Young Adults Hit Online Video Sites

"Did you see the new video on YouTube?"

If you heard that question a lot last year, there's a reason.

Nearly half of Internet users surveyed in December 2007 said they had visited a video-sharing site such as YouTube, according to the Pew Internet & American Life Project.

That's up from the year before when one-third of Internet users said they had visited such sites.

"The fact that younger Internet users are far more likely to be regular visitors to video-sharing sites points to a fork in the road,” said David Hallerman, senior analyst at eMarketer.

YouTube usage generally increased in 2007, according to Harris Interactive data released at the same time as the Pew study.

But while many Internet users have dipped their toes into the video-sharing pool, a solid majority of YouTube users surveyed still said they had visited only once or a few times.

The Pew study also captured demographics for active video-sharing site users. As might be expected, they skewed younger.

"On the one hand, marketers looking to target the under-30 demographic can more reliably find them on these video sites.

"On the other hand, the door is open for big content providers—mainly the TV networks, both broadcast and cable—to bulk up their online offerings, both in quantity and quality," Hallerman said.

He also said that such counter programming could help attract the over-30 audience, which is accustomed to traditional TV content.

Such content could draw ad dollars from marketers who want online-video ad inventory that is consistently appropriate for marketing, as opposed to a lot of user-generated content found on video-sharing sites.

Link to eMarketer Article

Deloitte: Nearly Half Of U.S. Consumers Frequently Create, Post Content Online

NEARLY ONE-HALF OF U.S. MEDIA consumers are frequently creating online content for others to see, according to findings of a new survey commissioned by Deloitte & Touche USA LLP. The finding, scheduled ot be released in detail at the Consumer Electronics Show in Las Vegas this week, marks a 12 point escalation from a prior survey commissioned by Deloitte in the spring of 2007, challenging the conventional assumption that online content creation is limited to a niche group of technology-savvy individuals, the company said.

Link to MediaPost Article

Take LonelyGirl, Ship Her to the U.K., Add Brands

Result: 'KateModern,' Online Show That Invites Marketers to Get Into the Drama

"KateModern," an online drama from the makers of "LonelyGirl15," is already a whole cyber-generation ahead of predecessor Bree and friends

The London-based show (the title is a play on the name of one of the city's art galleries, the Tate Modern) fully exploits the commercial opportunities of the internet, unlike Kate's more reserved forerunner, who found fame without sponsors in what now seems like a quaint, old-fashioned, unbranded world.

Microsoft Corp., Disney's Buena Vista International, France Telecom's Orange, plus Procter & Gamble's Gillette, Pantene and Tampax brands were all launch partners for "KateModern."

Backlash against backlash
Hewlett-Packard and Paramount also have signed up as sponsorship partners since the series began July 24 -- all a big contrast from "LonelyGirl15's" Thanksgiving episode, when branded items on the table were turned to face away from the camera because the show's producers thought the audience would disapprove of commercialism. In fact, there was a backlash against the backlash -- people liked Bree and wanted to know what brands she consumed and where she bought her clothes.

Three weeks into the show, Microsoft extended its partnership with Bebo, the U.K. social-networking site that hosts "KateModern" and premieres each episode (it is also shown on YouTube and LG15.com). "KateModern" is now available on MSN in the U.K., and Windows Live instant messaging has been integrated into the Bebo site.

In the first three weeks, "KateModern," a drama about a troubled young art student and her three closest friends, has registered 3 million views and is building an audience quickly -- the first episode was seen by just 23,000 people.

Audiences play an integral role in influencing the plot, and all the characters have their own social-networking profiles where they respond to e-mails and messages. Like "LonelyGirl15," "KateModern" integrates puzzles and clues into the storyline.

"KateModern" is being hailed as a new and sophisticated way for marketers to reach consumers via the internet. The product placement, for example, doesn't take itself too seriously: Disney's new movie, "Hallam Foe," is integrated into the drama's plotline via a cardboard cut-out of the lead character. One of Kate's friends, Gavin, fools around with it in his office, pretending to be Jamie Bell, the film's star.

Product placement opportunity
Mr. Bell also appears in person in an episode where one of Kate's friends runs away from him in a pub. It has been the most-watched episode so far, with 200,000 views. This is particularly significant in a country where product placement is still banned from TV.

Bebo's international-sales director, Mark Charkin, said, "With 'KateModern' we are trying to create a lot of dimensions for brands to relate to consumers. We can use the natural interactivity that is taking place as long as we do it well and remain authentic. It feels like we are defining the future."

For example, Gavin also downloads a "Hallam Foe" skin to his profile on Bebo, talks about the film on his own blog and links to the film's profile page.

Mike Jefferies, operations director at Tribal DDB, London, sees even bigger implications for show's success. "I like the way brand owners have got onboard. ... It's so bite-size and right for the platform," he said.

Link to AdAge Article

The Best Way To Search Videos On the Internet

August 22, 2007; Page D1

Some fascinating results can be produced when you scour the Internet using a giant search engine like Google's. You can discover the seedy past of a creep you might have otherwise dated, find directions to the nearest Thai restaurant, or instantly learn how many inches are in a mile (63,360).

