This document discusses trends in VoIP and video technologies and business models. It covers the history of VoIP including challenges like high subscriber acquisition costs and churn. Solutions discussed include personalization through avatars and social networks. Video trends include improved search and tagging to enable better advertising targeting. Financial issues in scaling up technologies are also examined, including revenue models, expenses, intellectual property rights costs, and development approaches.

1. VoIP & Video
Business Models
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2. Overview
• Challenges
VoIP • Solutions & Trends
Portal • Portal Video Challenges
Video • Solutions and Trends
Biz • VoIP
Models • Video
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3. VoIP Solutions and
Trends
VoIP status
VoIP Trends
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4. VoIP Status
PC VoIP History
PC VoIP by two parallel paths for personal and
business use:
•Enterprise Phone switches
offered PC VoIP extensions PC VoIP
•Large IM Portals offered VoIP
Personal Enterprise
VoIP VoIP
Upgrade IM Enterprise
Pure VoIP Phone
Client Clients Extension
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5. VoIP Status
Enterprise Personal VoIM
PC VoIP started as PC phone Large portals with IM
extension for enterprise clients started offering
•Avaya VoIM
•Cisco •Single Client IM
•Nortel •IRC, ICQ
•AOL AIM
•MSN Messenger
•Yahoo! Messenger
•Jabber
•Converged IM
Yack! •Meebo
•Trillian
•Gaim
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6. VoIPStatus
VoIP Challenges
• VoIP subscription fees are:
•None
•Very low per minute rates
•Low Monthly/Yearly Flat rate
•Client acquisition costs are very high
•Vonage–$150-200 according to CEO interview
•Offerings of “VoIP subscriber for sale” $ 200 per head
•Churn is very high
•No Differential factors: if I’m on a 19.99 flat package I
could turn to a different vendor for 18.99
•(Ask Vonage)
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7. VoIPTrends
VoIP Trends
Personalization All Platform New Models
• Avatars • Mobile VoIP • Pay Per Call
• Social Networks • Converged VoIP • Call-to-Expert
• Call statistics
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8. VoIP Trends
Personalization
Skype Offers Klonies
with Comverse
More Avatars by
• Combots
•WeeMe
•IDT
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9. VoIP Trends
Mobile VoIP
Usually free calls between subscribers PC over current
Portal VoIP networks
Lower than standard rates for mobile calls
EQO - Widget for MySpace for Mobile
Fring – Leading Israeli Mobile VoIP Company
iSkoot – Deal with Skype Mobile
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10. VoIP Trends
Messaging Convergence
Cerulean Studios’ Trillian Connects to
leading IM services:
•MSN
•ICQ
•Yahoo
VoIM convergence
•Farsight
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11. VoIP Trends
Connect to Expert/Service
Palore
• Call and rate services like
restaurants or plumbers
BitWine
• Connection to experts
Kasamba
• connect to expert, bought
by LivePerson for $ 40M
June 2007
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12. Video Trends
•Video overly advertisement
•Video understanding and tagging
•Media discovery
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13. UGCVideo Today
UGC Video Today
Is this the best
video delivery
system we can
create?
A $1.4B system?
Where are the
Videos I like??
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14. Video Challenges
Portal Video Challenges
• Revenues are mostly based on Advertisement:
•No Focus or Ad personalization per
Content
User
•Low CTR
Clients wants to see video and not buy Cola or a new phone
•High expenses
•“CDN costs are killing us”
•Personalization – Nada !
•Aggregated search mechanism - No
•Personal recommendations – No
•“Save” option
•Low stickiness
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15. Video Solutions
Solutions
•Specialized niche videos
• Example: 5Min, Café-Confidential in Metacafe
•Video overly advertisement
• Example: YouTube - August 2007
•Video understanding and tagging
• Examples: VeoTag, Blinkx
• Better Search results
• Better Advertisement targeting
•Social discovery web sites
• Discover people with the same taste
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16. Trends
Content Creates
Creator Content
Distributer Broadcast User
Content
Recommendation Systems Creator
close the loop between content
creator/distributors and the
users
Recomm.
