June 11, 2007
Volume 18, Issue 1
P2P MEDIA SUMMIT LA This Monday
Don’t’ miss the P2P MEDIA SUMMIT LA this Monday, June 11th, at Doubletree Guest Suites Santa Monica. Please click here for more information and here to sign-up.
This is a must-attend event for everyone interested in exploring growth opportunities associated with the most popular and rapidly advancing technology for digital media distribution, and gaining valuable insights into the fast-developing P2P industry. The newest phenomenon, peer-to-peer television (P2PTV) will be a major focus of this Conference.
Joost Gets Boost with New CEO Mike Volpi
Joost, the industry-leading P2PTV service, confirmed the appointment this week of Mike Volpi as its new CEO. Mike served most recently as a senior executive at Cisco Systems, where he has worked for the past thirteen years.
Joost now has more than 500,000 beta subscribers, approximately 100 employees, and many media partners and content providers. Joost was created by Niklas Zennstrom and Janus Fris, the founders of two earlier market-leading implementations of P2P technology, Kazaa and Skype, with whom Mike became acquainted while serving on Skype’s Board of Directors.
Please check out the NY Times and LA Times coverage of Mike’s move; and scroll down for Om Malik’s interview with him on the transition from Cisco to Joost.
Babelgum Gets More Fabulous with New Beta
Babel Networks this week launched its new beta release for Babelgum, its up-and-coming P2PTV service. It’s a whole new version, a major rewrite to improve performance – and with several new features. This release also showcases hundreds of hours of content, with much more to come in the next few weeks.
You can download the new Babelgum beta now by logging onto the new site. After login you will be able to download the application.
If you previously have been using Babelgum, the first time you launch the new version you will have to sign up again. The new login and password will be valid for both the application and the site. Right after that you can start watching your favorite content and invite friends to try Babelgum.
For additional help, you can contact Babel at support@babelgum.com.
Babel Networks looks forward to receiving your feedback and further improving the service. You can submit your feedback to betatest@babelgum.com
Oversi Makes Public US Debut
Excerpted from MultiChannel News Report by Mike Robuck
Oversi is making its public debut in the United States this month.
Oversi’s OverCache solution is designed to offload the P2P traffic that can clog up ISP interconnect links. The asymmetrical nature of ISP networks can lead to bottlenecks with heavy P2P traffic, according to Eitan Efron, Oversi’s Vice President of Marketing. P2P applications used to distribute video content, for example, can generate large amounts of symmetrical traffic and consume the uplink capacity of ISP networks and also reduce service levels.
Service providers can compress video to meet the demand, but that can affect quality; and adding more equipment, such as cable modem termination systems (CMTSs) or a backbone upgrade, can be costly.
"Our caching solution acts like a water tower to the head-end, or to the data center," Efron said. "It connects to a router port and learns the network, based on grid computing, as it becomes part of the P2P network. It relieves pressure on interconnects because a user doesn’t need to go outside for content because the most popular content is stored by OverCache."
With a 95 percent byte-hit ratio, OverCache delivers users’ P2P traffic while using 5 percent of the bandwidth from international connections. From the revenue side, service providers can offer extra bandwidth for premium customers for additional rates without incurring any additional costs. The solution also allows service providers to set-up their own content delivery networks (CDNs) if they choose. Efron said one rack unit typically serves a medium-sized service provider, but it can scale up with additional blades as P2P traffic grows. "The statistics are better for Tier 1 and Tier 2 providers," he said.
The OverCache system has 20 deployments worldwide and is in trial with several large US operators.
Report from CEO Marty Lafferty
 We hope to see you at P2P MEDIA SUMMIT LA and Digital Hollywood Spring kicking off Monday June 11th.
Click here for the full agenda, here for a list of speakers, and here to register for P2P MEDIA SUMMIT LA. It’s not too late to sign-up online.
If you register for Digital Hollywood Spring at the same time, you can optimize your savings.
Don’t miss out on this opportunity to gain a fresh perspective from the front line of the digital media revolution. P2P now accounts for over 70% of all Internet traffic and is just beginning to be harnessed for licensed content distribution.