But searching for video, the hottest content on the Web right now, isn't easy. Sure, you can go to Google's popular YouTube site and look for clips stored there. But that won't find videos from other sites, especially copyrighted clips that YouTube doesn't offer or has removed from its site.

This week, I tested four video-search engines, including revamped entrant Truveo.com, a smartly designed site that combs through Web video from all sorts of sources ranging from YouTube to broadcasting companies. Truveo, a subsidiary of AOL, is stepping out on its own again after spending three years in the background, powering video search for the likes of Microsoft, Brightcove and AOL itself. It unveiled its new site last week, though I've been playing with it for a few weeks now.

Truveo organizes search results by grouping clips together and spreading them out in a smart grid-like display.

This Web site, www.truveo.com, operates under the idea that users don't merely search for video by entering specific words or phrases, like they would when starting a regular Web search. Instead, Truveo thinks that people don't often know what they're looking for in online video searches, and browsing through content helps to retrieve unexpected and perhaps unintended (but welcome) results. I found that, compared with other sites, Truveo provided the most useful interface, which showed five times as many results per page as the others and encouraged me to browse other clips.

In effect, Truveo combines the browsing experience of a YouTube with the best Web-wide video-search engine I've seen.

The other video-search sites I tested included Google's (www.google.com/video) and Yahoo's (www.video.yahoo.com), as well as Blinkx.com (www.blinkx.com). None of these three sites do much to encourage browsing; by default they display as many as 10 results per search on one page and display the clips in a vertical list, forcing you to scroll down to see them all. The majority of clips watched on Truveo, Yahoo and Blinkx direct you to an external link to play the video on its original content provider's site -- which takes an extra step and often involves watching an advertisement.

Searching on Google video almost always displays only content from Google and its famously acquired site, YouTube. The giant search company is working on improving its search results to show a better variety of content providers. Still, the upside here is that clips play right away in the search window rather than through a link to the site where the video originated. YouTube works this way because its clips are user-generated -- either made by users and posted to the site or copied from original host sites and posted to YouTube, saving a trip to the original content provider's site.

Yahoo's video-searching page looks clean and uncluttered, with a large box for entering terms or phrases with which to conduct searches. Two options -- labeled "From Yahoo! Video" and "From Other Sites" -- help you sort results in one step. But the clips that I found on Yahoo video seemed less relevant, overall, and included more repeated clips. One search for the Discovery Channel's "Man Versus Wild" show returned seven clips, four of which were identical.

Blinkx, a three-year-old site, distinguishes itself with its "wall" feature -- a visually stimulating grid of moving video thumbnails. It is like Truveo in that it also works behind the scenes for bigger companies, including Ask.com. Blinkx says it uses speech recognition and analysis to understand what the video is about, while the others stick to text-based searching. And this seemed to hold true: I rarely got results that were completely off-base using Blinkx.

But Truveo's focus on browsing and searching worked well. It repeatedly displayed spot-on results when I was looking for a video about a specific subject, or provided a variety of other videos that were similar, requiring less overall effort on my part. Its most useful feature is the way it shows results: by sorting clips into neatly organized buckets, or categories, such as Featured Channels, Featured Tags and Featured Categories. These buckets spread out on the page in a gridlike manner, giving your eye more to see in a quick glance.

This grid also lets you change the direction of your search quickly. Tabs at the top of the page can re-sort your results according to Most Viewed Now, Today, This Week, This Month or of All Time. Three more tabs rearrange the results into Highest Rated, Most Recent (my personal favorite) and Most Relevant.

The other video-search sites offered fewer details, overall, about each clip. This meant that I had to waste time opening and watching clips to discern whether they were what I wanted to see.

I searched for a variety of things, including a new television series called "Mad Men" on AMC that has me hooked. The show is still just gaining popularity, so I was curious to see what my video search would return. A single Truveo search can display as many as 51 results on a page, and the bucket organizational system placed all of these results into a layout that didn't look overwhelming. Of the four sites, Truveo had the highest number of clips related to the actual television show: 32 out of 51. On the other sites, all of which show 10 results per page, all of the Blinkx clips, five of the Google clips and eight of the Yahoo clips were relevant.

With the exception of a few clips, Truveo search results include a thumbnail image of each video, its title, channel and category, and a line about how old the clip is and how many times it has been viewed.

The top 15 results -- grouped into three columns of five clips each -- feature slightly larger thumbnail images, and moving a cursor over one of these larger images shows a brief summary of that clip.

If your search generates numerous relevant clips on a well-known Web site, a special bucket is created at the top right of Truveo's results page that will hold just that site's clips. For example, if you were to search an MTV show that's popular enough to have a lot of clips available directly through the MTV.com Web site, a bucket is designated just for MTV.com clips.

Truveo is considering selling this prominent bucket as an advertisement in the future, but for now, no ads appear on the video-search site.

