Springtimefor Streaming

By Tara Seals

Posted: 05/2002

Springtime
for Streaming
Collaboration, Conferencing Bloom as Web-Based Business Tools

By Tara Seals

EVEN AS THE FIRST flowering promise of the Internet turned black and fell off the bough last year, a new crop of web-enabled business tools were budding. Web-based collaboration and conferencing is an area that many hope will bear fruit, and a particularly dynamic bloom is streaming media.

Streaming technology allows users to view multimedia across the Internet as it arrives to the desktop. There’s no waiting for downloaded files, and that makes streaming easy for users of lower-bandwidth Internet service. It also makes it a great choice for businesses looking to decrease operational expenses. Whether using streaming to communicate internally or externally, it is much cheaper than web conferencing, and it offers benefits like on-demand playback of speeches, marketing messages, interviews and other corporate information over the web, with a mass market reach to millions.

It’s not right for every application, and there are hurdles in using the technology for business, particularly the lack of QoS and security afforded on the public Internet. Nonetheless, streaming is coming into it’s own. Usage and surrounding revenue opportunities for service providers and partners serving commercial accounts are blooming an tremeondous rate.

According to a new report from Streaming Media Inc., 45 percent more companies are streaming this year than last, and there has been an 86 percent increase in enterprise spending on the services. The firm also reports a 35 percent increase in the number of people served, and — here’s the kicker — a 230 percent increase in the number of stream hours delivered. Put simply, more companies are using streaming more often to reach more people.

A Bouquet of Applications

Once synonymous with Internet radio, Star Wars trailers and MTV concert tie-ins, webcasting — streaming audio and/or video over the ‘Net — is becoming a viable business technology. An obvious application is broadcast of quarterly earnings calls for public companies. Under the government’s fair disclosure laws, publicly held companies are required to release quarterly financial information to the widest audience possible — and that means they have to use
webcasting.

Another forced use of the technology is for government agencies, required by law to include closed captioning in all web video content. Again, streaming media is the only technology that allows closed captioning beneath the video.

But with the arrival of broadband access to most business environments, the uses of streaming are becoming more varied. “What we’re seeing now is that corporations are finally beginning to grasp the fact that there is no other technology besides the Internet itself that allows people to communicate without geographic boundaries,” says Dan Rayburn, an independent streaming media consultant and author. “Traditional companies that used to spend money on print, radio and TV are realizing that traditional broadcasting can only do so much.”

Thus, streaming can be rendered into a powerful marketing tool. Apple Computer Inc.’s Steve Jobs delivers speeches that are broadcast to thousands. Internet attendance for Jobs’ January Macworld San Francisco keynote webcast was a record-breaking 81,000 simultaneous viewers, doubling a previous record from June 2001 at Macworld New York.

Similarly, many consumer-focused corporations use streaming to deliver a richer product experience to website visitors. The Acura car company lets anyone with Apple’s QuickTime streaming client (available free to consumers with most browsers and operating systems) to deliver a virtual test drive inside the new Acura NSX 2002, with a combination of streamed video, audio and QuickTime’s “VR” virtual reality technology.

Distance learning and corporate training is another growth area. Lawline.com for example uses a mix of audio/video webcasting and downloadable text to make it possible for lawyers in 16 states and Washington D.C. to meet continuing legal education requirements imposed by the state, on their own schedule, without leaving their living rooms.

Corporate training becomes crucial for business survival in verticals such as financial services, and webcasting makes it easier to accomplish.

“Financial companies have daily things that they teach people how to sell,” says Tony Greenberg, CEO of Ramp^Rate LLC, a technology advisor and communications channel partner. “And what they usually do is video conference or record the night before and send out video tapes for people to watch, which is absolutely ludicrous and totally inefficient.

“So that stuff all goes online and is a big driver for business and enterprise sales,” he explains.

Finally, internal corporate communications is another segment. “We’re finding internally that this is being used a lot,” says Rayburn. “The CEO of Ford [Motor Company] was doing a live webcast every week during the Firestone crisis, out to the dealers, just to update them on the whole tire issue.

“The only way he could reach all those dealers and keep it private was through webcasting, unless he did a traditional conference bridge, which is more expensive,” he adds.

Blooming Revenue Opportunities

Streaming is a technology, not a service, but it can be parlayed into dollars for savvy channel partners and resellers that delve into the products and services wrapped around it.

For instance, net.com offers a platform via its VAR and integrator partners called SCREAM, which stands for Service CREAtion Manager. SCREAM allows carriers and service providers to create applications that are drivers for next-generation networks, including video-on demand and webcasting. But with SCREAM, carriers can deliver them on existing networks with bandwidth guarantees, without significant revamping of infrastructure.

“The economic meltdown means a lot of carriers are retrenching, and the need to differentiate and demonstrate profitability in the network is important now,” says Julian Thomas, director of product marketing for net.com. “Reducing operational expenditures is key to any business plan moving forward in the carrier space, and carriers seek to add these new services to enhance their bottom line.”