The P2P MEDIA SUMMIT LA features keynotes from top P2P software distributors, panels of industry leaders, and a special session on DRM interoperability. There will be a continental breakfast, luncheon, and networking cocktail reception with live entertainment.
Keynote speakers will be INTENT MediaWorks’ Glenn Martin, VeriSign‘s Jeff Richards, FTI Consulting’s Bruce Benson, Joost & Babelgum analyst Janko Roettgers, QTRAX’s Allan Klepfisz, Raketu’s Greg Parker, Wambo’s Xavier Casanova, and Pando Networks’ Robert Levitan.
Conference luncheon speakers will be BitTorrent’s CEO & Co-Founder Bram Cohen and the National Association of Television Arts & Sciences’ (NATAS) President Shelly Palmer.
The Policy Track features Vandenberg & Feliu’s Ray Beckerman, PeerApp’s Frank Childs, TAG Strategic’s Ted Cohen, MasurLaw’s Steve Masur, and Dreier LLP’s Joshua Wattles, and will address the post MGM v. Grokster world – new rules for P2P.
The Technology Track features CacheLogic’s Gary Croke, Oversi’s Eitan Efron, BigChampagne’s Eric Garland, P2P Cash’s Tom Meredith, and PodZinger’s Tom Wilde, and will address P2P file sharing – the evolving distribution chain.
The Marketing Track features Skyrider’s Ori Cohen, Ultramercial’s Dana Jones, MediaDefender’s Jonathan Lee, SafeNet’s Nicole Pearson, and Javien’s Leslie Poole, and will address P2P business models – what’s working and what’s not.
The Content Distribution panel features Paramount Pictures’ Derek Broes, The Independent Comedy Network’s Marc Campbell, MediaPass Network’s Daniel Harris, Revver’s Brian McCarthy, and Nettwerk Music Group’s Brent Muhle, and will address the perspective of artists and rights holders – P2P for content creators.
The Solutions Development panel features Digital Containers’ Mike Farley Abacast’s Michael King, AT&T’s Charles Kalmanek, Unlimited Media’s Memo Rhein, and Grooveshark’s Sam Tarantino, and will address advancement – creating the commercial P2P ecosystem.
Entriq’s Steve Condon, BUYDRM’s Christopher Levy, the Motion Picture Association of America’s (MPAA) Krishnan Rajagopalan, Digimarc’s Stuart Rosove, and Philips’ Jim Ward, and will conduct a special closing session on DRM Interoperability.
The live showcase entertainer for the post-conference networking cocktail reception will be Shotgun Honeymoon.
Please register online at www.dcia.info/P2PMSLA2007/register.html or by calling 410-476-7965. We look forward to seeing you on Monday. Share wisely and take care.
Net Ad Rev Soars to $5 Billion in 1Q
Excerpted from PwC/IAB Internet Advertising Revenue Report
The Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC) this week announced that Internet advertising revenues reached a new record of $4.9 billion for the first quarter of 2007. The 2007 first-quarter revenues represent a 26% increase over 1Q 2006 at $3.8 billion and a 2% increase over the fourth quarter of 2006 at $4.8 billion.
"The recent results are particularly impressive when the size of the advertising revenue base is taken into account," said Peter Petrusky, Director, PwC. "Given these results, we may expect continued strong revenue growth buoyed by an expanding broadband subscriber base, which could translate into more users spending more time online. Broadband offers a platform for rich media and video ads that dial-up connections can’t render."
Five Questions for New Joost CEO
Excerpted from GigaOM Report by Om Malik
Mike Volpi was rumored to be the choice for new CEO of Joost for quite a while, and the company confirmed the news this week. We had a chance to catch up with Volpi, one of the rising stars at Cisco Systems, and talk with him about his decision and his plans for Joost, a P2PTV company started by Kazaa and Skype co-founders Janus Friis and Niklas Zennström that recently raised $45 million in funding from investors such as Sequoia Capital.
Here are excerpts from an interview conducted earlier today.
OM: Mike, you were one of the rising stars at Cisco. Why leave, and why decide on Joost?
MV: Routers are great, but you can’t do that forever and I wanted to get on the ground floor of something unique. I never thought of myself as the router guy, and had broader interests. I come from the infrastructure side but I hate to pigeonhole myself. I had a lot of things come my way, but Joost interested me the most. I have known Niklas and Janus for a while, and was excited about what they were doing with Joost. I think great companies are built when the market opportunity comes together with a great team. That is Joost.