With so many videos added to the Web each day, the search for online clips can be fruitless and tiresome. Truveo starts users out with enough relevant clips right away so that they can more easily find what they're looking for. And its organizational buckets encourage browsing and, therefore, entertainment -- one of the reasons for Web video's popularity.

Truveo takes a refreshing look at video search, and as long as you have the patience to travel to sites where content originated, you'll find it useful. It stands apart from other search engines in looks and functionality.

Link to WSJ Article

YouTube to Start Selling Ads in Videos

By EMILY STEEL
August 22, 2007; Page B3

Nearly 10 months after Google Inc. agreed to buy YouTube for $1.65 billion, the video-sharing Web site is rolling out its first approach for selling ads within videos. The anticipated move, announced last night, answers speculation concerning Google's formula for mining revenue from the site and is expected to start to bring standardization to the growing ad market for Web video.

Resembling a popular ad model cropping up on a number of other video sites, YouTube's new format is a semitransparent ad that appears on the bottom 20% of the video. The ad shows up after a video plays for 15 seconds, and disappears up to 10 seconds later if the viewer doesn't click on it. Viewers can either click to close the ad right away or to watch the commercial. If a viewer chooses to watch the ad, the main video pauses until the commercial stops.

During a video from Ford Models Inc. about how to create an evening hairstyle, an animated ad promoting Time Warner Inc. unit New Line Cinema's film "Hairspray" pops onto the bottom fifth of the video player. When viewers click on the ad, the Ford Models video pauses and a trailer for the film appears. Viewers can click on a link that takes them to the "Hairspray" Web site.

YouTube, a subsidiary of Mountain View, Calif., Internet company Google, plans to sell these ads only on videos from its select content partners, whose original videos include professionally produced clips and user-generated content. The partners will earn a share of the ad revenue. The system is similar to Google's AdSense network, which matches ads to the content of a network of Web sites, and gives those sites a cut of the profits. YouTube, of San Bruno, Calif., has established revenue-sharing deals with more than 50 partners, including Ford Models and Warner Music Group Corp. YouTube declined to say what percentage of videos on its site comes from its content partners.

YouTube started testing its in-video ad format in June and July on more than 200 videos from 20 content providers, and found that 75% of viewers watched the entire ad. The ads had five to 10 times greater click-through rates than standard display ads that appear on Web sites, YouTube said. Other ad models are in the works. In the past month, BMW AG has started testing in-video ads on YouTube. Before the German luxury-car maker commits significant ad dollars, it needs to see how the results compare with other forms of online-video advertising and how users respond, says Rinku Mahbubani, interactive-media supervisor at GSD&M, the ad agency representing BMW.

While YouTube's announcement could pave the way for more ad dollars to go into online video, marketing executives say a number of hurdles remain. Right now, producing advertising for Web video is a logistical headache. If an advertiser wants its ads to run on two different video networks, it usually has to negotiate deals and create different ads for each of the different sites. Marketers also are hesitant to advertise during unpredictable user-generated content, which makes up a large portion of videos on these sites. YouTube says that ads will appear only during "brand friendly" videos, and that marketers have the ability to target their ads to specific genres.

One format advertisers won't see on You Tube is the "pre-roll" ad, the video ads that viewers must watch before viewing a clip. With 55.1 million unique visitors who spent an average of 49 minutes and 59 seconds on the site during July, YouTube is the most popular online video site, according to Nielsen/NetRatings NetView. YouTube has spent months testing different ad formats to figure out which models wouldn't alienate its viewers. It found that viewers abandon videos that include pre-roll ads at a rate of more than 70%, so it ditched pre-roll commercials.

Link to WSJ Article

Online Video: Seeing the Whole Picture

Video images are flooding across the Internet.

No longer an unknown quantity or merely a sidekick to television, the online video medium is fast becoming a formidable viewing factor.

eMarketer projects that the number of online video viewers in the US alone will rise from 114 million in 2006 to 183 million in 2011.

"Some of the major players in the industry are fearful that the widespread availability of video content on the Internet will threaten traditional TV and film distribution models," says Paul Verna, eMarketer Senior Analyst and author of the new report, Online Video: Making Content Pay. "Conversely, others see the potential to increase revenues through a variety of new business models, including ad-supported streaming, pay-to-own downloads, subscription services and online rentals."

Currently, eMarketer estimates that news is the leading type of video content viewed online, with a nearly 14% share of the total. Movie and TV trailers are a close second, at 12%, followed by music videos, at about 11%.

The lowest-ranked categories on this list are either niche genres, such as cartoons and business/financial reports, or content of longer duration, where picture quality is a consideration, such as full-length movies and TV shows.

"Many online video revenue models are emerging, but the growth of an ad-revenue model for online video will be critical to the health of the industry," Mr. Verna says.

By 2011, 165 million US Internet users will have seen online video advertisements, according to eMarketer projections. That number will total 90% of the online video viewership in the US. Comparatively, in 2006, 88 million people — or 77% of US online video viewers — experienced Internet video ads.

"There is currently a debate among advertisers, Web publishers and consumers over the length of online video ads," Mr. Verna says. "But so far no consensus has emerged on an online equivalent to the 30-second standard that has prevailed on TV for decades."

