Viodi View – September 28th, 2005 Issue – Go to Viodi.com and Viodi.tv for current posts

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Viodi View Newsletter – September 28, 2005

Indie Telco Local Content Workshop Advertisement

By Ken Pyle, [email protected], Managing Editor, Viodi View

Should Telcos Be Implementing IPTV?
Look Ma, No Headend – the Shootout
Some Wisdom from Digital Hollywood
Artists Abound at Digital Hollywood
Google – The Online PVR?
Hard to Believe – But Not Everyone Is Addicted to the Internet
USDTV – The Next Competitor?
Google Fi
Congratulations
Conserve Energy – A Telco Opportunity?
The Korner – Maybe Personalization Isn’t Such a Bad Idea

Should Telcos Be Implementing IPTV?

Are telcos doing the right thing by building the massive infrastructures that are required to support IPTV? This question has been bothering me for a couple of years and, from what was said at last week’s Digital Hollywood, the emergence of these video Vonages should be factored in when building a business case for IPTV. Roger Bindl summarizes the many new choices that are available to customers in this issue’s video, where he shows how people can use the Internet to create their own ala-carte video offering.

Click to Watch Video

I posed this question to the panel titled, Internet Video, Advertising and Marketing: The Next Generation of Consumer Reach. The response from Jeremy Allaire, Founder, Chairman and President of Brightcove, an online video content community, was met with laughter when he suggested that telcos will build out video networks, fail and then will want to partner with Brightcove.

Look Ma, No Headend – The Shootout

I am not saying that telcos should not deploy IPTV or video services. In fact, they need to have a strategy to diversify their revenues away from voice and broadband only. The question is how best to implement video services. The answer to this question will be different for every telco. One approach that is beginning to get a great deal of attention are the new generation of satellite content aggregation services that promise to greatly reduce the cost and time to market for an independent operator.

In conjunction with Telecom 05, Viodi has put together a panel of all of these leading edge providers. Moderated by industry consultant Charles Jablonski, formerly of Myrio and NBC, this is sure to be an entertaining and educational panel. Click here to learn more about this and the other panels that Viodi is organizing at Telecom05.

Some Wisdom from Digital Hollywood

It is clear that the “over the top” video concept is becoming reality. The big talk at Digital Hollywood was the concept of download to own, where consumers can purchase content via the Internet. In this scenario, customers can burn the content to a DVD or, in the case of Akimbo, store the content remotely on servers in what Akimbo terms, “virtual shelves.” This and many other observations of Digital Hollywood can be found by clicking here.

Digital Hollywood is too much to cover alone, so here are some useful links covering different aspects of this useful conference.

Marty Lafferty, CEO of the Distributed Computing Industry Association, provides a good summary of what was discussed in the session regarding Peer to Peer content delivery. Marty will be moderating a panel on Peer to Peer at the IP Video track of Telecom05. Peer to Peer technology could provide telcos with some interesting content distribution options.
Based on yesterday’s Senate testimony from Sam Yagan, President of MetaMachine (makers of P2P file sharing program eDonkey), the legal precedent from the recent MGM vs. Grokster decision could freeze innovation by U.S. technology companies in this important technology. Yagan makes the point that the market will ultimately rule and that the technology development will be done offshore, as evidenced by Skype.
Joyce Schwarz moderated a very interesting panel that included, the comedian/cultural expert Sinbad. Sinbad was the best panelist I have heard in years. He provided some of the best insight I have heard regarding how people want to consume media. Of course, it was done in a very entertaining way. Joyce does a great job of summarizing her panel in her blog and writes of, “the five trends to thrive, not just survive in next generation entertainment and media.”

Artists Abound at Digital Hollywood:

One of the best things about Digital Hollywood is the face to face networking it provides. It is the random encounters with people that are probably the most valuable. While I was standing in line to meet Sinbad, I met a singer/businesswomen who is part of the legitimate P2P revolution being fostered by the DCIA. Glenda Benevides’ label, Good Witch Records, uses the Internet to promote and distribute music that otherwise might not have an outlet.

Another artist I met was a fellow named Mike Browne. Browne has a company called BigRedShoes.com. His is a web design firm that has does some created some pretty nifty looking web sites for other groups. One of his sites is called dinky.tv, which is a video channel for mobile phones. He has built a library of characters and is producing short and humorous animated videos that spoof current events. The point is that the technology is allowing creative people to bring their artistry directly to their audiences; unfiltered by corporate middlemen.

Click to see DinkyTV demo

Google – The Online PVR?

Talk about direct to the customer, what UPN is doing with Google and the new Chris Rock show, Everybody Hates Chris is truly revolutionary. I watched the pilot while writing part of this newsletter. What is amazing is that it is streamed commercial-free. It is a bit jerky the first time through, but that is no surprise given my 350 kb/s connection. The Google player loaded up immediately, no software download was required and it played within the Mozilla Firefox browser. It is a progressive download, so once content had been downloaded, it was possible to rewind and the aforementioned jerkiness went away. As suggested in Viodi’s Network PVR Report, one way the Network PVR might become widespread is via the Internet.

