October 1, 2007
Volume 19, Issue 5
BitTorrent Opens Subsidiary in Japan
Excerpted from VNUNet Report by Clement James
BitTorrent has established a wholly owned subsidiary headquartered in Tokyo.
The company said that BitTorrent Japan will address a growing demand for peer-assisted content delivery technology among Japanese content publishers and consumer electronics manufacturers.
Japan has some of the world’s most advanced broadband and mobile networks, electronics devices, and game consoles, as well as web services.
BitTorrent believes that there is high demand among content publishers and electronic software providers for BitTorrent Delivery Network Accelerator (DNA), a secure, managed peer-assisted networking platform that reduces bandwidth and content delivery costs.
BitTorrent DNA enables websites to provide a better end-user experience by adding speed, reliability, and efficiency to their current content delivery infrastructure.
The company said that there is also high demand among Japanese hardware manufacturers to integrate BitTorrent’s software development kit (SDK) into next-generation consumer electronics devices.
BitTorrent is already working with Japanese device manufacturers such as Buffalo Technology and Planex Communications to integrate its technology into the latest network-attached storage devices, wireless routers and set-top boxes.
“We are intrigued by Japan’s advanced broadband environment that exists as a result of innovation and competition among ISPs,” said Ashwin Navin, President & Co-Founder of BitTorrent.
“BitTorrent has the ability to leverage the capacity that exists within the Japanese internet to create great user experiences for online applications while dramatically reducing infrastructure costs for publishers.”
The company believes that BitTorrent’s security, performance, efficiency. and technical merits will become the leading peer-assisted delivery platform in Japan for on-demand video, software, and video games.
“Having a physical presence in Japan promises an unparalleled level of support to our Japanese partners and commitment to customer success,” added Navin.
Joost Scores Major League Baseball
Leading peer-to-peer television (P2PTV) service Joost has entered into an exclusive partnership with Major League Baseball Advanced Media (MLBAM), the league’s interactive media and Internet company. The agreement grants Joost the rights to make on-demand game broadcasts and highlight clips from the 2007 MLB postseason, including the World Series and Daily Rewind, a daily highlight program, available on its streaming video distribution platform to a global viewing audience.
“The baseball post-season, concluding with the World Series, truly embodies the greatest aspects of the game and engages an international audience,” said Kenny Gersh, Senior Vice President, Business Development, MLBAM. “Our partnership with Joost allows us to continue to reach baseball’s increasingly growing global fan base by providing them with free on-demand broadcasts of every game from the most dramatic and emotionally charged month on the baseball calendar.”
The Daily Rewind program, a 30-minute program that features highlights from all the championship action on and off the field, will be streamed on Joost on a daily basis. In addition, Joost will begin streaming games on-demand from the Division Series, League Championship Series, and World Series around the world. All games and shows will be available on Joost for one month.
Yvette Alberdingk Thijm, Executive Vice President of Content Strategy & Acquisition for Joost, said, “Baseball brings friends and families together, and we have a unique opportunity to connect fans around the world on Joost while they watch these games and highlights on their time, on demand, online. This is a great partnership between Joost and MLBAM that will delight our users.”
Founded by Janus Friis and Niklas Zennström, Joost combines the best of TV and the best of the Internet by offering viewers a full-screen audiovisual experience enhanced with the choice, control, and flexibility of Web 2.0. Joost is the first online, global P2PTV distribution platform, bringing together advertisers, content owners, and viewers in an interactive, community-driven environment.
Report from CEO Marty Lafferty
 We proudly announce our first wave of speakers and sponsors for the upcoming P2P ADVERTISING UPFRONT LA. This first-of-its-kind DCIA marketing conference is scheduled for Monday October 29th at the Renaissance Hollywood Hotel in Los Angeles, CA, and is being held in conjunction with Digital Hollywood Fall.
Our confirmed speakers now include BitTorrent’s Eric Patterson, Brilliant Technologies’ Allan Klepfisz, BUYDRM’s Christopher Levy, Catalyst’s Cory Treffiletti, DeviantART’s Steve Gonzalez, FTI Consulting’s Bruce Benson, Fun Little Movies’ David Lee, IFPI’s Jay Berman, Javien Digital Payment Solutions’ Leslie Poole, LimeWire’s George Searle, LTDnetwork’s Rick Riccobono, MediaPass Network’s Daniel Harris, OKCupid’s Sam Yagan, PeerApp’s Mark Strangio, QTRAX’s Christopher Roe, Rebel Digital’s Lance Ford & Robin Kent, SafeNet’s John Desmond, StreamCast Networks’ Mike Weiss, Ultramercial’s Dana Jones, Universal McCann’s Elias Plishner, VeriSign’s Stuart Cleary, and YuMe Networks’ Jayant Kadambi.
The P2P ADVERTISING UPFRONT LA Market Conference will highlight QTRAX, Catalyst, the LimeWire Music Store, and YuMe Networks among other breakthrough advertising-based P2P efforts.
QTRAX is the world’s first fully licensed, free, ad-supported, P2P music service. Showcasing an innovative downloading business model that easily directs revenue back to artists and rights holders, QTRAX is the first P2P to be embraced en masse by the music industry. QTRAX has signed licensing deals with the major labels, music publishers, and leading indies, including EMI Music, Warner Music Group, Sony/ATV Publishing, Universal Publishing, TVT, The Orchard, and V2. Hosted on the Gnutella network, the soon-to-commercially launch QTRAX will provide fans with access to a colorful and diverse catalog with tens of millions of high-quality, high-fidelity digital music files. Based in New York City, QTRAX is a subsidiary of Brilliant Technologies Corporation, a publicly traded global technology holding company.
