Video Technology Magazine

Streaming Internet Content: The Failing All or Nothing Strategy

Author: Jesse Monroy, Jr.

Date: March 6, 2001


Currently technology companies are bent on an All or Nothing Strategy. This failing strategy is frustrating producers and viewers alike. In both cases, not only are sales and marketing peddling this destructive process, but architecture and engineering are also working in concert.


One such example is Xing Technologies. They exhibited this arrogance in 1995 when they force producers and viewers alike, to switch from their v1.x to v2.x technology. This move cost them the market. At the time, Xing had the dominant product on the market with all the hooks necessary to take a command position. Instead of following with their previous plan, they decided that v1.x software would not be compatible with v2.x. In short, this meant that viewers with the v1.x software could not view the new cybercasts by the 2.x servers. This meant the viewers needed to upgrade their software. As a result, the viewer stops whatever they were doing , then downloads, installs and sets up new software. Since this action was called for, the viewer had equal incentive to download the competitors software and try it.


In the end, no company had a superior downloadable package for viewing cybercasts over the Internet. However, other companies offered ancillary services, such as viewing guides - where viewers could find content, and thereby beat the chicken and egg syndrome. And since, Xing had a weak content guide by comparison, viewers move to where the content was; even if it was of poorer quality.


In much the same way, the Internet technology sector is making weak offerings. Traditional entertainment companies, which have lived peacefully for years with incremental technology shifts, see the Internet and the sector as threats. Companies, such as Microsoft have underscored this threat, which have setup production studios and continuing to run content venues in spite of heavy losses. It is no wonder then that the entertainment (or content) companies are slow to move.


The technology sectors, then, have continued to offer All-or-Nothing technologies. This is best seen by Content Distribution Providers, such as Akamai, iBeam and Digital Island. These technology companies offer a distributed network of computers that replicate (or duplicate) content. As such, this technology threatens the single largest profit center for film industry, distribution.


Another technology with an All-or-Nothing bend is MPEG. The technology has profited in niche' markets - namely video transport. In this market, it works well because from end-to-end the content is under the control of the of those destine to profit from it, in this case Cable TV. With this system, the videotape is taken directly to digital, then sent to a satellite, then transfered back to tape, or stored in digital format, until ready broadcast with traditional methods. Even in the most advance systems, MPEG is merely used as a means to reduce overhead; so more channels can be added. To date there are are few profitable working systems, that offer VOD (Video On Demand). And those system that do are limited to small and limited markets with small geographic dispersion, like hotels or conference centers.


Even so, many vendors have arrived with new MPEG systems. However, even in those systems that work with computers, and not specialized equipment, they rely on traditional data transport methods - or very expensive elaborate systems that sit close to the final delivery point. In few of these cases the systems are incapable of handling thousands of users - even with latest equipment. And even in those case, ancillary services, such as increment pay-per-view, flat-rate systems or use-monitoring, are non-existant. The end result is that these system require extensive system expertise, or a system that locks producers and/or viewers into a single system.


Companies the have already lost their shirts with MPEG over IP include, Huerris-Pulizter, Xing, Sony, Microsoft and Phillips.


MPEG as a video system, in itself, has problems. The problems include:


                     The need for special video encoding hardware.

                     The need for special video decoding software.

                     The need for special transport (delivery) systems.

                     The lack of decent audio codecs designed for Internet.

                     And lastly, it typically requires lots of bandwidth.


Specifically, MPEG is just a defined standard - with many possible implementations and many methods by which to tackle a common problem. That said, even if MPEG issues could be oviated, the larger problem is the transport system. In telephony or cable television technology, the problem is known as the "last mile" problem.


The telephone company solves this problem by creating COs (Central Offices), where all signals are transported to a central location and then broken out in wire strands to each and every business or home. In short, every single business or home has two (2) copper wires that connect it to the CO. In turn, each CO is connected to one or more COs. From a certain perspective, the system looks like stars layered on top of stars. The system is complex, in some nature, but is organized and has redundancy to re-route signals.


The cable-tv company has a slightly easier problem. Rather than transporting an unknown number of random signals, which could be thousand - or hundreds of thousands, from one point to another, it transports a fixed number of signals to a fixed number of locations. On this system there are no unknowns; traffic moves (mostly) in one directions and it is not expected to move in the opposite direction.


Satelite systems work much the same way as cable-tv, with the exception that they do not use copper wires in the final mile, they use a radio link.


While all these problems have reasonable solutions, it is clear that the technology people are clueless as to how to solve this. This part of the problems stems from "Startup" and/or "Corporate" thinking.



To conclude, Streaming Internet Content is years away. Aside from technical issues that would require a few million in research and development, the current business structures - via public corporations - is inpractible for a system that requires easily replicatable and easily operatible systems.