If the relationship between online video content and online video advertising is key to the growth of the Internet video industry, the interconnectedness between TV and the Internet will also play a leading role in how the market for online video evolves.

"Rather than a wholesale shift in viewership from TV to the new media channels, both mediums will actually grow in the next several years," Mr. Verna says. "Internet video will entrench itself in the content mainstream, right alongside TV, although not in such pervasive numbers."

According to eMarketer projections, by 2011 there will be 200 million broadband Internet users. Of them, 91% — or 183 million — will watch online videos.

"Eventually, a number of devices will converge in some form of the long-promised 'digital home,'" Mr. Verna says. "But even in the foreseeable future, consumers will use currently available technologies to enjoy all manner of video content, from Hollywood blockbusters to homespun videos."

Link to eMarketer Article

Yahoo to Revamp Video Site After Losing to YouTube

Aug. 2 (Bloomberg) -- Yahoo! Inc., after losing out to Google Inc.'s YouTube, is revamping its video site by the end of the year to include more content from media companies and Internet users.

Music videos, movie trailers, television shows and sports highlights are among the features that will be available on the new site, Mike Folgner, Yahoo's general manager for video, said in an interview. Yahoo's Flickr photo-sharing site will also be adding video, he said.

``One of our strategies is to put video everywhere you are on the Internet,'' said Folgner, who joined the Sunnyvale, California-based company last year through Yahoo's acquisition of video site Jumpcut. ``We're going to build a much better destination for you to access all this different content.''

Yahoo wants to attract more visitors to its site at a time when more than 130 million Americans are viewing online video, based on ComScore Inc.'s May figures. Of the 8.36 billion streams viewed that month, Google, which acquired YouTube last year, accounted for 22 percent, Reston, Virginia-based ComScore said. Yahoo was third at 4.6 percent, behind News Corp.'s Fox pages, which includes social-networking site MySpace.

Shares of Yahoo, owner of the most-visited U.S. Web site, rose 11 cents to $23.36 at 4 p.m. New York time on the Nasdaq Stock Market and have dropped 8.5 percent this year. Shares of Mountain View, California-based Google slipped $1.93 to $511.01.

Yahoo has deals in place to use music videos from record companies including Universal Music Group, owned by Vivendi SA, and EMI Group Plc, whose artists include Norah Jones and Radiohead, Folgner said. News services including the Associated Press and CNN will provide content along with sports leagues such as the National Football League and Major League Baseball.

``We already have a lot of these deals,'' Folgner said. ``We just don't service them in one place so you don't see them. We'll be able to drive a lot of traffic at this.''

Link to Bloomberg Article

KateModern

Hot on the heels of Michael Eisner’s successful short form episodic web series Prom Queen is a new online video series called KateModern. Created by the producers of LonelyGirl15 and hosted exclusively by social networking site Bebo (the top site in the category in the UK), KateModern is the next evolution of web video.

Similar in ways to ARGs, KateModern is an interactive storytelling platform. Making the webisode genre more experiential, the series is intended to engage the Bebo community beyond just watching a video. KateModern’s characters and plotlines have already been extended outside of the video medium and have been injected into quizzes, polls and comments within the Bebo site. Going forward, site visitors may see “Kate” upload a photo from her mobile phone relating to the story, and will be able to give feedback and clues, thus becoming involved in the story themselves---almost like a real time Choose Your Own Adventure.

With this interactive component, marketers are clamoring to get on board (six brands have signed on thus far). Bebo has two other shows debuting in the next few months, and if KateModern proves to be a hit, you can bet the competition for ad real estate will become fierce.
Link to TrendCentral Article

Dailymotion Gains Ground In U.S.; Enters Deal With RDF

LOOKING MORE LIKE A MEDIA company than a video-sharing site, Dailymotion late last week reached a deal to license programming from reality TV producer RDF USA.

RDF USA is best known for producing prime-time reality shows like "Wife Swap" and most recently "Shaq's Big Challenge." Per the new non-exclusive first-look agreement, RDF will present Dailymotion with eight program concepts for short-form video programming over the next 12 months. The content, which could range from comedic to dramatic, will likely be heavily branded.

It's been a busy month for the Paris-based video-sharing hub, which just made its official U.S. debut with a tailored portal and a team of top media executives to lead the way.

Joy Marcus, former senior vice president of global marketing at Time Warner, is presently leading Dailymotion's U.S. expansion. Also new to the company is a specialized creative and programming team--including Danny Passman, formerly of MTV Networks and a development executive at fuse and VH1, and now Dailymotion's U.S. senior creative director.

Dailymotion.com already does particularly well with U.S. viewers--drawing more than 4.7 million video streams in April, according to comScore Video Metrix. The average video streamer at the site viewed more than 10 videos and nearly one hour of video content during the month. Also, 18- to-34-year-olds represented a significant 37% of Dailymotion's views, according to comScore.