Catalyst is a newly-launched marketing capital firm that helps companies of all sizes to develop and implement emerging digital media strategies resulting in the most effective, efficient, and direct means of conveying marketing messages to target audiences. The company already boasts leading P2P firm Azureus among its charter clients. Catalyst was co-founded by Cory Treffiletti, a well known and highly regarded online advertising industry player who previously served in senior executive roles at Carat Fusion, Freestyle Interactive, and IUMA.
LimeWire’s open P2P application currently reaches a monthly cumulative audience of 60 million unique visitors – in turn generating 5 billion searches per month. The monetization of this traffic through innovative advertising-supported and paid download strategies will be the mission of the new LimeWire Music Store. Initially the store will be a stand-alone website accessible from links in the file-sharing software. Subsequent releases will enable users to browse and purchase music in the universally compatible MP3 format directly from within LimeWire. P2P ADVERTISING UPFRONT LA attendees will get a first glimpse of this exciting new offering, which will feature many firsts for P2P advertising that will be executed in close collaboration with participating content owners and rights holders.
YuMe is the first dedicated broadband video advertising network built exclusively for the web video world, including the spate of new peer-to-peer television (P2PTV) offerings. YuMe provides advertisers and publishers with the unprecedented ability to identify, classify, and track content to ensure brand safety, contextual relevance, controlled syndication, and consistent delivery across all digital media platforms – web, downloads, mobile, and P2PTV. YuMe is already delivering new online video ad solutions for web publishing partners and advertisers across the Internet, including top P2P firms BitTorrent, Pando, and Vuze. Today, the company serves advertising in more than 100 million video segments every month and offers a suite of ad formats that go beyond traditional pre, mid, and post-roll ad placements.
The P2P ADVERTISING UPFRONT LA is being held in conjunction with Digital Hollywood Fall (DHF), and registration for both events yields a substantial savings for attendees. For more information, feel free to visit www.dcia.info/activities/p2p_advertising_upfront. Pre-registration rates, which save attendees up to $339, end October 19th. To register please visit www.dcia.info/activities/p2p_advertising_upfront/register.html.
P2P ADVERTISING UPFRONT LA sponsors include FTI Consulting and Javien Digital Payment Solutions. For sponsor packages and speaker information, please contact Karen Kaplowitz, DCIA Member Services, at 888-890-4240 or karen@dcia.info. Share wisely, and take care.
YuMe Powers Advertising for Vista TV
YuMe, the first dedicated advertising network created and optimized for broadband video, is working with Microsoft to enable the software leader to offer advanced broadband video advertising capabilities in the Internet TV category.
Microsoft selected YuMe as its ad-serving platform and ad sales partner for the beta trial of its new Windows Media Center Internet TV, which is now available to all Windows Vista Home Premium Edition and Windows Vista Ultimate Edition users in the US. Media Center users now have access to the new beta Internet TV feature where they can enjoy full-screen ad-supported on-demand video content on their PCs.
Media Center Internet TV beta will also be available directly on television screens around the home through new Media Center Extender devices which Microsoft launched this week. Users of Microsoft Xbox 360 will also be able to access the same Media Center Internet TV beta experience on their TVs.
“It’s a tremendous honor for our young company to be chosen to deliver the advertising that will power this groundbreaking new feature from one of the world’s most innovative companies,” said Jayant Kadambi, CEO of YuMe. “We’re looking forward to working with advertisers and agencies to help them to reach a new audience on a platform that can deliver consumers through their television sets in the digital home.”
The Windows Media Center Internet TV beta from Microsoft offers more than 100 hours of video content, including full-length episodes of television shows, music concerts from leading artists, movie trailers, and news and sports clips. Microsoft plans to introduce exciting new interactive ad formats for advertisers during the beta trial.
“We believe that advertising is a key aspect to bringing the greatest breadth and depth of content to the digital home,” said Dan Poling, Director of Advertising for Windows Media Center. “We’re pleased to be working with YuMe to introduce this ad-supported video content to Windows Media Center users. YuMe offers a platform that can meet our ad serving, targeting, and inventory management requirements for the new Internet TV beta.”
Ad-Supported Music Put to the Test
Excerpted from Globe and Mail Report by Mathew Ingram
Delivering entertainment for free – paid for by occasional ads for cars and toothpaste – has worked pretty well for TV and radio all these years. So why not use the same model for music that gets delivered over the Internet?
That’s the idea behind SpiralFrog, a new service that launched earlier this month. It’s one of a number of services that are trying to make a business out of giving away ad-supported music.
With SpiralFrog, users must watch a video advertisement while a song is downloading. Two-thirds of the income from those ads is then passed on to record companies and others who hold the licensing rights to the music.
SprialFrog founder Joe Mohen, a former software industry executive, says that while the idea seems simple enough, the reality of putting together such a service has been “the most complex project I’ve ever undertaken.”
The company has been around for almost five years, but only opened to the public a couple of weeks ago, in part because the technical issues involved were so complex. The service was originally scheduled to launch last year.
