Sean W. Crawford Director, Home Group, Business Development & Partnerships 6 things I think I think about video business models
Video sites draw users in numbers that rival cable or satellite co's.
107M Americans Viewed Online Video in July
Downloaded or streamed 7.2 billion video clips, 67 per user
21% share of video activities 17.9M Unique Visitors 37M Unique Users Less than 2% N/A 38M Unique Users 46% of visits to U.S. online-video sites (11% for Google) 34M Unique Visitors 31M Unique Users September August July 15.5 million U.S. subscribers 24 million subscribers
Revenues tied to UGC video are expected to exceed $850M by 2010
By 2010, the volume of downloads/views on these sites will surpass 65 billion,
The size of downloads/views are estimated to eclipse 1.1 exabytes of data by 2010, with uploads growing to more than 9.1 petabytes.
23% of the dozens of UCG sites studied currently support mobile access, with others making announcements for this support in the near future.
B2B UCC Ads Data UGC STB Subs Premium Mobile PC
1. There are multiple business models – no silver bullet
Some of those are siloed
Some are convergent
Some are bundled.
Some are connected to transport, some are not.
Some start with "free" as a core component.
Some are ad supported.
Some tie video back to communications.
Some have embedded models of control (is hoster on the hook for 3 rd party content passing through their servers or over their networks?)
2. Cross-platform business models are a starting point
Orange TV (subs+ads) + Orange Mobile TV is not very converged for the consumer
Let's beat "TiVo + Yahoo!" with a better UE and a better business model
Apple iTunes video model
VoD and mobile model
Stream to myself (Shishir and Sling)
Streaming my own content to myself is an indirect pay model in that I am paying for my content again by paying for the data stream. Does that revenue need to be shared with content owners? Falls under FairUse in the US.
3. Advertising is a key component to video
CPM high due to low inventory on both sides
Pre-roll, post-roll, overlay, on page (internet), on deck (on mobile)
Many online video sites are already sold out of inventory, due to a combination of high advertiser demand and a relative lack of customer impressions to sell. After meeting in late September with executives at Fox Interactive Media, RBC Capital analyst Jordan Rohan confirmed in a research note that MySpace, too, is sold out of video ad inventory and is commanding ad rates as high as $35 to $40 on a cost per thousand basis for premium programming.
Arti and Amit to talk about
$25 CPM on UGC video – is this sustainable as more ad inventory is created and more video inventory appears
Advertising supported UGC is legit
4. Online video users are worth $15-$20 each
Tech crunch – grouper/youtube
YouTube per user valuation at $1.65b sale
UCC has not and will not go away – how monetize in a way that studios can support (YouTube model)
5. Communications + video drives revenue
Vod, mobile, stb
Video, communities, communications, advertising
Media caddy model (recommendations)
InTouch model – UGC, communications, STB, mobile (show video?)
Studios and SPs that recognize consumers role in building and creating an audience are those that will prosper in the new environment.
MySpace driving video creation by offering prizes
6. Interent as the platform is giving headaches to cablecos, IPTV and satellite companies
In the near term, sites such as MySpace, iTunes or Google Inc. won't have a monetary impact on the cable or satellite companies, according to a recent study by Convergence Consulting Group Ltd., a Toronto media and technology advisory firm. But in the longer term, the online sites "do pose a threat," the study said.
A recent study from BIGresearch, an Ohio market research firm, showed that 70% of Web users watch TV "occasionally to regularly" while they surf the Web.
One area cable companies need to be vigilant, industry observers say, is with on-demand movies. Online distribution of movies could sidestep cable companies, which get a steady revenue stream from on-demand movie fees. Sony Corp., for instance, has mulled adding broadband capability onto its high-end high-definition TV sets, allowing consumers to download movies from Sony Pictures directly with their Sony sets.