OM: Why do you think the time is right for Joost?
MV: I think there are three things that have come together. Content owners have realized what happened to the music industry and have embraced the Internet. I think that development combined with broadband – and the P2P technology platform – are what make Joost’s timing right.
OM: Joost isn’t the only online video player in the running – and there are many options out there. So why should we think Joost will win.
MV: Joost is not YouTube and Joost is not Apple iTunes. Joost is a service that delivers high-quality ad-supported long-form produced video content in a secure manner using a cost-effective delivery platform. Bringing these three pieces (long-form video content, advertising, and delivery platform) together is going to be hard and not everyone is going to be able to do it. No one has it packaged together like Joost.
OM: Is lack of upstream bandwidth and the current debate around network neutrality of concern to you? After all, some of your offerings will compete with the TV offerings of cable and phone (IPTV) companies.
MV: The way our system is designed, I don’t think upstream bandwidth is going to be a problem. It is designed along the lines of BitTorrent. On the issue of network neutrality, we have a totally legitimate service and the carriers shouldn’t have a reason to block us. I don’t think the regulatory environment in the US and elsewhere will allow for the blocking of competitors to the carriers.
OM: Is there a chance we will see Joost on AppleTV?
MV: We would love to put Joost on the Apple TV platform. We know we can make it run on any operating system.
Tribler Takes P2P to the Web 2.0 Generation
Excerpted from The Register Report by Cade Metz
Here comes "BitTorrent 2.0." Researchers at the Delft University of Technology and De Vrije Universiteit Amsterdam recently unveiled the latest version of a new-age BitTorrent client known as Tribler, part of an effort to "move P2P to the next generation."
Tribler 4.0 lets you search YouTube, and also offers a revamped interface that borrows a few tricks from both YouTube and the popular music recommendation service, Last.fm.
"In the past, P2P was all about file sharing and keyword search," said Johan Pouwelse, an Assistant Professor at Delft University. "We’re working towards true content sharing, a system that gives you the sort of visual browsing you have on YouTube and the community feeling you have on FaceBook or MySpace."
The new Tribler client recently received a "thumbs-up" from Ernesto, the man behind the P2P weblog TorrentFreak - though he admitted to being "a little biased." Like Tribler, Ernesto was "made in Holland."
Tapping into LiveLeak, as well as BitTorrent and YouTube, Tribler lets you browse for videos via thumbnail images as well as keywords. It offers a Last.fm-esque recommendation engine that suggests videos based on your download habits and shares your tastes with the web at large. And thanks to a video-on-demand (VOD) option, you can begin watching clips even as they’re downloading. With some added code, you can also search additional video sites. "All you need to do is change a few logical expressions," Pouwelse explained.
According to Ernesto, "Most functionalities are still in the experimental phase. If you’re concerned about speed and memory use as well as features, I would recommend sticking with a client like utorrent."
As of this week, 20 researchers across the two universities are working on the project, and Version 4.1 is due later this summer. In the year since Tribler first hit the Web, according to Pouwelse, the client has been downloaded more than 130,000 times.
Tribler is funded in part by the Dutch Freeband Program, a research-centric project under the aegis of The Netherlands’ Ministry of Economic Affairs.
AllPeers Offers Mozilla Firefox Bundle
AllPeers, a software vendor specializing in private media sharing networks announced this week the immediate availability of Mozilla Firefox-with-AllPeers. This software bundle combines the Firefox web browser and the AllPeers P2P add-on in a single download. Providing these two award-winning, open source applications together simplifies the establishment and growth of browser-based, private file-sharing networks and turns Firefox into a social web browser.
AllPeers adds social networking and file sharing capabilities to the Firefox user experience. Prior to the release of this bundle, AllPeers was only available to existing Firefox users. New users were required to download Firefox prior to installing AllPeers. With the introduction of Firefox-with-AllPeers, new users can now simultaneously switch to the world’s best browser and gain the advantages of AllPeers private file-sharing features.