SpiralFrog has also undergone a certain amount of executive turmoil. Several senior executives left the company in January, including CEO Robin Kent, the former Chairman & CEO of ad agency Universal McCann.
Robin Kent is now involved with another music start-up that plans to give music away supported by ads, QTRAX, which is based on P2P technology similar to that used by LimeWire and other music-sharing services.
QTRAX has already signed licensing deals with EMI, Universal Music, Sony BMG, and Warner Music. Another ad-supported service called We7, which is based in Britain and was co-founded by singer Peter Gabriel, also launched recently but doesn’t have any deals with major music labels.
Mohen says the most difficult part of getting SpiralFrog running has been tracking down the different parties who might own the rights to a piece of music. That’s part of the reason why the company did its early trials in Canada, he says.
Canada has several agencies, including the Canadian Music Reproductions Rights Agency (CMRRA), that can “get you the rights to 85 per cent of the songs with a single contract,” says Mohen, and therefore it is “a much easier place to get started.”
In the United States, there are 38,000 separate music publishers and rights-holders, the SpiralFrog CEO says – and no single agency keeps track of who owns what.
Not surprisingly, Mohen says that convincing the four major record labels to try and use the SpiralFrog service has also been extremely time-consuming.
“It’s like going to General Motors and convincing them to give away the cars for free, in return for half the gas money,” he says. “This was not an easy undertaking.”
While the industry is desperate to find alternative sources of income as CD sales continue to fall – EMI recently started selling its songs without any digital rights management (DRM) controls, the first label to do so – not everyone is convinced that giving away music will work.
At the moment, Universal is the only major label to offer its music catalog through the service. The SpiralFrog CEO says negotiations are ongoing with the other major labels, however, and that the service now has over 800,000 tracks.
Mohen says that SpiralFrog currently has several large advertisers signed up for the service, including Chevrolet, Colgate, Sony, and Burger King.
Balance of TV Power Will Shift
Excerpted from Rapid TV News Report by Chris Forrester
Silvio Scaglia, who co-founded Fastweb and is the Founder, Chairman and financial backer of P2PTV service Babelgum, says the balance of power will shift away from broadcasters towards individual rights holders, and consumers.
Scaglia was speaking at the Rapid TV News-organized Broadcasting “2017” conference in London. He said questions about the ability of the Internet’s scale to cope with demand, and whether operators should stream or download content were largely irrelevant.
“Asking, ‘will users want premium or niche content?’ or ‘how do we cope with existing rights restrictions?’ are largely irrelevant when placed alongside the question of how the broadcasting industry deals with this fundamental shift in power.”
He said he felt strongly that “the new environment places the power directly in the hands of individual rights owners and consumers. It is an almost perfect democracy that provides potentially limitless choice.”
“The big box in the corner of the living room is no longer the only device capable of receiving video – a whole range of fixed and mobile devices are now just as capable, if not more so. Streaming and encryption technologies have developed to the point that content owners can distribute in secure environments in which their intellectual rights are protected.”
He said that broadcasters themselves were making these distribution methods so much easier. “The industry is quickly moving from tape-based to digital formats that allow for efficient editing, archiving, and distribution. Additionally, a dramatic reduction in the cost of television-quality video production means that even talented individuals have the means to producing viable content.”
Veoh's Dmitry Shapiro Plans to Win
Excerpted from Wired News Report by Miyoko Ohtake
The next big moneymaker on the Internet, they say, is video. Of course, YouTube rules the market for now, but several upstart start-ups are trying to leapfrog that site’s buffered clips (or rather: buffering... buffering... buffering... clips).
The hot concept among would-be YouTube killers is a sort of video-only browser, one that trawls the web for content and transmits it from PC to TV.
San Diego-based P2PTV service Veoh is the frontrunner, with former Disney CEO Michael Eisner on the board and nearly $40 million in venture capital funding. We asked Veoh’s founder, Dmitry Shapiro, how he plans to win the video wars.
Wired: Some reviewers have called VeohTV “TiVo for the Internet.” What’s that mean?
Shapiro: Back in 2004, searching out video on the Internet was already being pioneered by BitTorrent. Now consumers can find content on YouTube or Veoh or MySpace or CBS. VeohTV gets videos wherever they live.
Wired: But while Veoh will record downloadable files, it only grabs the links to streamed video, which is what the TV networks use online. So it’s not really TiVo, right?
Shapiro: No, probably not.
Wired: How is VeohTV different from P2PTV leaders Joost, Babelgum, or any other television browser?
Shapiro: VeohTV gives users access to practically all video on the Internet, from YouTube, Yahoo, wherever. Joost or Babelgum are closed-wall gardens, showing video that the company has cut deals to air. Plus, VeohTV feels like television. It’s a much more intuitive and relaxed experience.
Wired: How so?
Shapiro: Your laptop works almost like a cable set-top box. It’s a very different feeling when you’re watching TV from the couch rather than leaning over a computer and clicking.
Wired: And how do you make money doing this? Ads?
Shapiro: If you have a big enough audience that’s consuming content, you’ll be able to sell advertising. Just look at where search was in 1997. It was a loss leader for portals. Then Google started selling little text ads and the business model was created. Now video is in the exact same spot 10 years later. But it’ll change.
