Moving Media


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Moving Media

  1. 1. TAPE – Preservation Workshop Digital Business Models – The Emerging Online Video Marketplace Simon Factor, Moving Media – Digital Video Labs Dublin – Los Angeles +353 87 6831176 [email_address]
  2. 2. Structure of Session <ul><li>Section 1: Archives Online – 20 Mins </li></ul><ul><ul><ul><li>Digital Markets – Enablers and Effects </li></ul></ul></ul><ul><ul><ul><li>Longtail – the decline of the Hit </li></ul></ul></ul><ul><ul><ul><li>Examples of Projects: Getty Images/Babelgum, Cousteau/Google, Pathe Archive Online </li></ul></ul></ul><ul><li>Section 2: Online Video Market – 20 Mins </li></ul><ul><ul><ul><li>Global view of online video consumption 2006 – 2011 </li></ul></ul></ul><ul><ul><ul><li>Who is watching, what are they watching? </li></ul></ul></ul><ul><ul><ul><li>Advertising revenues for online video, current and projected for various markets </li></ul></ul></ul><ul><li>Break for Discussion – 10 Mins </li></ul><ul><li>Section 3: Online Video Platforms – 20 Mins </li></ul><ul><ul><ul><li>What kind of platforms exist, what use are they to an archive? </li></ul></ul></ul><ul><ul><ul><li>Who are the key players and what differentiates them? </li></ul></ul></ul><ul><li>Section 4: Revenue Generation </li></ul><ul><ul><ul><li>Modes of revenue generation </li></ul></ul></ul><ul><ul><ul><li>Examples of online advertising products </li></ul></ul></ul><ul><ul><ul><li>Online Advertising Technology </li></ul></ul></ul><ul><ul><ul><li>Current Market Rates and Examples </li></ul></ul></ul>
  3. 3. Section 1: Archives Online
  4. 4. Digital Markets <ul><li>Enabling Forces: </li></ul><ul><li>IP Networks – The Internet </li></ul><ul><li>Audiovisual Compression Technologies </li></ul><ul><li>Conditional Access Technologies </li></ul><ul><li>Result: Disruption to traditional business models </li></ul>
  5. 5. The Changing Business Landscape <ul><li>Disruption to tradition models </li></ul><ul><li>Linear – Non Linear (on Demand) </li></ul><ul><li>Physical – Dynamic (file based products) </li></ul><ul><li>Disintermediation of physical distribution and transmission channels </li></ul>
  6. 6. The Changing Business Landscape <ul><li>Lower cost of delivery to end user </li></ul><ul><li>Alternative lower barrier to entry for smaller budgets </li></ul><ul><li>Niche interest channels provide clear alignment for advertising products </li></ul><ul><li>User generated content – a deeper engagement with the audience </li></ul><ul><li>Touch points within a digital archive are a source of intelligence </li></ul>
  7. 7. The Longtail <ul><li>Massive Choice equals Massive Demand </li></ul><ul><li>An economic model for digital businesses </li></ul><ul><li>The decline of the HIT </li></ul><ul><li>Many lower value items = 1 high value item </li></ul><ul><li>Exists in many businesses – particularly relevant to digital media </li></ul>
  8. 8. Why call it a Longtail? Quantity of Video downloads Mainstream / Hit Niche / Specialist
  9. 9. An Example of the Longtail Model
  10. 10. Getty Images on Babelgum <ul><li>700 items from the Getty Archive NY </li></ul><ul><li>Public Service Shorts/Three Stooges </li></ul><ul><li>Digitised to Quicktime MPEG 4 at MM Studios Los Angeles </li></ul><ul><li>Source 1”, UMatic, SP and Digi </li></ul><ul><li>Terms 1 Yr paid license / revenue share </li></ul>
  11. 11. Cousteau Archive on Google <ul><li>Location specific shorts </li></ul><ul><li>Part of Google Oceans project </li></ul><ul><li>Source material 16mm, 1”, 2”, UMatic, BetaSP </li></ul><ul><li>License based upon revenue share </li></ul><ul><li>Development of unique programming </li></ul><ul><li>In negotiation (2007) </li></ul>