"Approximately 10% of new AllPeers users download Firefox in order to install our application," explained Cedric Maloux, CEO & Co-Founder of AllPeers. "The popularity of our application’s features has helped AllPeers achieve an organic growth rate of one new user every two minutes, and we expect this rate to accelerate considerably with the added ease of installation afforded by the new bundle. We’re excited to make it even easier for new users to experience AllPeers and Firefox."
AllPeers is a popular Firefox add-on that allows users to browse the shared files of their friends and family in the same way that they would browse normal web pages. Since its launch eight months ago, the AllPeers Firefox add-on has generated more than 350,000 unique downloads.
The application leverages its own secure implementation of the popular BitTorrent protocol to transfer files among users, eliminating the need to upload files to a central server and enabling users to share files and web pages with friends and family, privately and securely. Unique "Drag-and-Share" functionality and encrypted chat have also helped propel AllPeers to widespread popularity.
"AllPeers is extending Firefox in meaningful ways for our users by delivering integrated file-sharing capabilities," said Christopher Beard, Mozilla’s VP of Marketing and Product Management. "Their release of Firefox with AllPeers demonstrates the virtuous cycle enabled by the Firefox platform: users and developers both benefit from the open architecture of our add-ons ecosystem."
The release of Firefox with AllPeers coincides with the introduction of new AllPeers features that reinforce the bundle by making it easy to share with users who don’t yet have AllPeers. These new capabilities enable AllPeers users to import contacts from leading e-mail programs and share files directly with other users by entering their e-mail addresses.
Mozilla Firefox-with-AllPeers is available immediately and can be downloaded at www.allpeers.com.
Anubis P2P Launches This Week
Excerpted from CNET Asia Report
Anubis P2P is a new file-sharing program that includes all the recent P2P optimizations, helping users to search and download over several networks (including eD2K and Kad) around the Internet.
All-in-one features like file manager, download statistics, chat, and IP filters make this P2P application a complete tool for all kinds of users. Anubis P2P users can monitor all their activity in statistics-area-viewing download/upload reports gathered by Anubis.
This software comes with the Dealio toolbar for Internet Explorer that can be installed or uninstalled at the user’s choice.
Lala.com Offers Online Music Sharing
Excerpted from Sci-Tech Today Report by Barry Levine
Tired of carrying that tiny little iPod around? A new web-based service can make your iPod virtual. Lala.com, which began as a CD-trading site, announced this week that users can upload their iTunes music to its online library, listen to others’ music, and access and play music from any computer with an Internet connection.
The Palo Alto, CA-based service straddles the area pioneered by P2P services, portable digital music players, and music that is free of copy protection. Lala.com Co-Founder Bill Nguyen said that his company "wanted to create a service that blends the convenience of the web with the portability and functionality of a truly universal platform."
Lala.com’s approach is the third digital music revolution, he added, after Napster and the iPod. With it, users now can share songs "without the threat of PC viruses, spyware, and other risks." At present, there are no subscription fees or ads on Lala.com.
Any digital music can be hosted on Lala.com, the company said, although it is designed for downloading only to iPods. You can listen to all of your hosted library, via streaming, with any connected Mac or PC. You also can listen to the playlists that others have made, either composed of songs in the Lala.com music library or selections from the libraries of other users.
Music can be purchased and downloaded to an iPod or purchased as a CD, but, at present, only songs from Warner Music Group (WMG) are sold on Lala.com.
Lala said in a statement that it has an "agreement in principle" with WMG to make that record company’s music available on the site. News reports indicate that talks are underway with other major music companies as well.
The success of Lala.com "is dependent on the participation of the other three major labels," said Susan Kevorkian, Program Manager of Consumer Markets at industry research firm IDC. "But they’re off to a strong start."
She also noted that Lala, which is "well-funded," still has options for other kinds of revenues, such as subscriptions or ads.
Co-Founder Nguyen has been quoted as saying that he expects the service to lose about $40 million in the first two years, with free-play licensing fees as high as $160 million during that time.
P2P Dominates Chinese Net Traffic
Excerpted from Pacific Epoch Report by Zhenggian Zhou
Traffic from P2P file-transfers accounts for 35-to-60 percent of China’s Internet traffic during the daytime, and 50-percent-to-90-percent of the total traffic during nighttime.