Selfcasters Rock Onwards and Upwards
What’s on RawFlow's Selfcast? The Red Bull Bedroom Jam has started, so get to the nearest computer and be a part of history in the making. The Bedroom Jam crew will arrive, collect the musicians and selected friends, and the fun begins. Red Bull in collaboration with Xtaster, Selfcast, and Maudio presents the event of the year! Watch it live at Red Bull Bedroom Jam on Selfcast.
Also rocking are our lovely lads the Drookit Dogs who are broadcasting Rockpad on Selfcast 24/7 from their Brighton based RockPad. The other night they had celeb pals The Maccabees in the house... so stay tuned for more action!
PS: Like the Drookit tunes? You can download their tracks for free – with demos directly from their website www.drookitdogs.com.
To make it easier for people to find your broadcast - and let’s face it, make it look prettier - we are switching to “friendly” URLs meaning that your broadcast will have a link in the style of www.selfcast.com/yournickname rather than lots of letters and digits. Yay!
You can now schedule your broadcast and get featured on our main page. You may have noticed a new feature on our home-page at selfcast.com. We now feature events that you schedule on our main page. So go to “my account”, and put in the time-and-date for your show and it will appear in the coming up countdown on our site - thereby getting YOU more audience!
Get featured in our TV guide and eNews for FREE? If you want to get your TV or radio channel featured in our newsletters for free, then e-mail your broadcast schedule, a picture, and a brief description of your Selfcast to editor@selfcast.com.
If you have any problems - don’t forget there’s always our Selfcast Support Forum, which provides solutions to most issues. If you experience any issues that you do not find answered in our support forum, feel free to e-mail us at help@selfcast.com.
TV Networks Flex Web Muscles
Excerpted from MediaPost Report
Television executives are convinced that the bigger opportunity for their industry is not digital downloads but streaming their programs over the Internet with advertising. The networks began to experiment with streaming video last year. An ABC survey in August 2006 found that 84% of viewers believed they were getting “a great deal” by being allowed to stream programs for free, even if it meant advertisements could not be skipped. The network also found that 87% of respondents were able to recall which advertisers had sponsored particular episodes.
Other studies indicate that giving people more outlets on which to watch television is increasing consumption. This season, streaming is moving beyond testing to widespread adoption. A key change for the networks is that the programs will be available to consumers not only on their own Web sites but through a variety of partners. Several industry observers saw Disney’s agreement last week with AOL to show programs such as “Desperate Housewives” as a watershed moment.
In spite of the industry’s optimism, there are still plenty of concerns about streaming. A major one is its possible impact on the $4 billion syndication business, where television studios have traditionally cashed in on hit programs by selling them as re-runs. Streaming video to large numbers of consumers is also taxing on Internet infrastructure and costly. There also are likely to be more tensions between the media companies that create content and the technology partners that distribute it. Please click here for the full report in the Financial Times.
Hollywood Preps for P2PTV
Excerpted from eMarketer Report
Some film industry pundits feel Hollywood is reeling down. The key revenue streams that have traditionally driven the Hollywood economy – box office receipts and DVD sales and rentals – have hit a plateau.
“The formulas that the industry relied on for years to get consumers into theaters are no longer as effective as they once were,” said Paul Verna, eMarketer Senior Analyst and author of the new report, Digital Movie Marketing: Engaging the Online Audience.
“There is a growing sense that the studios’ core audience of 12-to-24 year-olds does not respond to newspaper advertising and is increasingly tuning out TV commercials through the use of DVRs and other time-shifting devices,” he said.
Since Hollywood has no choice but to engage this audience, online marketing is becoming more important in the overall mix.
“In 2006, studios spent an average of 3.7% of their marketing budgets on Internet advertising,” Mr. Verna said. “While that is a small fraction, it is on the increase, and eMarketer projects that by 2011, an average of 11% of film marketing budgets will go toward new media channels.”
“Any advertiser marketing to the 12-to-34 age group is finding it more challenging to reach those people through traditional media,” Vince Messina, National Director of Entertainment Sales at Microsoft Digital Advertising Solutions, said in an interview with eMarketer.
“That customer is harder to find through print and television,” he said. “So the challenge that studios have is, ‘How do we get to that audience, which is the lifeblood of the movie audience?’
“Well, they spend a heck of a lot of their time playing games, instant messaging, and going on social networks,” Mr. Messina said. “Studios are paying greater attention to how to get the eyeballs that matter the most.”
The growth in online advertising by studios is likely to come at the expense of traditional media such as network TV, spot TV and newspaper advertising, all of which showed net declines between 2002 and 2006, according to the Motion Picture Association of America (MPAA).
“From the studios’ perspective, their online marketing efforts will be directed at their primary objective: to excite as much advance interest in films as possible and get the masses into movie theaters on opening weekend,” Mr. Verna said. “If Hollywood can succeed in leveraging new media channels toward that goal, ancillary revenue streams – whether through conventional or high-definition DVDs, download or streaming services – will fall into place.”
To get the whole picture, please read the new eMarketer report, Digital Movie Marketing: Engaging the Online Audience.
British Online TV Set to Take Off
The UK market for online TV will be worth $362 million by 2011 – but the growth of movie downloads is expected to be much slower.
These are the findings of a survey by Screen Digest, which forecasts that music will continue to dominate UK online distribution in the immediate future. This is predicted to grow from last year’s $90 million to $571.2 million by 2011, when Screen Digest estimates that 191 million singles and 21 million albums will be downloaded.
