovation”. I’m hard pressed to remember any actual innovation that Microsoft have actually released. (The excellent Photosynthesis tech demo is indeed innovative but it’s not yet ready for market.)

Likewise I hear the big four record companies talking about “innovative ways to distribute digital media” when they mean Digital Rights Management destroying the features we already enjoy with their product – like being able to move it from device to device, computer to computer without having to remember to de-authorize one computer before starting on the next.)

Disney are “innovating” on MySpace by making a cosy little non-space that’s designed to please parents but has nothing going for it compared to the real Internet. If parents are worried about what their kids are doing on the Internet they should be parents and manage it, not rely on some walled garden that tries to isolate itself from the rest of the Internet: isolates itself from what makes the Internet actually useful.

So, I’ve come to the conclusion that “innovation” a really a code word for “we haven’t got a clue”. Another example is the Telecommunications companies who are “innovating” with IPTV by creating a poor copy (less choice, more lag time between channels, expensive infrastructure) of a cable system.

I’ve got news for them all: innovation means doing something new, different, unexpected, evolutionary, revolutionary. Triple-play telco bundling is not innovative. Doing a limited version of cable TV on IP protocols is imitation not innovation. What would be innovative is something that gave more choice, was easier to find programming you were interested in, wasn’t limited to a “broadcaster’s” schedule and wasn’t controlled by some channel or network gatekeeper.

That would be innovation. If it fails, better to fail at trying something new than the inevitable failure of poor quality imitation on an infrastructure totally unsuited for the purpose… I’m looking at you ATT Uverse and Verizon. High speed, high bandwidth symmetrical broadband is useful and will power the real innovation that’s coming in television delivery. But that’s not what the telcos are about.

They’re about imitation and convince themselves it’s innovation. How deluded do you have to be to work there?

Categories
Apple Pro Apps Interesting Technology

XML Article at kenstone.net

Ken Stone has released an article I wrote on XML in the Final Cut Studio. The article is What is XML and what does it mean for Final Cut Studio users?

Also, Steve Douglas reviewed my company’s Pro Apps Tips, also at KenStone.net in the Pro Apps Tips Review.

Just thought you’d like to know. Oh, and in 2007, I’ll be posting more regularly as I evolve some of the thoughts around a book I’m working on, tentatively titled “Television 3.0”.

Categories
Business & Marketing Interesting Technology

Why Revver Gets it

For those who don’t know Revver.com, at the simplest level it’s “yet another video sharing site” except it has two distinct differences: it has a revenue model based on advertising and it’s entirely driven by an API. Why are these distinctions important? They’re important because they essentially mean that Revver.com itself is irrelevant to their business.

Most “Web 2.0” websites are built on advertising support – Google Adsense at the simplest level, display advertising if they have an advertising sales force or by sponsorship. YouTube tried the latter – sponsorship of channels by the large content providers, or even “The Brittney Channel” and to are working on recognizing content and sharing revenue from advertising on the same page with the large conglomerates that own the content. Neither are innovative and both require the visitor to actually be on YouTube.com to see the advertising. Trouble is, one of YouTube’s greatest appeals is the embedded player which puts the content on another site (where the site owner could display ads and collect the revenue).

The use of embedded players or more commonly RSS driven technology is a problem for site owners looking to advertising-on-the-website models. As RSS becomes more widely adopted (because of the huge value add to subscribers) that tension increases. A site like creativecow.net or 2-pop.com requires visitors to be at the site to read their forums, tutorials or other content because that’s what pays the sites’ expenses and provides a return to the owners. This is a huge problem for content creators if podcasts/video podcasts, which are RSS driven, takes off.

If RSS/embedded players become successful, as they inevitably will because they provide the biggest payoff to the user/viewer, then the website becomes irrelevant, even dead. That’s why Revver’s model shows they understand the direction the web is taking. Revver provides a very comprehensive API so anyone can set up a full Revver.com clone, or customize content out of Revver’s collection to a subject-specific site. Revver.com is built on the same API and (with few exceptions) anything Revver can do on their own site, can be done on any site, without any “permissions” required from Revver.

This is because Revver serves up ads at the end of the video. The revenue from the ads is shared with affiliates (anyone using the API to drive traffic) who get 20% and the balance is split between Revver and the content provider. Ads are short and unobtrusive and pay on click through, not on ad impression.

So, it doesn’t matter how people use the content, wherever they use the content – either through an embeddable Flash player or through downloads (or even if the content is aggregated into an RSS feed) all parties still benefit and there’s no “must drive traffic to website” model involved.

In my (probably not so humble) opinion Revver is one model that will sustain. The other would be direct payment between viewers and content owners in an RSS-driven (Podcast/Video Podcast like) feed. But that model doesn’t exist until klickTab.com launches.