System
Distribut
er User
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17. Video Solutions
Internet Video Trends
Process Past Present Future
Distribution Broadcast UGC / Pre defined My Customized
Pre defined channels channel
channels
Consumption Lean Back – open Lean Forward Lean back
loop Text search of clips
Content type Premium Content UGC content + UGC + Legal
Stolen Premium Premium content +
content Meshups
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18. Financial issues
in scaling
● Revenues models
● Expenses
● IPR Issues
● Development issues
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19. Revenueissues in scaling
Financial Models
• Advertisement
• Google, MetaCafe, YouTube and most of Web 2.0
services
• Subscription fees
• Business service – LinkedIn
• Content download - Rhapsody music service by real
• Per interaction model
• iTunes – per song payment ~ $1
• Guba – per video payment ¢45-99
• Requires attention to client retention
• Requires very low cost of billing handling (~¢1 )
• No revenue model – Exit
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20. VoIP and Videoscaling
Financial issues in startup scaling
Idea
Garage
+Alpha
10K users Web 2.0
development
Full scale
Commercial
commercial
Dev. + Beta deployment
100K users
Scaling
1M users
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21. Financial issues in scaling
Community oriented Startup
Create a Community
• Socialization Create
• Information sharing Communities
Community Bonding/Gluing
• Socialization and search tools
• Stronger relations and
interactions between Social
Service
community members
Bridging Communities
• Creating mutual interest spaces
• Bridging technological Gap
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22. Financial issues in scaling
Community Creation
Technology oriented
premium bridging services
Free Services Premium Services
•Goals •Goal
•Group creation •Revenues
•Group Scaling Bridging •border crossing
•Identity
•Presence – Mood
•Connection Bonding
•Personalization
•Basic communication
•Presence Community •Cross technology
services
•VoIP<->PSTN
•VoIP over Mobile
•Free WLAN
Community free services
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23. Financial issues in scaling
Expenses
What Should be the cost of the model?
What is the delta-expense between 1M and 10M
users?
• Linear
• Semi-linear
• Flat
Linear Cost
• IP and Patents for media coding and processing
Semi linear
• Support, Infrastructure
Flat
• Development costs
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24. Financial issues in scaling
IPR Costs
•As engineers we tend to see only development
•For large scale deployment, IPR (Royalties) are
the largest expense (ask Adobe and Skype)
•Payment for IPR:
• Codec Patent rights (G729, G723.1, MPEG4)
• Developer royalties for companies developing our:
• Signaling
• Multimedia codecs
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25. Financial issues in scaling
Ownership problems – 3rd Party IP
•Standard media codec and many algorithms used for
media coding are protected IP and requires payment to
patent owners.
•Although after the community is large enough there are
revenues from premium services, they do not cover IPR
costs
How to finance
this gap? Subscribers
Subscribers
IPR Costs
Revenues
Revenues IPR
Costs
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26. Development in scaling review
Financial issues Models
Deciding which option to choose affects the
development cost, scaling costs and TTM
Development Pros Cons
Internal Create IP for the company Time-to-market
No Royalties / 3rd costs Development risks
Development Large initial cost
Buy Time-to-market IPR if exists
Low initial cost Relay on other
(royalties) companies
No development risks
Outsource Low development risks Hmmm…
Time-to-Market
No Royalties / 3rd costs
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27. Financial issues in scaling
Project Mapping into development option
space
Development Outsourcing
risk Develop + Make/Internal
Time-to-Market
Consulting development
Long-term/IP
cost Buy
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28. Financial issues in scaling
Summary
•Pay attention to scalability and IP ownership issues
•Rapid Development
• Use open source for rapid prototyping and demos
• Buy or outsource whatever you can’t develop fast.
• Don’t get stuck because on technology issues
•Mix technological breakthrough, product features,
client behavior understanding and innovative GUI Technology
to get ahead of the pack
Biz Model
Scaling
Idea
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29. DSP-IP Contact information
Download slides at: www.dsp-ip.com
www.dsp-
Course materials & lecture request
Adi Yakov
Training Manager
adi@dsp-
adi@dsp-ip.com
+972-9-8651933
972-
Projects development services:
Alona Ashkenazi
Development Services www.dsp-ip.
www.dsp-ip.com
alona@dsp-
alona@dsp-ip.com Mail : info@dsp-ip.com
info@dsp-ip.
+972-9-8850956
972- Phone: 972- 8850956,
Phone: +972-9-8850956,
Fax : +972-50- 8962910
972-50-
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