About 70 percent of the Internet users in China are currently using broadband service, with that percentage increasing by one percent every month, according to Chinese Academy of Engineering (CAE) vice president Wu Hequan.
Zhang Xinsheng, Deputy Director of the Science and Technology Division of the Ministry of Information Industry, told attendees at the Broadband World Forum Asia 2007 that China would increase its capacity for P2P technology.
P2P refers to peer-to-peer technology, which allows users to share, search for, and download files. This is the first time that an MII official has made a comment on P2P technology and confirmed that the technology wouldn’t be dropped.
Earlier, it was rumored that this kind of technology would be forced out by telecom operators because of excessive bandwidth use. Chinese telecom operators’ desire to block P2P applications would result in a failure for both the technology and themselves, so they must work to combine resources to make it useful for themselves.
Cisco Launches Linksys One for SMBs
Excerpted from Network World Report by Phil Hochmuth
Cisco Systems this week launched its Linksys One offering, aimed at providing small businesses (SMBs) with packaged routing, switching, voice, wireless, and security gear tied to managed-services.
The Linksys One Services Routers (SVR200 and 3500) are the core customer premise gear. The routers combine broadband or T-1 connectivity with Power over Ethernet (PoE) ports. Software provides firewall, VPN, remote network management/monitoring, device detection for IP phones and other gear, and service provisioning features. Session Initiation Protocol-based VoIP call control also runs on the routers.
For small offices of around 10 people, the SVR200 includes ADSL and Ethernet WAN links and built-in 802.11g wireless LAN connectivity. The SVR3500, for larger offices with as many as100 employees, has dual T-1 connections and a 24-port PoE switch.
Linksys says it has also added features to the software on the Services Router equipment, with capabilities that let customers transfer more calls from IP phones to a cell phone, as well as improved automatic customer provisioning capabilities.
The Services Router ties back to a Service Node for Linksys, which is a product bundle that starts with a Cisco a 7301 router for WAN connectivity, VoIP call control and security services. A server running Linksys One customer provisioning software and hosted applications is part of the package, as well as a Catalyst 4948 Gigabit Ethernet switch. This product trio would sit in a service provider’s network and deliver hosted VoIP, security and other services tied to the Services Router.
North American hosted service providers offering Linksys One products include CommPartners, Hancock Telecom, NeoNova Network Services, Sasktel and Solution One. The SVR200 and SVR 3500 cost $930 and $1,500 respectively. Hosted services tied to the gear are priced differently by carriers.
VeriSign Releases Domain Name Industry Brief
VeriSign, the leading provider of digital infrastructure for the networked world, this week released the VeriSign Domain Name Industry Brief for the first quarter of 2007. The brief, which highlights key industry data for worldwide domain name activity, reports that total domain name registrations reached 128 million, representing a 31 percent increase over the same quarter in the previous year, and a 6 percent increase over the fourth quarter of 2006.
New domain name registrations reached 10.7 million during the first quarter of 2007, a signal that strong growth continues for the domain name industry. Coming off an unusually vigorous new registration rate in the fourth quarter of 2006, the first quarter’s new registrations dropped 8 percent quarter-over-quarter, but showed a strong year-over-year increase of 25 percent.
Country Code Top Level Domain Names (ccTLDs) increased 33 percent year-over-year to 45.7 million, and 5 percent from the previous quarter. Though the approximately 2 million new ccTLD registrations totaled just roughly half of the record-breaking ccTLDs added last quarter, the number reflects an 86 percent increase from ccTLD registrations year-over-year.
VeriSign processed approximately 7 million new registrations for .com and .net domain names in the first quarter of 2007. This represented a 13 percent increase over the fourth quarter 2006 and a 13 percent increase over the first quarter 2006. At the close of the first quarter, VeriSign counted 69 million .com and .net domain name registrations in the base. This represents a 6 percent increase in the first quarter 2007 compared to the fourth quarter 2006, and a 28 percent increase year-over-year.
VeriSign processed an average of 30 billion Domain Name System (DNS) queries per day in the first quarter of 2007, resulting in millions of Internet users accessing websites or sending email. The VeriSign DNS continued to maintain operational accuracy and stability for 100 percent of the time during the first quarter of 2007 as it has for the past nine years.