Dailymotion recently worked with Jim Biederman on "The Great Sketch Comedy Showdown," and the Weinstein Co. on a contest for "The Ultimate Star Wars Fanboy (or Girl!)."

Dailymotion is not the first video-sharing startup to tap Hollywood for original content production. Rival Metacafe earlier this year launched a video confessions channel created by Hollywood producer Steven Bochco, which features short videos of twenty-something non-actors sharing highly personal experiences. In addition, Break.com recently entered into a similar first-look deal with NBC Universal Digital Studios.

The company's U.S. launch is being accompanied by standard monetization strategies, including contextual banner and in-stream video advertising.

Revenue-sharing agreements are available to media companies as well as to individual content creators through Dailymotion's MotionMaker program, which is designed to identify and reward popular video contributors.

Link to MediaPost Article

Three of Four US Internet Users Stream Video - 2.5 Hours’ Worth - in May

Nearly 75% of US internet users watched, on average, 158 minutes of online video in May, and Google sites topped the monthly rankings with both the most unique video streamers and the most videos streamed, according to the comScore Video Metrix report for May 2007.

According to comScore’s video-related data for May:

• Americans viewed more than 8.3 billion video streams online, and Google sites accounted for 1.8 billion of those videos streamed (21.5% share of streams); 1.7 billion of Google’s streams were via YouTube.com.
• Fox Interactive Media ranked second with 680 million streams (8.1%), followed by Yahoo sites with 387 million (4.6%) and Viacom Digital with 237 million (2.8%).

• In total, nearly 132 million Americans viewed online streaming video in May.
• Google sites also captured the largest streaming video audience with more than 64.9 million unique streamers, followed by Fox Interactive Media with 52.7 million and Yahoo sites with 35.0 million.

• Online viewers watched an average of 158 minutes of streaming video per streamer.
• The average video stream duration was 2.5 minutes.
• Nearly three out of four (74.3%) US internet users streamed video online.
• More than one out of three (35%) US internet users streamed video on YouTube.com.
• The average online video viewer consumed 63 video streams, or more than two per day.

Link to Marketing Charts Article

Calling All Videos

Alex Gurevich loves to log on to YouTube to watch music videos and comedy sketches on breaks from work. But the 24-year-old entrepreneur from San Francisco fretted that he couldn't take the fun with him on his cellphone. Mr. Gurevich assumed that signing up for a mobile video service would require a "superexpensive" phone and more than $20 extra a month in fees.

So he was surprised to find in January a free new mobile video service -- called MyWaves -- that works with his basic Motorola Razr. Now he is glued to it, regularly attempting to amuse his friends with stand-up comedy clips and other videos he has transferred to his phone. "Why would I sign up for another service if I can get this for free?" he says.

MyWaves Inc. of Sunnyvale, Calif., is one of a flurry of start-ups offering new ways to access Internet videos on cellphones, hoping to overcome barriers that have prevented mobile video from taking off in the past.

For years, cellular carriers including Verizon Wireless and AT&T Inc. have offered licensed video content for cellphones, such as sports highlights, TV shows and music videos. But these services, which carry monthly subscription fees, offer limited content programmed by the carrier and usually work only on certain phones. Adoption has been slow.

Now, the new services are taking a different approach, allowing users to view a wider array of Internet video clips -- without locking themselves into a subscription and without purchasing a fancier phone. The services each operate slightly differently, but users can view online videos using any standard video-enabled phone. Videos can be wirelessly downloaded to a handset for viewing later, or sometimes streamed over cellular networks to be watched in real time.

Powered by Advertising

The quality of the content is rarely as crisp as users are accustomed to online, and viewing can be limited by the amount of storage on a phone. But the services are generally free, powered by advertising and independent of particular carriers. Some new offerings say they have attracted nearly a million users and are attracting tens of thousands more a day.

Recently launched MyWaves offers hundreds of thousands of videos from a wide range of sources. Its online library, organized by "channels," includes clips acquired through arrangements with content providers, culled from available podcasts or provided by users themselves. People can access videos through a free application they download to their phones.

New York-based Cellfish Media LLC recently launched a new mobile entertainment site that allows users to transfer videos and other media, such as ringtones, to their phones from their computers. The service offers some 10,000 clips, including user-generated videos; content from partners, including, soon, NBC Universal; music videos; and original Cellfish series, like a soap opera involving sock puppets. Users upload videos to an online account, known as a locker. Then to retrieve the video, they can log into a mobile Web page. The video service is largely free, but some premium content like music videos carries a fee of up to $2.50.

3Guppies Inc. of Seattle doesn't provide content, but rather enables cellphone users to access online videos that they find themselves online. Users can send a video to their phones directly from the page where it resides, by downloading some software to their computers' Internet browser. Or they can upload videos to an online account, prompting the service to send a text message to a cellphone containing a link to the video.

3Guppies -- which doesn't offer streaming -- transmits videos that are available in a variety of popular digital formats. The service doesn't work with content that media companies protect with proprietary software, such as longer-form TV shows and movies.