  12. 12. Pathé Archive Online <ul><li>Pre Project online video use </li></ul><ul><li>100 users per month </li></ul><ul><li>7 hours of material viewed per month </li></ul><ul><li>Project - 3000 hours digitised </li></ul><ul><li>1,000,000 visitors in first month </li></ul><ul><li>7000 hours of material viewed </li></ul>
  13. 13. Section 2: Online Video Market
  14. 14. Key Notes on Online Video
  15. 15. European Web TV Use Spreads <ul><li>Nearly half of European broadband users watch TV previews or full episodes online, according to Motorola research. </li></ul><ul><li>The study found that six in 10 French broadband households watched Web TV. About half of Spanish homes watched TV online, as did 43% of UK households. </li></ul><ul><li>Almost two-thirds of Europeans under 25 watched TV shows online. Only 30% of those over 55 did. </li></ul><ul><li>The study also revealed that there were two or more PCs in 64% of UK households. About six in 10 German homes had two or more PCs, as did 54% of French households. </li></ul><ul><li>Karl Elliott of Motorola said that &quot;people downloading video want choice, which is why there is such a change in the marketplace.&quot; </li></ul><ul><li>Suggesting that watching TV online offered more options than traditional TV, Mr. Elliott added that &quot;200 channels [are] not enough because consumers want to take control too.&quot; </li></ul>
  16. 16. Who is watching? <ul><li>Men view video more frequently </li></ul><ul><li>Younger audiences are the most frequent users </li></ul><ul><li>Spain and France show the highest use of Online Video in Europe </li></ul><ul><li>29% of people access online video frequently </li></ul><ul><li>Another 38% have viewed online video but are not frequent users. </li></ul>
  17. 17. Who is Watching? <ul><li>Online video use is higher in Europe that the US - +10% for both sexes </li></ul><ul><li>In the US as in Europe Men are watching more online video </li></ul><ul><li>76% of US web users <30 are watching video </li></ul><ul><li>Correlation between education and online video use </li></ul>
  18. 18. What are they Watching? <ul><li>News is the most popular form of online video content for older viewers </li></ul><ul><li>Music videos most popular with younger people </li></ul><ul><li>Spain records a high level of movie watchers, Germany low – different attitudes towards copyright? </li></ul>
  19. 19. What are they Watching? News content is highest overall in US US market rates high for educational use (not polled in EU figures) Comedy and Music are next to News in popularity Overall US and European appetites are similar.
  20. 20. What’s it Worth? <ul><li>Revenue generated from the paid download of video content. </li></ul><ul><li>Target EURO 244 Million By 2009 </li></ul>
  21. 21. What’s it Worth? <ul><li>Online Advertising is a growing business </li></ul><ul><li>Close to 8 Billion spent in Europe in 2006 </li></ul><ul><li>Video is taking a significant share of online ad spend in 2008 </li></ul><ul><li>Overall ad seeded video will generate more revenue than paid downloads </li></ul>
  22. 22. What do people do with video? <ul><li>Very few will pay for video – only 7% of users in US </li></ul><ul><li>Young people use video more dynamically, by rating, posting and uploading twice as much as adults 30+ </li></ul><ul><li>Younger people are also more inclined to watch video with others </li></ul>
  23. 23. Section 3 - Online Video Platforms
  24. 24. Exploding Marketplace!