CDN, B2B opps
Tie in to Ndiata preso
Concs & Recs
Focus on application convergence as well as network convergence
And this does not just mean bundling
Content should be available across devices
Sling, one subscription, PVR with download
Use online advertising platform to support Internet video, mobile video and UGC (regardless of platform)
Partner with top video players to bring communications services to theirs (push to mobile, push to STB)
Offer VoD and download models
Acquire Grouper-like site and add P2P expertise, communications, multiple networks and rights deals already in place
Still too skewed toward internet, incliude more iptv and mobile
How willk each fo these evolve?
Need usage stats (inStat, MCF (MFC?))
Satya to send comedy central clip
bInsert market demos
Advertising: page, content, user
Amit – Orange Powered Web video advertising and API business model
Arti – targeted and interactive video advertising
Sukesh, Ndiata – Grid, CDN and P2P
Shishir – Sling and place shifting of content
Reference companies coming in to speak
Add tracking bar on right side – vertical with various subjects being covered
Make preso inside a browser, make it look like a blog or video player, tv?
Viewing and creating video have become significant activities for U.S. Internet users, with 31% watching online videos at least monthly and 8% uploading clips to Websites such as YouTube
one-fourth of all Internet users own a mobile phone. Digital cameras, which often include video-recording capabilities, have nearly a 70% penetration rate in the U.S.
Enduring value of vaults and ownership
Long tail; where dead content gets re-born
DRM does not protect rights, it protects publishers
Valorize and stimulate fair use to its maximum limit – tie back to our network and devices to drive additional revenue.
1. Convergence is happening at the application layer
Yahoo! – TiVo
Apple with iTV, iTunes, iPod
Network management is not a cost of doing business or a differentiator
Television set as slide template
Last slide as grainy film close
Internet video player as template on some slides (press play to change slides)
Graphics and tables in Orange branding
3. Our competitors are changing
They are now Yahoo!, MSFT, Google, Apple, Sony
Not just Free, Cegetel, DT, Free, etc.
They think and move differently (and faster)
6. The value of the copy is waning
I'm thinking of a number between $1.65 billion and Google's current stock price... You guessed it--that's the value of YouTube.
Shortly after Google's announcement that it will acquire YouTube, execs from both companies participated in an investor conference call where they proceeded to dodge most questions and duck the specifics. One claim, however, that Google CEO Eric Schmidt made piqued my interest: "In the last 48 hours our engineers got together and came up with 20 or 30 different ways" that Google's technology could integrate with YouTube's. Well, you'd have to be a visionless Yahoo executive to think none of those were wireless related. Here's our take on the mobile angles in the YouToogle tie-up:
Google quietly acquired visual search company Neven Vision in August, which specialized in facial recognition technology for photos. Schmidt told a reporter from ABC news that the short-term integration will be all about search, while the advertising aspects of the deal "may not happen soon." It certainly will take a while to adapt Neven's technology to the video space. Let's not forget that Neven Vision's technology had been used in the past for mobile marketing purposes in an application called iScout, which reportedly allowed users to snap a picture of a movie billboard, send the picture to a special database that would then send them the movie's trailer. A mobile-accessible YouTube may be one such special database once Google begins to integrate it next year.
Google also teamed up with DivX in January to distribute DivX videos to mobile devices, so the company obviously has a documented interest in distributing videos to mobile--why not YouTube then? Release
As we've reported a few times in the last few days, T-Mobile USA recently announced that it wants to offer Web 2.0 services like YouTube and MySpace to its subscribers once it rolls out its UMTS network. Article
YouTube already allows users to upload videos from a mobile phone. As social networking continues to move onto the mobile platform and cameraphones boast more impressive resolutions, you can bet the video camera in your pocket will be a big generator of YouTube content.
And finally, Cingular has been promoting a contest for hopeful musicians on YouTube. The site features the promo video for the contest on its front page, so while it's not really mobile content, it looks like YouTube has already worked out one deal with a mobile carrier. Check out the video, here .
I'm excited to see how the mobile implications of this deal play out, but it's obvious to me that the seeds have already been planted. – Brian at FierceWireless