Despite a slow start, the online TV market is expected to generate annual revenues of $362 million in Blighty by 2011.
In the UK, online TV sales are in their infancy but it is forecast that as more services launch online, TV will become an increasingly popular way to catch up on soaps, dramas and reality skeins – and for audiences to preview their favorite shows.
Arash Amel, Senior Analyst for Screen Digest, said: “Broadcasters and pay TV operators will come under increasing pressure from many major ‘virtual networks,’ such as YouTube and Joost, who will be competing for viewers’ time and attention.
“This will be exacerbated by hardware manufacturers, such as Apple, Microsoft and Sony, who will be far more adept at selling TV shows because of their existing device relationships with the consumer.”
Online movies will grow more slowly, Screen Digest believes, because consumers are reluctant to watch three-hour-long pics on their PCs, preferring to enjoy them on their plasma screens and home-entertainment systems.
VeriSign Completes Key Milestones
Excerpted from CNNMoney Report
VeriSign, the leading provider of digital infrastructure for the networked world, has completed key milestones and is on track to expand and diversify the capacity of its critical Internet infrastructure by 10 times by the year 2010.
When VeriSign announced the Project Titan initiative in February, it focused on expanding VeriSign’s critical infrastructure in scale, location, and investment in new engineering, monitoring and security systems to support the growth in Internet traffic. Since then, VeriSign has increased its capacity to 2 trillion DNS queries a day, continued to diversify its infrastructure globally and created new tools and processes to better monitor and manage traffic and to implement various system upgrades.
Project Titan is a multi-year initiative to strengthen the critical Internet infrastructure. These upgrades are vital to managing the surge in Internet interactions and protecting against cyber attacks that are growing in both scale and sophistication.
“If the Internet infrastructure is not continually fortified and strengthened, then we run the risk that it will be unable to support the growing and dynamic needs of users, businesses and governments that rely on that infrastructure every day for commerce, communications and operations,” said Ken Silva, Chief Security Officer, VeriSign. “For the Internet to remain a trusted platform, there must be complete confidence that it can scale to meet the demands and protect itself against attacks by those who want to disrupt it.”
VeriSign manages the critical infrastructure that handles registration and resolution traffic for the .com and .net systems. In doing so, VeriSign continues to experience heavy demand, processing a peak of more than 30 billion Domain Name System (DNS) queries per day in the second quarter. A DNS query occurs every time an Internet user clicks on a web site, checks email or engages a computer application that utilizes the .com and .net infrastructures. This does not include the vast number of computers that communicate with each other via automatically generated DNS queries. VeriSign additionally operates the “A” and “J” root servers, which serve as the central directory to route Internet traffic to other top level domains.
Internet technology has transformed personal communications, banking and finance, government process, and manufacturing – indeed, the economic, social and political life of industrialized economies. The growth of Internet users, broadband capacity and number of Internet-enabled devices has created an opportunity for hackers, organized criminals and even more serious terrorists to attack our networks.
Cyber abuse – SPAM, spyware, identity abuse, viral attacks, and denial of service exploits – often involve hijacked PCs and other devices, now linked through broadband connections, and the use of that bandwidth to launch attacks on the Internet infrastructure. A series of serious attacks in the last two years reflect how these incidents have grown in frequency and sophistication – some 100 times more threatening than attacks conducted just years before.
VeriSign is developing next-generation monitoring and response services that will help better manage .com and .net traffic and better protect the systems against cyber threats. The monitoring systems will rapidly diagnose Internet traffic anomalies, which often appear in advance of a cyber attack, enabling pre-emptive action to minimize impact. VeriSign will also implement new DNS security protocols to better protect Internet traffic.
CacheLogic Accelerates Expansion
Excerpted from TechWhack Report
CacheLogic, provider of the world’s leading Digital Asset Delivery Network, a new generation content delivery network (CDN) designed from the ground up to offer unparalleled online delivery performance, economics, and control for owners of large digital assets including video, downloadable software, and videogames, announced further expansion with the opening of its London office in the UK. The new office is located within walking distance of London Victoria Station and provides a base for the company’s rapidly expanding sales, marketing, operations, and management team.
This move is indicative of CacheLogic’s accelerating growth worldwide and builds on the recent strengthening of the executive team, the launch of major enhancements to the company’s Velocix 2.0 Digital Asset Delivery Network, and partnership announcements with Microsoft and Adobe.
CacheLogic CEO Phill Robinson said, “Alongside continued investment in our unique network infrastructure, our new office will enable us to accelerate our business development efforts with global media corporations based in London. This expansion reinforces our commitment to better serve the needs of those who are in the business of delivering next generation video and rich media content over the internet. It also provides us with an excellent base from which to hire the best talent in the industry, alongside our headquarters in Cambridge.”
Microsoft PlayReady for P2P Silverlight
Excerpted from Streaming Media Magazine Report by Christopher Levy
Microsoft announced its PlayReady in early 2007, and will make the new DRM technology widely available to content publishers in the first half of 2008. Recently, I had a chance to sit down with Adam Berns and Jim Alcove, both Senior Directors at Microsoft who are responsible for the business and technology aspects of PlayReady. Berns and Alcove were kind enough to provide Streaming Media Magazine with an exclusive question-and-answer session about PlayReady and insight into Microsoft’s DRM strategy.
You made a big splash this week at IBC with the launch of Silverlight. How does PlayReady fit into the Silverlight story?