I have not been able to contact UPN to determine whether this is a one-off promotion to build excitement for the show (this is a show that looks like it could have some legs) or if this is something that will be done on a regular basis. It definitely bypasses the cable operators and their PVR efforts. I suspect that UPN is looking at the long term and looking at ways they might be able to monetize this effort through advertising, special sponsorship or premium fees. In those cases where a programmer or content provider wants to charge for their programming, Google would essentially serve as an online DVR and would probably be the one collecting fees for a variety of different programming. Working through the rights issues with the various performers, musicians and composers and scriptwriters will probably be the biggest challenge they have in making this a widespread offering across multiple shows and networks.

Hard to Believe – But Not Everyone Is Addicted to the Internet

The Pew Institute came out with an interesting study last week suggesting that it is getting more difficult to convert dial-up customers to broadband. As significantly, the number of Adult Americans who do not use the Internet is estimated to be 32%. It was suggested that the costs of broadband for these Internet “nevers” goes beyond the cost of the service, but also includes the equipment investment (e.g., PC) and having a social infrastructure to provide viral marketing and provide informal support. This makes sense, as independent Telcos have already found that they can increase their broadband penetration by offering bundles of voice, Internet and video. It is conceivable that an inexpensive, easy-to-use Internet-connected set-top box with access to loads of video content at a reasonable price could be a driver for Internet service for these Internet holdouts.

USDTV – The Next Competitor?

USDTV could be an interesting complement to a Google Internet PVR and, potentially, could provide a package targeted to the Internet “holdouts”. By using unused channels in a broadcaster’s digital spectrum, USDTV could provide another way for cable and broadcast networks to bypass the cable, Direct Broadcast Satellite and nascent IPTV competitors. With their $19.95 per month offering for around 30 digital television channels, they definitely represent competition at the low end of the market. It is not to hard to imagine a hybrid set-top box that combines the USDTV service with the Google Internet PVR. Club Viodi members, click here to some more thoughts on USDTV and how it might be complementary to Independent Telcos.

Google Fi

At the risk of making this issue all about Google, another piece that caught my eye was an article in eWEEK.com [Google Edges Toward Telco Territory] about Google’s supposed effort at creating a WiFi network. Reports about Google purchasing/leasing dark fiber have been on the Internet for several months now. This is the most comprehensive article on Google’s plans that I have seen. A network like this could conceivably allow Google and its video partners to bypass ISPs of all stripes. Granted, with WiFI or even WiMAX, they might not be able to reliably stream video, but they could do a great job downloading, while their broadcast partner(s) (e.g. UPN) could send live programming via traditional broadcast methods.

Congratulations

To Urban Telephone and Video – An article [free account required to view article] I should have written is one recently published in DV about the efforts of Urban Telephone and Video to bring Fiber to the Bronx. Although not an independent telco in a traditional sense, the founders, Stu Reid, Lawrence Hackney and Doug Frazier, represent the independent spirit and the entrepreneurial drive that is the engine of the U.S. economy. They have persevered through countless challenges as they went about creating one of the most advanced, facilities-based last-mile communications networks in the world.
Congratulations to First Mile.us for the addition of Internet pioneer, Vinton Cerf to their board of directors. Cerf also recently joined Google where he is the Chief Internet Evangelist.

Conserve Energy – A Telco Opportunity?

President Bush asked Americans to conserve energy due to the recent events in the Gulf Coast, according to an article buried on page 7 of the September 27th issue of the San Jose Mercury. This should have been the front page headlines for so many reasons [the irony is not lost on me that I am critical of the Mercury for burying it in their newspaper, while I am putting this in paragraph 17 of this online fish-wrapper].

I am doing my part by taking the train to the CTIA show in San Francisco. [Ironically enough, as I was waiting to catch the bus this morning, I met a young lady who had to evacuate her home in New Orleans. Hers was an interesting story as she was rescued by a boat, spent overnight on a bridge, and spent a few days in the convention center.] I am finding the train to be a great place to work on the Viodi View.

Last year, I had some ideas as to how Independent Telcos could build upon an energy conservation theme. To see some of those thoughts, please click here [must be a Club Viodi member].

The Korner: Maybe Personalization Isn’t Such a Bad Idea

It was just another security line in another nameless airport, reported a friend of mine last week. Focused on returning home for the weekend, he did not notice anything amiss as he reassembled his personal items. It is when he arrived home and fired up his lap-top, that he realized some thing was wrong.

His first reaction when seeing the start-up screen was that his system administrator had remotely changed the log-in information. Then he realized that he had accidentally swapped computers with someone at the security check-in. Unfortunately, he could not identify the owner of the lap-top, as there were no distinguishing identification marks, other than a log-in name.

Around the same time and, about a two-hour drive away, another road-weary traveler turned on her lap-top, only to discover she really had my friend’s lap-top. Fortunately, my friend’s log-in was his email. She sent my friend an email and they were able to meet and swap lap-tops. My friend reports that he has since affixed a business card to his lap-top to prevent this sort of mix-up from happening ever again.

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