The Small Screen

These new services are part of a broad sweep of mobile companies trying to get consumers to translate their fanaticism for online video watching to smaller screens. Popular video sites such as Google Inc.'s YouTube have been branching into mobile by creating condensed mobile Web sites and preloading versions of their services on popular handsets like Apple Inc.'s iPhone. Carriers such as AT&T, Verizon Wireless and Sprint Nextel Corp. have also been wooing customers with services that offer features like live TV.

But still the services haven't caught on. Of the nearly seven million users who watch mobile video or TV from their phones every month, the vast majority watch clips sent to them from family or friends, rather than video prepackaged by a carrier, according to research firm M:Metrics Inc. Overall just 3.6% of U.S. cellphone users subscribed to a mobile video service in the first quarter of 2007, up from 1.6% in the year-earlier period, according to market researcher Telephia Inc.

The new services are trying to open up the mobile video market by targeting a broader range of phones -- at a time when more than 70% of new handsets come with a built-in video player. Instead of charging monthly fees, all three plan to start offering mobile advertising, such as small text ads in the bottom of text-messages or sponsored content from brands.

Consumers are also voicing concerns about storage. Higher-end cellphones increasingly come with up to 64 megabytes of memory and slots that can accommodate more. But many new phones still come with just four or so megabytes, which may accommodate only a few several-minute-long clips.

Limits of Streaming

Streaming video, which is viewed in real time rather than downloaded and stored for later, can be an option -- but only in areas where the network speeds are fast enough. "The experience just isn't really there and there is too much lag time," says Ben Bajarin, a digital media analyst for market-research firm Creative Strategies in Campbell, Calif. But he says that consumption of mobile video content will continue to rise, particularly as media companies create more content designed to entertain users for a few minutes at a time.

Many of the new companies envision themselves as technology -- not content -- companies and are starting to enable users to transfer other media to their phone like music and phones in the same way they can transfer video.

"We don't want to be perceived just as a catalog," says Cellfish Media's CEO Fabrice Sergent, who says the company's goal is to become a mobile version of iTunes. "The idea is really to create a seamless experience from the PC to the phone and from the phone to the PC."

Link to Wall Street Journal Article

Revver Revs Up 'Impressions,' Adds CPM Model To Online Video Ads

by Joe Mandese, Wednesday, Jul 18, 2007 8:15 AM ET

IN A SIGN THAT THE social media and user-generated content market may be developing a traditional advertising model, revenue-sharing online video aggregator Revver this morning announced a plan to begin offering "impression-based advertising products" to advertisers and agencies. The new CPM-based ad deals will include both pre-roll and post-roll ads, which have become the online video industry's equivalent of TV's 30-second spots. Revver said the impression-based pre-roll ads will be no longer than 15-seconds in length, due to the shorter duration of viewing online video, and that to qualify for a pre-roll ad a video must be at least 30-seconds long. Like its original cost-per-click ad pricing model - which pays a user according to the number of ad clicks - Revver said it would split the revenue generated from impression-based ad sales 50/50 with content owners. "As the demand for online video advertising continues to grow, we're building a customizable range of ad products to better meet our partners' needs," said Revver CEO Kevin Wells. The company said the new ads would be tested over the next several weeks. Link to MediaPost Article

Sony Unveils Crackle.com

The Website Formerly Known as Grouper

By Andrew Hampp

Published: July 17, 2007

NEW YORK (AdAge.com) -- If Crackle.com, a new video-sharing site that launched Monday, looks familiar, that's because you might know it under another name. It's the new nom de web for Grouper, the four-year-old site acquired by Sony for $65 million last August, and one that quickly got lost in the shuffle of content hubs with more concrete business models than YouTube.

Crackle wants to build the careers of content creators from day one, with its suite of Sony properties pitching in to help offer aspiring Spielbergs and Shyamalans their chance at a big break.

Jonathan Shambroom, the company's VP-products and marketing, said the old name just wasn't cutting it anymore when it came to reflecting the direction the Grouper executives wanted to take the site.

'Tomorrow's stars today'
"It's still a little bit out-of-date for us," Mr. Shambroom said of the previous moniker. "Crackle represented a dynamic, exciting feel of being a real entertainment platform -- we're representing tomorrow's stars today."

But unlike YouTube's "post-often-and-hope-you-get –discovered" ethos, as practiced by LonelyGirl or the Ask a Ninja guys, Crackle wants to build the careers of content creators from day one, with its suite of Sony properties pitching in to help offer aspiring Spielbergs and Shyamalans their chance at a big break.

Users can currently upload content onto more than 20 different channels, including Wet Paint (for animators), High Wire (for stand-up comedians) and Firehouse, a user-generated channel inspired by FX's "Rescue Me." Various contests are integrated into each one.

Winners of a quarterly contest on Wet Paint, for example, will have the opportunity to get their animated shorts distributed on the big screen through Sony Pictures Entertainment. Makers of live-action shorts will get a similar opportunity through the Shorts Channel, with distribution from Sony's Columbia Pictures at stake.