Berns: Silverlight will deliver digital rights management (DRM) support built on Microsoft PlayReady technology. PlayReady helps complement a broader distribution-and-accessibility-to-content story, providing business model support for content providers. That, coupled with our existing Windows Media technology, makes PlayReady a really good fit for Silverlight scenarios. We think our work in the mobile handset space and our work with Silverlight are the crux of getting this technology in front of consumers, whether it be on the web or on handsets.
Could you tell us a little more about the feature set that PlayReady will offer and some early partners and adopters you are working with?
Berns: PlayReady is the result of extensive feedback that we received from our handset manufacturer partners and our existing industry partners and content owners and licensees. We listened to that feedback and partnered with our existing customers to enable new scenarios and bring an offering to market with them. Our main goal is to help our customers reach their goals of building out their services and new handsets deployments. We announced at the 3GSM Conference in Barcelona in February that we already have several key partners in the PlayReady rollout, including Telefónica, O2, Verizon Wireless, Bouygues Telecom, and Cingular Wireless, now the new AT&T. Then, in August of this year, Nokia announced support for Microsoft PlayReady in the Nokia S60 and Series 40 mobile device platforms, starting in 2008.
Alcove: From a feature perspective, PlayReady adds support for domains, which allows content to move seamlessly among a user’s devices and PCs. In addition to support for Windows Media codecs, PlayReady also supports non-Windows Media codecs such as H.264 and AAC, and non-audio/visual content like bitmaps for backgrounds, games, maps, and ring-tones, which differentiates it from existing technologies in the marketplace today. A very important point is that PlayReady is backwards-compatible with Windows Media DRM 10. As a result, device manufacturers can build PlayReady devices that are compatible with existing Windows Media DRM 10 content and services such as Napster, CinemaNow, Amazon, MovieLink, and so on.
Will PlayReady ultimately replace Windows Media Rights Manager (WMRM), or do you see it as a complementary technology in the marketplace? What gaps in the WMRM ecosystem will PlayReady fill?
Berns: Windows Media DRM 10 is a technology that we will continue to support. From a pricing perspective and from a feature set perspective, PlayReady is a different value proposition. Windows Media DRM is clearly audio/video-focused, while PlayReady offers many more features including non-audio/video content, domain support, support for non-Windows Media audio/video codecs, etc., at a different price point. And of course PlayReady also provides backwards compatibility with Windows Media DRM 10. We believe PlayReady hits the sweet spot for value and price.
Alcove: You can certainly look at PlayReady’s usage model as an evolution of Windows Media DRM. Consumers are sensitive to what they feel are unnecessary restrictions on their use of content. When you look at domain-based licensing, such as PlayReady supports, it provides a more seamless model for users to move content around the ecosystem and enables native support for what service providers today try to emulate using Windows Media DRM. We see mobile phones becoming a large part of the ecosystem of consumer entertainment devices, which is a space that PlayReady very efficiently addresses. PlayReady enables the adoption of flexible business models for delivering all kinds of digital goods to consumers, extending content access technology beyond Windows Media Audio and Video.
How does PlayReady fit into the overall future of Windows Media? Should we expect to see PlayReady-compatible DVD players and car stereos and video game consoles?
Alcove: In order for consumers to fully realize the value of digital content they need access to a broader variety of content types and business models. Having a wide array of devices within an ecosystem, ready to support that content, is necessary to achieve that value. That is really our focus with PlayReady. Initially our focus is on mobile devices and content, but we will expand this over time. It is important that as we grow the constituency of devices that we are cognizant of the need to maintain a consistent user experience. We feel this is incredibly important. The consistent user experience must be maintained to be successful.
Berns: We think the applicability of PlayReady and of Microsoft’s DRM technology in general is definitely not just PC-based and not just focused on handsets. We are absolutely thinking about other places where this technology is applicable and we will continue to analyze these opportunities as we evolve.
What were some of the major hurdles you encountered as you went down the road to launching PlayReady?
Berns: Over the years we have received a lot of useful feedback on Windows Media DRM. This was the genesis of PlayReady. DRM is generally a complex area, given the ever-increasing expectations of consumers and the evolving needs of the industry. Our challenge with PlayReady was to build on our existing presence in the DRM space with a new technology that met these next-generation needs – both of the industry and of consumers.
Alcove: PlayReady is really about taking a look at what did and did not work with the existing technology, and what additional consumer scenarios the industry was looking to deliver. We originally shipped DRM technology in 1999 and have learned a lot about what has and has not worked over these past eight years. The PlayReady offering is the result of this introspection, dialogue with partners, and a lot of work to come up with the right feature set that provides a seamless experience for consumers while creating a great opportunity for our partners to build new and exciting services based on digital goods.
Now that PlayReady has been announced, should the market interpret PlayReady as a change in Bill Gates’ position on DRM?
Berns: We look at PlayReady as one element in improving the customer experience with digital content. There are a lot of other technologies that come into play in order to deliver truly compelling user experiences; we wanted to make sure that whatever the nature of those experiences, PlayReady can support the digital content types and business models in ways that make sense for consumers and content owners alike. Our efforts in this space continue to be very cooperative ones with studios, labels, content and service providers, device manufacturers, and others in the industry.
Please click here for more information on PlayReady. Christopher Levy (clevy@buydrm.com) is CEO & Founder of BUYDRM, a pay-media services provider with offices in Austin, Los Angeles, and New York.