Categories
Item of Interest

Digital Production BuZZ featured in Radio Times

I just heard that Dave McCandless, a UK media pundit, has featured my weekly broadcast/podcast Creative Planet’s Digital Production BuZZ. The Radio Times has a circulation of just over 1 million. The brief article is available online if you’re interested.

Categories
Business & Marketing Distribution

Second thoughts on YouTube

So, Google bought YouTube in an all-stock transaction. Did not see that coming. In fact if you look back at my last post on the subject, I ruled Google out because it already had  Google Video of its own that seemed a competitor to YouTube. Still, I wasn’t the only one who got it wrong.

So, what of the substantative issues: copyright infringement and potential revenue? Well, it seems that YouTube were already on the way to solving part one of that conundrum, as their recent content agreements have shown. As part of these agreements, ostensibly to put up promotional videos, YouTube has promised to “quickly” develop technology that will search out and identify copyright material, but not to take it down. Instead, what is planned is that YouTube will identify, for example, a video with a Warner Music soundtrack and beside that video, place a Google ad. The ad revenue would then be shared with the copyright owner.

A neat solution to a seemingly intractable problem: YouTube stays in operation, the videos stay up and the copyright owners share in the revenue. Part of the deal is also a “don’t sue us” agreement. If YouTube can do enough of these deals, the copyright problem goes away.

Otherwise, Google is no stranger to copyright litigation and will fight the suits the way they always have. Some have speculated that the reason YouTube will be kept as a separate entity is to keep the suits in YouTube leaving Google untouced.

So, now the deal’s done, what changes? Not a lot really. Chad Hurley and Steve Chen are America’s newest paper millionaires. Since the deal was all-stock they will have to wait to cash out as there is usually a waiting period for these kind of deals. For Google, the $1.65 billion in stock to be issued seems to be handily covered by the short term rise in their stock price after the deal was announced. A rise that added $6 billion to their market capitalization over the week. A handy premium on the deal and one that arguably could be already “in the black”!

So, with 20/20 hindsight do I want to rethink the problems I had with anyone purchasing YouTube? Given that Google CEO Eric Schmidt is not stupid it’s only reasonable that I try and see the value that he sees in the deal. Particularly since with that much money Google could have purchased the New York Times with arguably more valuable advertising real estate and more visitors (if not more page views). In the linked article Susan Mernit puts forward the arguments why Google did not buy the New York Times.

My first thoughts were that $1.65 billion was a lot to pay for, basically, a platform to put ads on, because after all Google is an advertising company. It is a lot of money to pay for an advertising platform, but with law suits in a “manageable” position Google may actually turn an operating (as opposed to stock) profit on this deal. When you consider that the three major networks bring in $5-6 billion a year in advertising revenue each there’s a lot of advertising dollars around. A lot of those dollars are going to leak from network television to the Internet and frankly Google has the majority of Internet advertising dollars sewn up.

What’s also important to note is that YouTube has almost zero cost of content, although heavy bandwidth bills and about 65 on staff. YouTube’s content is created by visitors to the site or by the networks themselves, which is why the advertising revenue sharing deals noted above are so crucial to YouTube’s survival. It is plausible that sufficient advertising revenue will come in over the next five years to justify diluting the stock by $1.65 billion worth of shares. (Ironically, the increase in share value this week will reduce the number of shares that are issued to fund the deal as the deal was predicated on the dollar value, not number of shares.)

Getting in bed with Google’s bandwidth deals will lower YouTube’s overall cost of delivery (when existing agreements run out).

So, while I’m still uncertain about the wisdom of the deal, it’s not totally crazy.

It will have very little impact in the distribution of commercial video. Google retains their own Google Video play, complete with commercial video for sale in that store. Although it’s not well regarded maybe they can learn a few tricks from the YouTube folk. YouTube will still be a place to be seen, or to have your video seen and where a viral hit can get you massive exposure, such as people like Judson Laipply (now viewed over 5 million times) or David Lehr who I interviewed on Creative Planet’s Digital Production BuZZ back in April 2006. Getting a break out hit is a definite career builder.

Despite being the new “waitress discovered in a coffee shop” for producers and performers, YouTube has little to offer people who produce video professionally, or who have any hope of repaying investors (beyond posting a trailer, which should be mandatory).  The real developments in that arena are yet to come.

So, on the balance, I still think $1.65 billion, even if it’s only stock, is a lot to pay for a loss-making, two year old (not quite) startup, it seems Eric Schmidt may only be smoking the cheap stuff and not really wacked out!

Now the talk is Yahoo buying FaceBook for $2 billion!

Categories
General

MXF at 25P and 50P

This post is from the BuZZ show of September 21 where links were mentioned in the Pick our Brains segment. These are the links.