SCREAM could allow subscribers with basic connections to select an enhanced streamed service, and once they choose to watch say a video, their connection would be automatically upgraded for the duration, then go back down after the stream is over. The subscriber would be billed incrementally for the higher bandwidth. Or, a carrier could market a webcasting service to small and medium-sized businesses, with guaranteed QoS to a local cache of streaming video or audio.

On the service side, partners can sell offerings such as AT&T Corp.’s Digital Media Centers’ streaming media service, specifically designed for live and on-demand programs such as corporate training. Offerings include digital production technology, such as virtual set production and motion-capture animation. Partners also can offer related services like digital capture and processing of existing training programs; application packaging; archiving and storage services; and professional support services.

Putting the mechanisms in place that stream-enabled websites need to deliver their content is also an area ripe for the plucking. Ramp^Rate is a commissioned channel partner for colocation and bandwidth services, streaming and managed services. It partners with about 100 suppliers ranging from Qwest Communications International Inc. to Raindance Communications Inc. to LoudCloud Inc. Ramp^Rate performs streaming media and content delivery network design, procurement, implementation and management.

“We partner on our side with VARs, integrators, consultants and VCs,” says Greenberg. “In terms of client acquisition, our partners that are building a website or adding in equipment, they may see that there’s a need to handle streaming media, so they come to us. And we pay them a percentage of what we revenue on each of the channel fees that we get paid.”

ScreamingMedia Inc., a content aggregator and platform developer, has an Alliance Program for partners such as VARs, systems integrators, consultants and web developers. Its services include content services, for adding rich media to websites and portals, management of multiple content feeds, syndication of original content to licensees, integration into existing business systems and content delivery to wireless and interactive TV applications. It also offers turnkey portal applications.

NCast Corp. uses interactive multicast technology (which allows two-way communication in streaming) to provide collaboration tools for large groups and remote locations. It offers sales channel programs for systems integrators, ASPs, consultants and other IP-savvy partners.

Conferencing companies such as Premiere Conferencing and Raindance have a streaming audio offering or component that allows the transfer of the conference to the web on a live or on-demand basis. Both companies have agent and reseller channel programs. VideoNEXT Inc. sells the NEXTcam, a self-contained IP appliance that can build business quality videoconferences, and then stream them through a website. Events can be seen live or from an archive. The company offers a reseller and agent program; master agency Association Resource Group is one of its largest channel partners.

Webconferencing Chart
Source: Wainhouse Research

Weeds

For all its hipness, streaming media does have its detractors, and its problems. “9/11 has dramatically affected people’s interest in streaming and casting and conferencing,” says net.com’s Thomas. “It hasn’t taken off because there hasn’t been a compelling example of how it’s different and provided with
QoS."

SCREAM may fix quality issues, but widespread deployment of the platform has yet to happen. So, Internet and network pitfalls still exist in many areas, leading to a potential for dropping packets and the choppiness that typifies the public Internet.

“The problems we’ve seen with streaming as a category is that the Internet, from an architecture standpoint, is not necessarily reliable enough to offer the level of quality that we want to make sure our clients receive,” explains Sean Spradling, a product manager at Premiere. “VoIP technologies for example are interesting and an up-and-coming thing, but you really haven’t achieved the level of quality you need.

“If I have 2,500 investors I can’t afford poor quality,” he adds.

Michael
Jaret, a senior product marketing manager for web conferencing leader PlaceWare Inc., also cites as a barrier the technological investment on the part of the user. “The challenge as we know with video conferencing and streaming is that you really do need good bandwidth, good computers and media players,” he says. “The nice thing with web conferencing is that you don’t need all that, you can use a 28.8 modem and get the same thing.”

PlaceWare supports streaming audio and video clips within presentations, but Jaret says the demand is decreasing for such bells and whistles. “It just doesn’t add much to the conference,” he says.

From virtual classrooms to sales demonstrations to marketing seminars, Jaret says the areas webcasting targets for business use are better served by web conferencing, where perks like collaborative white boarding and 99.985 reliability stand it in good stead. “We’re finding e-learning folks are dropping webcasts, because they want better abilities — for instance, the window is too small in webcasts to show slides, it’s hard to get a visual,” he notes.

PlaceWare, Raindance and Premiere meetings all can be placed online for later playback, as well.

These may be compelling arguments, and clients may be willing to pay the extra per-minute charges, which far outweigh the cost of streaming. According to a recent study by Wainhouse Research, an independent research firm in Brookline, Mass., the overall conferencing services market, including audio, video, web and streaming conference services, will grow by 22 percent during the next five years to $9.8 billion in 2006. Web conferencing is predicted to have the highest five-year compound annual growth rate of the four subtypes, at 42 percent.