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31

Technology and Marketing Views Clash over Video
by Aner Ravon

Thursday December 07th 2006, 9:35 am
Filed under: web 2.0, freedom, Aner Bio, mobile, user experience

I’ve been meaning to write about this for some time now when Gil Dibner forwarded me this excellent post by Michael Parekh. Michael’s philosophy is very easy to subscribe to. His view on Internet technology, if I may humbly try to purify, is that we over complicate it. The particles are more similar then different, it should be priced in a simple way and it should be controlled to the minimum.

Who wouldn’t agree with that? I do too, but I also find it a bit over simplified. I’d like to suggest another point of view to it. I think marketing is well ahead of technology and not, unlike I often hear, the other way around.

From A marketing perspective, we are there for a long time now. We all imagine converged media on converged devices. We all see the internet as a world wide communication infrastructure, free and open for all. We all see Access as something that should not be priced according to media types but, if anything, according to quantity of usage and quality of service.

From a technology standpoint, there is a huge difference between streaming and download, between Video and Photo, between Browsing and Voice. One that impacts everything. But I’ll get to that later.

Michael looks through the case of web and mobile video. As the case is usually with other technologies, we tend to invent and create categories instead of realizing it’s just more of the same:

“Every new evolution in technology at times is treated as “the next big thing” and a category unto itself. Today’s investor and media fascination with internet video as a separate category is a case in point.

Never mind that video is just an additional data type being made increasingly more mainstream by the on-going adoption of wired and wireless broadband access…. Some of you may be old enough to remember when “Multimedia” on CD-ROMS, was considered a separate technology category unto itself.

As an example, Ted Leonsis, an entrepreneur who focused on this category, successfully sold a company he co-founded called Redgate Communications to a little-known online company called America Online (AOL) in 1993, and ended up on a road to being a billionaire. Not unlike two young guys recently who managed to sell an “internet video” company to Google for over $1.6 billion.”

The danger with inventing categories is that players then look to reinvent the business and marketing wheels, generating half-ass-ed products and absurd business models:

“The reason I’m getting into all this, is that this tendency causes all kinds of short-term warping of business models, with adverse short-term consequences for mainstream consumer adoption. ”

If we treat video in a similar way to voice, for example, there should be no need to go through a pointless learning curve filled with unnecessary mistakes, such as the one demonstrated by YouTube and Verizon and referred to in another Michael post:

“YouTube is coming to mobile phones — or, to be more precise, a small slice of YouTube is coming to some Verizon Wireless phones.

While its explosively popular Web site is free, YouTube’s phone-based version will require a $15-a-month subscription to a Verizon Wireless service called VCast. And instead of choosing what to watch from a vast library of clips, VCast users will be limited to an unspecified number of videos selected and approved by the companies.”

I couldn’t have said it better myself. But Michael is overlooking an important point. From a TECHNICAL PERSPECTIVE, Video (and Mobile Video in particular) IS totally new technology. Like mobile browsing was new technology at first and exactly like Multimedia on a a CD ROM was new technology.

And this is key. Video streaming on mobile devices requires a set of new sub-technologies that are not yet fully present - reliable mobile broadband, good quality image processing, image compression, transcoding. Then come usage considerations that require a technical solution - creating the content base, taking care of content filtering, abuse reporting, DRM, performance measuring. following we have quality and integration issues - it must work well on many handsets, it must not crash the phone or the phone line….

I know I may sound like a techie right now, but these are in fact real issues. The marketing has long been figured out but the product is not there yet!

Very few companies have decent mobile video enabling platforms at this very point. None has standard support for DRM and Content filtering. There is an inevitable process of maturing and standardizing technology. How can one provide Mobile Video as “another multimedia component” when there are no mature, off the shelf, solutions that can create a competitive market and that can be easily bench-marked and integrated?

Finally, and that’s the sad part, comes the user. Figuring out the exact use cases, flow and required position with respect to adjacent products is a long, long, process. An expensive and risky process. This trial and error process is the one that ends up reshaping the industry more than anything else. We should ask ourselves why the user comes last and not first, but market forces dictate this realit. The only real way to push the user to the front is by building open standards and by creating a competitive environment.

This is another reason for why Google will not “just go mobile”. This is why Microsoft has been trying, without much success, to “go mobile” for over 10 years. This is why mobile operators, despite all the obituaries, are still in good control over the mobile user. From a marketing perspective there is “one internet” but from a technology and service perspective there are too many technologies, standards and products.

I see eye to eye with Michael when it comes to pointing fingers at the mistakes mobile operators are doing. It is also very frustrating to see them repeating themselves. Operators try to charge too much for too little and it always backfires.

I totally agree that the Verizon / YouTube deal creates much more noise then value to the end users. The Operators’ tendency to “nickel and dime” everything is indeed near sited and counter productive. However, it all results from the fact Operators are accountable for operating profit. Much more than VCs, Internet Companies and Content Providers.

As cynical as it sounds, in most cases it still makes sense for operators to try and charge before extending technology for free. Imagine Operators’ life without transactional charging of SMS, for example. Creating the environment took years of time and money. Without marginal transaction charging there would have been no standards, infrastructure companies, integrators, interoperability and wide range device support. There would have been no predictive text, ring tones and voting services. We all would probably have missed THE killer app.

Life is complicated. We tend to think it’s all politics but technology does take time to develop as well. While video maybe another media type, the technology is very much stand alone. Synthesizing technology, marketing and product - this is the challenging and time consuming element.

Aner Ravon

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