P2P Service to Market MP3 Players
Excerpted from Digitimes Report by Harris Lin
Darling Digital Technology, the operator of the P2P online music platform ezPeer+ in Taiwan, will sell Kuro branded MP3 players in the Taiwan market starting in late October 2007 at a tentative retail price of $91.
The Kuro MP3 player is also customized with built-in software to match the operation of Kuro.cn, an online music download platform in China, according to industry sources in Taiwan.
While ezPeer+ has a stock of one million songs, only 5,000 songs are currently under license, Darling Digital noted. However, Darling Digital indicated it has been negotiating copyrights for more songs.
Broadband Taxman
Excerpted from Wall Street Journal Report
For Internet users, the scariest night of this year may fall on the evening after Halloween. On November 1st, the federal Internet tax moratorium is due to expire, and no committee in Congress has acted to make it permanent.
Last Thursday, prodded by a flurry of GOP press conferences, Senate Majority Leader Harry Reid issued a two-line statement saying that he had “every expectation that Congress will approve a continuation of the moratorium.” Not exactly a passionate call to protect America’s 213 million Internet users. Commerce Chairman Daniel Inouye added later that he’s “hopeful” his committee can move a bill this week and he has scheduled a Thursday markup.
Listening to recent Democratic talking points on the economy, you might wonder why Congress isn’t all over this issue. Democrats say they want to make the tax system less “regressive,” if only they could get something past President Bush’s veto pen. Here’s an opportunity to prevent imminent tax increases on poor and middle-class consumers, and the President is ready to sign it. As an additional benefit, Democrats can avoid presiding over the Congress That Taxed The Internet. Recognizing the political vacuum, former New York Mayor Rudy Giuliani endorsed the Net tax ban to thunderous applause at a Friday event.
Yet the Senate’s Mr. Inouye is planning to bring up only the four-year extension authored by Delaware Senator Tom Carper, a bill that invites governors and mayors to try to slap new taxes on some components of Internet access service, while claiming that the finished product remains tax-free. The better bill is the robust, permanent ban championed by Democrat Ron Wyden and Republicans Wayne Allard, John Sununu, and John McCain.
Meanwhile, on the House side of the Capitol, action has been held up in the Judiciary Committee by an unrelated dispute over satellite TV. The good news is that Chairman John Conyers helped extend the law in 2004, and is now crafting a bill. The bad news is that lobbyists for state and local government are pressuring him to write a short-term extension, instead of the permanent ban he has previously supported and that is now included in California Democrat Anna Eshoo’s bill, which at 177 co-sponsors clocks in as the most popular approach.
The Internet Tax Freedom Act, enacted in 1998 and since extended twice, prevents multiple and discriminatory taxes on the Internet. In other words, different states can’t tax the same e-commerce transaction, and states and cities can’t create Internet-only taxes that don’t exist offline.
So, except for a few grandfathered states, Internet access taxes are banned.
But a Congressional failure to extend the moratorium would quickly show up on monthly bills, and not quietly. Taxes on telephone service can run above 20%, more than triple the average general sales tax rate. Absent the moratorium, state revenue departments will begin to issue letters ruling that Internet access services are subject to these same sky-high telephone tax rates. The revenuers will do this because they can (until state courts judge their merit), not because they need the money. State and local governments have enjoyed 17 straight quarters of increasing revenues.
Unable to show that the tax ban hurts states and localities, moratorium opponents are now trying out a new argument: Yes, taxes will raise the price of Internet access services, but consumers don’t care about price. Right. Congressional staff tempted to buy this line should remember that they’re the ones who will have to answer the phone when consumers start seeing the new charges.
The indirect impact on constituents could be even more significant. A July 2007 Brookings Institution study found that for every 1% increase in broadband penetration, America adds about 300,000 jobs. Harvard economist Dale Jorgenson has found that, ironically, the Internet’s greatest economic benefits have actually occurred since people stopped talking about them. “Although the Internet was commercialized in 1995, its main impact on the U.S. economy has occurred since the dot-com crash in 2000,” says Mr. Jorgenson in a recent email. “The pace of innovation has accelerated considerably and shows no signs of weakening.”
A permanent ban should be a political lay-up. But the clock is winding down and Congress needs to take a shot.
RIAA's Day in Court Nearly Over
Excerpted from Motley Fool Report by Anders Bylund
The music industry’s lawsuit crusade against defenseless college students and housewives appears to have hit the skids lately. That might mean it’s almost time for socially responsible investors to start looking at music companies again, after their long industry-wide hiatus from research lists.
Warner Music, Sony BMG, Universal Music, and EMI, the main movers behind the Recording Industry Association of America (RIAA), may have expected easy victories when they began their much-maligned campaign to sue alleged illegal music downloaders. But instead of settling their cases for a few thousand dollars each, many defendants decided to fight back – with great success.
Some lawsuits have proven ridiculous from the outset, targeting computer-illiterates and dead people, or accusing grandmothers of downloading gangsta rap. Others have been dismissed for a lack of evidence against the purported file-sharers. Nearly every standard weapon in the recording industry’s legal arsenal has been proven ineffectual at best, and unconstitutional at worst.