  25. 25. Online Video Services <ul><li>Destination Sites </li></ul><ul><ul><ul><li>UGC - Youtube, Daily Motion, Revver, Google Video </li></ul></ul></ul><ul><ul><ul><li>Online ‘TV’ – Hulu, Babelgum, Gofish, Joost </li></ul></ul></ul><ul><li>CDN Networks </li></ul><ul><ul><ul><li>Akamai, Limelight </li></ul></ul></ul><ul><li>Video Search </li></ul><ul><ul><ul><li>Blinkx, Veoh, Truveo (aquired by AOL) </li></ul></ul></ul><ul><li>Aggregators </li></ul><ul><ul><ul><li>WeShow, Feedbeat </li></ul></ul></ul><ul><li>Publishing Platforms </li></ul><ul><ul><ul><li>Brightcove, The Platform </li></ul></ul></ul>
  26. 26. General Differences <ul><li>Peer to Peer Sites </li></ul><ul><ul><ul><li>Pro: Lower cost of infrastructure </li></ul></ul></ul><ul><ul><ul><li>Con: Requires massive subscriber base </li></ul></ul></ul><ul><ul><ul><li>Need to download player – barrier </li></ul></ul></ul><ul><ul><ul><li>Walled Garden – content is not distributed to other points of contact </li></ul></ul></ul><ul><li>Streaming Sites </li></ul><ul><ul><ul><li>Pro – Content protection </li></ul></ul></ul><ul><ul><ul><li>Con – high cost of streaming infrastructure </li></ul></ul></ul><ul><ul><ul><li>Bandwidth limits quality </li></ul></ul></ul><ul><li>Download Sites </li></ul><ul><ul><ul><li>Pro - Lower bandwidth cost, can be throttled </li></ul></ul></ul><ul><ul><ul><li>Pro - Can deliver higher definition content </li></ul></ul></ul><ul><ul><ul><li>Con – not realtime, content is being copied – goes wild </li></ul></ul></ul><ul><li>Aggregators </li></ul><ul><ul><ul><li>Index video – host only metadata, link to video on source platform </li></ul></ul></ul>
  27. 27. Use to an Archive? <ul><li>Can limit capital expenditure in video delivery infrastructure for public access projects </li></ul><ul><li>Have scale to deal with flash demand </li></ul><ul><li>Have advertising and revenue sharing systems in place </li></ul><ul><li>Will pay for content </li></ul><ul><li>Can increase visibility of archive material – Video SEO </li></ul>
  28. 28. Video Streaming Sites <ul><li>YouTube has massive market share </li></ul><ul><li>In many cases myspace pulls from other sources such as You Tube </li></ul>
  29. 29. Site Example - Babelgum <ul><li>High quality encoding </li></ul><ul><li>Niche interest content channels </li></ul><ul><li>Peer to Peer </li></ul><ul><li>Player Download </li></ul><ul><li>Content distributed under (paid) license </li></ul><ul><li>Advertising share with content owner </li></ul><ul><li>Ad types, flash overlay </li></ul>Tech info: 500kbps MP4 H.264 Mono Audio @ 32khs/32kbps High Res version archived at 5Mbps
  30. 30. Site Example – YouTube <ul><li>No encoding standards </li></ul><ul><li>UGC – wide ranging </li></ul><ul><li>Central streaming architecture </li></ul><ul><li>Adsense – Google Adwords </li></ul><ul><li>Advertising share with producer channels </li></ul>Flash Player 9 Input formats vary/transcoding applied
  31. 31. Site Example - Hulu <ul><li>CNBC/NewsCorp </li></ul><ul><li>High quality encoding – HD Channel </li></ul><ul><li>Mainstream Broadcast and Feature Films </li></ul><ul><li>Streaming – Geoblocking for US only </li></ul><ul><li>Revenue Share Advertising </li></ul><ul><li>Ads are sponsor messages >4sec pre-roll </li></ul>Flash Player 9 @ 700kbps Stereo Audio at 56kbps
  32. 32. Site Example - Blinkx <ul><li>Video Search </li></ul><ul><li>Indexing video from various locations </li></ul><ul><li>Creates preview clips of files from other locations </li></ul><ul><li>Links to external video files </li></ul><ul><li>Proprietory ASR and Image Recognition technology </li></ul><ul><li>Banner advertising </li></ul>Flash Player 9