720 50P Capturing and Editing in Final Cut Pro

720 25 or 50P, workflow with Final Cut Pro

Categories
Business & Marketing Distribution

Who’ll buy YouTube?

I can’t help but feel we’re in another dot-com-like bubble: MySpace sold to Fox Interactive for $600 million and now YouTube’s founders are being coy saying that they “don’t think it’s worth $1 billion” but that they’re OK with $600 million.

Ok, now I don’t have a fancy MBA, and it could be that I’m a hick from Newcastle in Australia but YouTube, for all its popularity (and it is popular) has absolutely no business model. Apart from a few google ads on their site, they have no income. Conservative estimates are that serving up five million videos a day (or however many it is this week) costs the site over $1 million a month in bandwidth bills alone leaving out server costs, office space and salaries. The $11.5 million they’ve raised from Sequoia Capital in two rounds ($3.5 and $8 million) isn’t going to last long before the business just stops. At least MySpace generates some income to justify its $600 million purchase price – and even that was treated with raised eyebrows at the value.

Now this week, ZDNet’s Russell Shaw posts “One of these six companies will buy YouTube” and I have to explode somewhere. Why the heck would anyone buy an opportunity to spend a million dollars a month for $600 million dollars with no chance of recovering the investment or ongoing costs?

“But Philip”, you say, “you’re missing the point. In a big company there are synergies that will help them make money.” That may be so, but we’ve heard that line before and the “synergies” between Time Warner and AOL don’t seem to have been that useful. That’s just one example – in general the so-called synergies don’t pan out and someone just loses a bunch of money, while the founders walk away rich. I’ve got no problem with Chad Hurley and Steven Chen walking away with a good portion of someone’s $600 million dollars (after Sequoia take their share). People win the lottery every day.

It’s the mindset/lunacy/sheer stupidity of whoever buys it that I just can’t fathom. The six sites that ZDNet thought might be in the market are Adobe, Time Warner/AOL, Sony, Google, News Corp/Fox and Yahoo. Adobe does not need a showcase for Flash when YouTube and Google Video are already doing that for them, and Time Warner just started its own video sharing site on its AOL property with a “community reporter” video upload site at CNN. Google have Google Video and Yahoo just launched Yahoo Video, neither of which is as popular as YouTube but they didn’t cost $600 million either!

The problem that any large company would have, if they purchased YouTube, would be that they either have to kill YouTube as it is, or fight many long and tedious (and expensive) law suits. YouTube today is popular because it’s full of copyright material uploaded by people without rights to upload it. The copyright owners generally do not approve. A couple of shows, like The Daily Show and Colbert Report have said they have no problem, but most networks and program producers have a problem with it. Even with YouTube’s policy of removing copyright material as soon as it’s pointed out to them, they’re still being sued by an LA-based producer for copyright infringement. (That suit is unlikely to succeed but doesn’t really help YouTube’s new owner.)

When you have an owner with deep pockets – NewsCorp, Sony or Yahoo – the law suits are going to come out of the woodwork and YouTube will have to remove all copyright material without clearances. There goes most of the appeal and value. In order to make some money back, there are two solutions: charge for the download, or add advertising.

Either, or both moves will kill the site’s appeal. What are they going to charge for a 37 second video of some dog biting their male companion in a sensitive spot? It’s not going to be $1.99 that’s for sure. How much advertising can you add to the head, or tail, of a 2 minute video before everyone abandons the site completely?

Personally, I don’t see a way out for YouTube. It’s a temporary phenomena that is too good to be true, because it doesn’t follow the basic tenets of business: income has to (in some way) exceed expenses.

No doubt someone will buy it for some outrageous amount of money – maybe NewsCorp want to add it to MySpace. Sony would want to put root-kit, computer killing DRM around it.

But when they do, I still won’t understand what the business model is nor why it’s being brought.

Categories
General Item of Interest

How to protect the Internet from Politicians

The latest bit of insanity in legislation (part 654 in an ongoing series) has Rep. Michael G. Fitzpatrick (R-Pa.) brining up a Bill to “ban Myspace.com from schools” in order to “protect the children”. Leaving aside the facts that parents are where the responsibility lies, and that, given the 80 million members, MySpace is safer than the school itself because more teachers have been convicted of molesting children than has ever come via MySpace or equivalent, this piece of extreme stupidity once again proves that Legislators don’t seem to have any idea of anything regarding the Internet.

Fortunately this piece of lunacy is unlikely to go beyond grandstanding by Rep. Fitzpatrick, but if it did the “Deleting Online Predators Act” would be devestating for the Internet because it’s badly drafted and way too broad. If Wikipedia were commercial it would not be available in schools or libraries. And, just btw, MySpace and equivalent social networking sites now cover half the Internet’s users.

I say every legislator in every assembly should show a working knowledge or the subject before they’re allowed to vote on, let alone draft, legislation.