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of video streaming
New software promises to deliver a better picture
By David Everitt
Video streaming continues to be a work in progress.
The idea of downloading moving pictures over the internet excited a lot of web developers a couple of years ago. Video clips have become a fixture on sports and news sites, but the crashing and burning of entertainment-video dot.coms made people a lot more cautious about the whole concept.
As video streaming still searches for its place in the media market, one company contends that a significant part of the problem is technical. The company has recently distributed a product for free that, the firm claims, will provide a solution.
According to Doug McIntyre, CEO of On2 Technologies, video over the net has suffered from a lack of visual quality.
"On some of the news and sports sites," he says, "even if you have a high-speed connection, the video doesn’t look especially good. And that’s because the compression software is not powerful enough. People are used to watching moving pictures on TV and in the movies, and they’re used to seeing a certain level of quality.
"That’s why you see almost no TV commercials on the net," he says. "Advertisers look at the quality of video streaming and they say, ‘Why should I take a commercial that cost $4 million to make and spend more money to make it look crummy?’ "
On2’s new product is a codec, an abbreviation for compression/decompression. This process compresses video into a small packet of data that can be efficiently transmitted to a person’s computer, where it is decompressed into its original, more expanded form, suitable for viewing.
On2 claims that its codec, called VP3, is more efficient than other, similar products. "Our algorithms allow for much higher-quality video streaming at lower data rates," McIntyre says.
The company has gotten an endorsement from Intel, which described the codec on its website as MP3’s "video counterpart."
Just as important as any technical advantages that VP3 may possess is the availability of the technology. Since September, anyone interested in the product has been able to download it for free. According to On2, nearly 10,000 software developers have downloaded the VP3 in that time. The company hopes that free distribution will help establish VP3 as a streaming standard.
McIntyre reports that advertisers have an interest in using the technology, but also points out that much-maligned entertainment sites have made use of VP3, including Warner Bros., which employed the codec for an online "Lord of the Rings" music video.
Not everyone believes that more efficient technology will revive entertainment streaming.
"Video streaming is not for couch potatoes," says Steve Vonder Haar, analyst for the Yankee Group. "Its best application is for video with a purpose, productivity applications."
He cites such things as sales training over the net or multimedia FAQ pages. He also believes there will be "a huge amount of activity" in video-streamed promotion and advertising.
"We think that, by 2005, there will be $3 billion worth of spending in this area, as opposed to $44 million in 2000."
Josh Wise, analyst for Allied Business Intelligence, is more cautious. "Using video streaming for promotion and advertising is a good idea," he says, "but I’m not sure the revenues are there to back it up. People like free stuff, and producing and transmitting this material would be costly."
One possible way to go, he says, is a subscription service that would allow consumers to get an early glimpse of certain products that are about to come out.
"A five-minute video-streaming clip filled with information could be valuable and also something that people might be willing to pay for. Take TiVo, for instance. When that first came out, people wanted to get as much information about it as possible."
On2’s McIntyre brings up a proviso of his own when it comes to video commercials on the net. He points out that more advertisers are interested in the technology now than a year ago, but that the collapse of the ad market is holding back the process.
"If the market had stayed robust," he says, "you’d see a lot more interest. New technologies in advertising tend to get undercut in times like this. Growth in this area will depend on the economic recovery."
January 10, 2002 © 2002 Media Life
-David Everitt covers technology for Media Life, writing from Huntington, N.Y.
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