Sponsored channels
Firehouse is also the first of the Crackle channels to come branded with a sponsor, an approach that Amy Carney, Sony's head of digital sales, hopes to eventually apply to all the site's networks. "We've organized the content so that if a brand has an affinity for music -- and not just broadly music, but indie rock, for example -- if they have an aspirational message to the brand, there's the same aspect for each channel."

Additionally, Ms. Carney and Mr. Shambroom are open to all kinds of ad models, including a new approach to the pre-roll which functions similar to the way ads run on TV. "We will be serving pre-rolls and interstitials at some tolerable interval every couple videos," Mr. Shambroom said. "We know what our own tolerance is for advertising, and that helps us figure out how we integrate ads through the site in a way that's most attractive to advertisers and to users."

Establishing a more unique identity to separate itself from the Revvers and Brightcoves of the world -- both from a content and an ad-model standpoint -- will be the goal for Crackle going forward. Having an all-Flash video player is just the beginning, Mr. Shamboom said.

"We're leading the industry in terms of players and functionality and quality," he said. "But when content creators hear they have the opportunity to reach people in their living room, on the web, it's highly attractive. It goes a lot beyond sharing fractions of cents through pages for a rev-share deal."

Link to AdAge Article

The Boat Is About to Rock (Again) in Internet Video

By BRAD STONE

DMITRY SHAPIRO brings an unlikely gadget into meetings these days: a TV remote control.

As chief executive of Veoh Networks, an Internet video company based in San Diego, Mr. Shapiro uses the remote to navigate the company’s new software program, VeohTV, on his laptop. The software acts like a Web browser but displays only Internet video, presenting full-length television shows and popular clips from the Web’s largest video sites, like NBC.com and YouTube. It lists those videos in a program guide and plays them in a small window or across the entire screen.

The product, now in a private testing phase, will be available to the public later this year. It has the potential to be a popular and practical way to watch online video. But like a long line of other innovative high-tech tools, VeohTV could also threaten and alienate traditional media companies and even cause some of Veoh’s Internet rivals to consider legal remedies.

For the last two years, Veoh Networks has operated a video-hosting Web site, Veoh.com. The site works much the way YouTube does, with a few notable exceptions. The company does not impose any time limits on the length of videos and does not use digital fingerprinting technology to filter out copyrighted material. That has led to some rights holders to complain that Veoh has fallen behind in protecting intellectual property.

Nevertheless, Veoh.com has been growing fast: it draws about 15 million visitors a month, up from 4.5 million in January. Veoh Networks is a private company and does not release financial data. YouTube, by contrast, gets more than 100 million visitors and serves up more than three billion video clips a month, according to several market research firms.

“It’s impossible to compete with YouTube as a video sharing site now,” said Josh Bernoff, a vice president at Forrester Research. “Veoh is a good example of a company that decided to go off in a new direction.”

That direction is VeohTV. To support the new effort, the company raised about $26 million this summer from investors, including Time Warner; Goldman Sachs; Spark Capital, a venture capital firm in Boston; and the former Disney chairman Michael D. Eisner, who joined the Veoh board and counsels Mr. Shapiro, a 38-year-old, Russian-born engineer. The company introduced VeohTV as a beta product last month, making it available for testing to a group of invited users.

I found VeohTV to be easy to use. Once the software is downloaded to a computer, it offers an easy-to-navigate directory of 114 video channels, including listings for CBS, NBC, Fox and YouTube. On the NBC channel, there are dozens of episodes of “Heroes,” “30 Rock” and “Studio 60 on the Sunset Strip.” On the Fox channel, there are several full-length episodes of the dramas “Bones” and “24.”

Those shows are free and available for streaming on the NBC and Fox sites. The VeohTV player, Mr. Shapiro said, is just giving them a new audience.

“There are full-length episodes at Fox.com, but many customers don’t know how to find them,” he said. “The Web browser is fine for short clips. But if you just want to sit back and watch video on the Web, this is what you will want to use.”

Major media companies, however, are more interested in protecting their copyrighted programs. Veoh does not ask for permission to play material from other Web sites, though Mr. Shapiro says he wants to strike advertising-sharing deals with content owners to ensure that shows appear in high-quality video. But Veoh does not think that it needs consent because VeohTV is doing nothing more than playing what is already online, including any commercials shown during the programs.

The networks may disagree. By only offering video, VeohTV omits all the other advertisements on the network sites. For example, people who watched an episode of “Heroes” on NBC.com last week also saw for 40 minutes a banner ad for McDonald’s on the same page. VeohTV users watching the same episode would not see the banner.

Rick Cotton, the executive vice president and general counsel of NBC Universal, said that streaming full-length television episodes drives traffic to other parts of NBC’s site and exposes users to the ads on it. And the right to play those shows is valuable, he said, pointing to the still-unnamed venture between NBC Universal and the News Corporation to create an online repository of their TV shows and movies. Sites like MySpace, AOL and MSN have already entered into commercial agreements to display the venture’s content.

“This material has value,” Mr. Cotton said. “The notion of taking it and generating traffic with it needs to be negotiated and needs to be done with the agreement of content owners.” That’s why NBC and the other major studios are keeping close tabs on VeohTV’s business model.