Flat-fee subscription services like the revamped Napster and RealNetworks’ Rhapsody, as well as pay-per-download distributors like Apple, can’t wait to see the old-fashioned music distribution networks go down in flames. Consumers in general are honest, law-abiding people, and as long as you give them a chance to get what they want by legal means, and at a reasonable price, piracy will be a niche phenomenon. Today, the opposite is true, thanks to draconian licensing policies and a wrong-headed take on the law. But that’s all about to change.
If you follow this legal saga at all, you know that the RIAA members have lately been fighting primarily to avoid paying the defendants’ legal fees – and losing.
Instead of a quick and easy cash machine, the labels’ lawsuit machine has become a costly public relations disaster, and it seems unlikely that any sane and responsible manager would order the madness to continue much longer.
Support for the lawsuits from artists and their representatives seems lukewarm, with a few high-profile exceptions like Metallica. And it’s easy to see why the lesser lights of the Billboard charts don’t swarm to the cause: Spreading your music like wildfire across the globe, for free, can be a brilliant word-of-mouth marketing tool.
The Timberlakes and Aguileras of the world, on the other hand, do have something to lose. Their names are already well-known, and free downloads can cut into their profits more than they increase their market presence. These are the golden calves of the music industry, the acts for whom the RIAA is really fighting. Not to reimburse those artists for lost wages, mind you – just to protect their own easy profits.
The legal system has a role to play in the music business, particularly in protecting copyrights and trademarks from profit-taking, mass-producing pirate shops and so forth. But John Doe filings against nameless IP addresses is wrong on so many levels that I can’t list them all in this brief space. Let me just name a few of the most important flaws:
It’s a great way to alienate music fans, with very little payoff. The lawsuits have so far failed to stem the illegal downloading tide, and the costs must rival the settlement payoff by now.
Even if the Internet service provider (ISP) keeps very detailed access logs, it’s nearly impossible to prove that a certain IP address was used by a particular person at any given time.
Copyright is meant to encourage the creative process, not to fatten corporate coffers or limit the available means of distribution. Again, we haven’t seen any payouts to the actual artists and composers here, only to legal teams and company bankrolls.
It’s about time for the Luddite music business to come around to the new realities of the media market. They’ve spent a lot of money on payola to get their chosen mainstream fodder played on the radio. If the computer is the new radio, why should they spend even more money and effort trying to stop that music from being played for free?
A less restrained distribution model would move some of the control from the music industry’s hands and into the consumer’s, which would be great news for a plethora of struggling, hopeful rockers and popsters. I’m thinking “paradigm shift” here -- the end of massive superstars, and the rise of music for the people, by the people, and of the people.
It’ll mean lower marketing costs, since the music speaks for itself; lower distribution costs, as a meaningful all-digital model takes the place of physical discs; and freedom for everyone to find their own favorites with a click of the mouse, rather than being told what to like. Everybody wins.
Coming Events of Interest
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Digital Music Forum West – October 3rd–4th in Los Angeles, CA. The seventh annual Digital Music Forum event now at the newly renovated Hollywood Roosevelt Hotel. Several DCIA Member company executives will be featured speakers and the DCIA will present a special session on “The Evolution of P2P and Music” with BUYDRM’s Christopher Levy, FTI Consulting’s Roger Scadron, Javien’s Leslie Poole, PeerApp’s Mark Strangio, and VeriSign’s Stuart Cleary.
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PT/EXPO COMM – October 23rd-27th at the China International Exhibition Center in Beijing, China. The largest telecommunications/IT industry event in the world’s fastest growing telecom sector. PT/EXPO COMM offers DCIA participants from all over the world a high profile promotional platform in a sales environment that is rich in capital investment.
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P2P ADVERTISING UPFRONT LA – Sponsored by the DCIA October 29th in Los Angeles, CA in conjunction with Digital Hollywood Fall. The industry’s premiere marketplace focused on the unique global advertising, sponsorship, and cross-promotional opportunities available in the steadily growing universe of open and closed P2P, file-sharing, P2PTV, and social networks, as well as peer-assisted content delivery networks (CDNs).
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Streaming Media West – November 6th–8th in San Jose, CA. Streaming Media conferences have become the premier online video events in the world. Streaming Media West is totally focused on the business and technology of online video. The DCIA will participate featuring industry leading P2PTV providers and support services.
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P2P MEDIA SUMMIT LV – January 6th in Las Vegas, NV. This is the DCIA’s must-attend event for everyone interested in monetizing content using P2P and related technologies. Keynotes, panels, and workshops on the latest breakthroughs. The Conference will take place in N260 in the North Hall of the Las Vegas Convention Center and the Conference Luncheon in N262-264. This DCIA flagship event is a Conference within CES – the Consumer Electronics Show.
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CCNC 2008 – The Fifth Annual IEEE Consumer Communications & Networking Conference, January 10th-12th at Harrahs, Las Vegas, NV. Now co-promoted by the DCIA. The latest research developments and technical solutions in the areas of home networking, consumer networking, enabling technologies (including middleware), and novel applications and services. See www.ieee-ccnc.org for details.
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P2P ADVERTISING UPFRONT NY – Sponsored by the DCIA March 11th in New York, NY in conjunction with the Media Summit New York (MSNY). The industry’s premiere marketplace focused on the unique global advertising, sponsorship, and cross-promotional opportunities available in the steadily growing universe of open and closed P2P, file-sharing, P2PTV, and social networks, as well as peer-assisted content delivery networks (CDNs).
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