  33. 33. Site Example – 4OD <ul><li>Channel 4 On Demand </li></ul><ul><li>1 month Free </li></ul><ul><li>Charge on content screened +1month ago £1 docs - £1.99 for Features </li></ul><ul><li>Streaming to proprietary player </li></ul><ul><li>Geoblocked for UK/Ireland </li></ul><ul><li>Pre Roll Adverting </li></ul><ul><li>1 - 2 ads up to 25 secs duration – tend to be television ads </li></ul>Windows Media Player 410 Kbps
  34. 34. Section 4: Revenue Generation <ul><li>Cash Cow </li></ul>
  35. 35. The bad news… <ul><li>Only 7% of US internet users have paid to download video content </li></ul><ul><li>… ..and the good news? </li></ul><ul><li>Online video is grabbing a significant share of the $½ Trillion international advertising market </li></ul><ul><li>In 2010 online video will generate $2.9 Billion through advertising fees in the US alone </li></ul>
  36. 36. Global Advertising Revenues <ul><li>Europe is outpacing the US in growth </li></ul><ul><li>Central/ Eastern Europe is growing at close to 20% PA </li></ul><ul><li>EU and US markets subject to slower growth rates but have lions share of market </li></ul>
  37. 37. US Video Advertising Growth Online video is the drawing large amount of traditional ad budgets It is a very high growth area, revenues for online video ads have almost doubled in 2006 and 2007 Growth is levelling out at close to 50% to 2010
  38. 38. Sectors of Ad Spend <ul><li>Retail and wholesale trade accounts for the highest spend </li></ul><ul><li>Followed by Travel and Hospitality </li></ul><ul><li>Forrester research is close to eMarketer in terms of projection to 2010 </li></ul><ul><li>Growth continues at close to 50% through to 2012 </li></ul>
  39. 39. Types of Video Advertising <ul><li>Standard Ads: </li></ul><ul><li>Banners </li></ul><ul><li>Skyscrapers </li></ul><ul><li>Islands </li></ul><ul><li>Video Ads: </li></ul><ul><li>Pre Roll/mid roll/post roll </li></ul><ul><li>Overlay </li></ul><ul><li>Combinations: </li></ul><ul><li>Roadblocks </li></ul><ul><li>Companions </li></ul><ul><li>Sold as CPM units </li></ul>
  40. 40. Ad Revenues and Examples 1 <ul><li>Wall Street Journal: sells video advertising packages that run across the Wall Street Journal Digital Network, which includes,, and </li></ul><ul><li>Video ads offered: 15-second pre-roll 300x250 with companion ad, an expandable reminder unit that remains to the right of the video. </li></ul><ul><li>When a user clicks “Expand&quot;, the 300x250 unit displayed during the initial video pre-roll ad will reappear, enabling further user interaction. </li></ul><ul><li>Cost of Ads: $90 CPM </li></ul>
  41. 41. Ad Revenues and Examples 2 <ul><li>CBS Local CBS Local is a network of sites for the owned & operated CBS television stations that features 23 local Web sites reaching more than 10 million unique users per month. The network delivers more than 8 million monthly video views from more than 350,000 on-demand video clips. </li></ul><ul><li>Video ads offered: 15-second pre-roll video sponsor units, companion banner ads with message unit and video sponsor unit (different size ads on site) In-banner video unit (video inside a banner ad) Sponsored video sections </li></ul><ul><li>Cost of Ads: $50 CPM </li></ul>
  42. 42. Ad Revenues and Examples 3 <ul><li>MySpace </li></ul><ul><li>Video ads offered: Pre-roll,Mid-roll, 5-second pre-roll bumpers. Banners and display ads also live on pages with video </li></ul><ul><li>Cost of Ads: A pre-roll video in the music section of (15-second video with a 300x250 pixel ad unit) : $25 CPM. </li></ul>
  43. 43. About Moving Media <ul><li>Founded in 2003 </li></ul><ul><li>Specialise in high quality encoding of audio and video for internet, archive and broadcast projects </li></ul><ul><li>Technical consultancy services supporting digital video access and preservation projects </li></ul>RTE