FOR some video content, VeohTV can act as a digital video recorder, turning a video stream — meant to be viewed on the Web — into a downloaded file on a user’s hard drive. VeohTV users can record a YouTube video, for example, even though YouTube, owned by Google, says its terms of service specify that videos uploaded to the site will only be streamed.

Other software, like the recently released RealPlayer 11, by RealNetworks, can turn streaming video into downloads as well. But according to Ricardo Reyes, a YouTube spokesman, VeohTV steers users away from its ads while violating YouTube’s contract with its users. Mr. Reyes says the company is watching Veoh carefully. In response, Mr. Shapiro says his software provides an easier way to do something that is already technically possible on YouTube.

Mr. Shapiro and his backers are aware their product will disrupt current business models. So have many technological innovations in the past, he argued, and Veoh hopes to build a large audience while courting large media companies. That creates an apparent contradiction that will be hard to resolve. Veoh maintains that it does not need permission to list and play other companies’ videos inside VeohTV. But it also wants to play nice.

“We are going to try to be friendly to content owners,” said Todd Dagres, a partner at Spark Capital who serves on the Veoh board. “We are going to try to be the white-hat company.”

Link to The New York Times Article

UGC Users Outnumber Creators

Are enough people recording their cats?

Even taking into account the power and ease of use of user-generated content tools like digital cameras and affordable audio/video production software, there are more content consumers than creators.

In the US, the number of users of user-generated content will hit 101 million by 2011, up from the 2006 estimate of 69 million.

Globally, the estimated number of user-generated content users will hit 254 million by 2011, up from 128 million in 2006.

Not surprisingly, the number of people who create content — i.e., post videos, photos, music, blogs, wikis, personal profiles and personal Web sites — is expected to increase significantly as the user-generated content movement gathers steam, rising to 95 million in the US by 2011, up from 70 million in 2007.

Globally, the number of user-generated content creators will reach 238 million in 2011, up from 137 million in 2007.

John Horrigan of the Pew Internet & American Life Project said in a Clickz interview, "[The Web is] shifting now to user-generated content; it shows people engaging with the Internet in a number of different ways in their lives. It shows that people are pretty interested in using the technology to put something of themselves on the Internet, not just pull down information from the Internet."

Link to MediaPost Article

Wal-Mart Moving Into YouTube's Neighborhood

Thursday, Jul 12, 2007 5:00 AM ET

THE BENTONVILLE, ARK.-BASED COMPANY IS launching a consumer-generated content web site via Draper, Utah-based web content company Sequoia Media Group, that lets consumers turn their photos into movies. Wal-Mart Mini Movie is to be a free Web site where people can create and share videos. The site will be part of Sequoia's aVinci Experience site that lets consumers apply special effects and storyboards to their home videos and photos. Wal-Mart Mini Movie will be at walmart.avincimovie.com. Registered users can choose from templates like Vacation, Wedding, Sports, Family, Celebrations and All Occasion, then upload up to six photos, add a title, then make movies. A coordinating Movie Poster is also automatically generated and ready to share. The program can also be accessed at Wal-Mart Photo Centers and is included on Wal-Mart Photo Center promotional disks and on Fujifilm digital album photo disks. Wal-Mart and Sequoia Media Group also plan to release next week a full-length DVD movie product called myMovieMaker scheduled to launch in all 3,500+ Wal-Mart Stores. The MyMovieMaker lets consumers make DVD movies using in-store Fuji kiosks, at a cost starting a $12.86. Link to MediaPost Article

Taco Bell Gives Customers Starring Roles

Taco Bell is giving people a chance at 30-seconds of fame as part of an online search that uses consumer-generated content with a twist.

The company has teamed up with Gizmoz and MTV to search for three consumers to star as animated characters in an upcoming TV spot.

Customers upload digital photos to TacoBell.com through July 22 to audition for the spot. On the site, visitors customize their photos to bring them to life using the online technology or can choose from the gallery of Gizmoz animated characters. They then record their voice for a 15-second, lip-synched audition explaining why they should be a Taco Bell star.

Users can also send their creation to a friend or post it on a blog, video site or social networking profile or rate other consumer auditions.

“We’re looking for people with creativity, something that will make people stand out,” said Taco Bell spokesman Rob Poetsch.

On Monday, the day the contest began, 10 entries had been submitted.

Taco Bell will judge the auditions based on personality, originality, appeal and expression. The panel will choose three winners, whose likenesses will appear in a commercial for Fourthmeal, the late night meal between dinner and breakfast during the “MTV Video Music Awards” on Sept. 9.

Beyond the TV spot appearance, winners will receive a salary for a day ($3,725 for the lead role and $179.55 for a non-speaking role) and a year’s worth of Taco Bell food.

The TV Me promotion marks the first time Taco Bell is using consumer-generated media as part of its advertising mix. A co-branded spot will air this week on MTV to promote the auditions.

Banner ads and online marketing also support the promotion. Draftfcb will produce the TV spot for Taco Bell.

Link to the Promo Article