The VeriSign report also outlines emerging new opportunities for the .tv TLD. According to eMarketer, nearly 60 percent of US Internet users – or 107.7 million people – regularly watched online video content in 2006. By positioning itself as the TLD that reflects more than the address of a website, the .tv TLD can earn global recognition as a destination for compelling rich media.
"The rapid and universal rise of online video is well documented," said Raynor Dahlquist, Vice President at VeriSign. "This latest report notes that the .tv extension translates across cultures and geographies, since ‘TV’ triggers the same association in China as it does in Spain or the United States. Throughout the world, the phrase ‘TV’ means world-class entertainment, which explains why including major broadcast networks, sports leagues, gaming sites, and training organizations have adopted the .tv extension for their business. This trend shows every sign of continued growth."
VeriSign publishes the Domain Name Industry Brief to provide Internet users throughout the world with significant statistical and analytical research and data on the domain name industry and the Internet as a whole. Copies of the 2007 first quarter Domain Name Industry Brief, as well as previous reports, can be obtained at www.verisign.com/domainbrief.
DRM – Go, No Go, or Just Behind the Curtain
Excerpted from Video Insider Report by Scott Brown
In the late ‘90s, the music industry fell victim to rampant P2P file-sharing applications that made copying and sharing music a fairly common practice. One could consider this development but the first shockwave of the digital era – or perhaps it was simply an inevitable next step in a new not-so-obvious and not-so-welcome change in the fundamental business paradigm.
No matter the view, the days of buying the Beatles’ "Rubber Soul" album are long gone. Today we have at least two generations that have used PCs and widely available ripping software to copy and in some cases distribute music entertainment. This continues today, though policing actions have been more effective. Nevertheless, today there are teens and young adults out there who have never purchased a CD or a DVD – and music retailers continue to lament the digital age for lost CD sales and unchecked rights violations.
And so what is the future for video and for television? Video content providers have been zealots with respect to digital rights management (DRM), especially after witnessing the woes of the music industry. But now we reckon with new announcements from Amazon about Unbox, a premium video downloading service – and from Apple, an iTunes Plus DRM-less audio content service at $1.29 per track. The music industry, it seems, may be moving down the DRM-less on-demand pathway. Is this a shift in DRM philosophy or a changing business paradigm with DRM implication for music?
And what of video and containing video downloads? The truth of the matter is that video is subject to many of the same digital toolsets that allow a skilled user to make copies and share, albeit with some generation loss in video quality. The difference is that video’s typically large file sizes means that it’s more work for ripping video applications, and the occasional user probably does not make for an immense problem (yet). Of course major violators will always be castigated when caught ripping major video titles such as first-run movies, etc.
But what of the move by the music industry to remove some of the DRM focus and make it easy for users to do what the music industry once fought – and for an upfront fee? And what is the deal with emerging pay for video download services – and how is DRM containment achieved? Are we witnessing a new video business flavor, or a seismic change?
Paid Content Providers Try Free Trials
Excerpted from eMarketer Report
What makes some paid content services better than others at turning free trial users into subscribers? In an initial step to find out, Marketing Sherpa signed up for free trials with 50 content providers, and interviewed many of their marketers.
The firm found that offering free content immediately can help. eMusic makes such an offer before visitors even reach its home page. The company said it has converted about half of its free members into paid subscribers.
A third of the services surveyed offer trials after users click on content that’s available only to paid subscribers.
Just over half of services that offer a free trial after users click on a premium section put up a complete barrier, not showing any of the content. Instead, members have to sign-in or non-members have to join.
Just over a quarter of services offer a partial view of content above a barrier asking users to sign in or register. Salon.com uses this method.
Free trials can also get around objections based on payment method, as long as registration doesn’t require entering a credit card number.
A Javelin Strategy study commissioned by PaymentOne focused on payment methods, and revealed that security and convenience concerns outnumbered concerns about content. Such concerns make secure registration pages a good idea even for free trial subscriptions.
Free trials can also help establish the value of subscriber-only content for those who might not otherwise get to see it.
As Allen Klepfisz of free-to-consumer P2P music service QTRAX said, "Free is important. In an Internet context, people expect things to be free. News is free, video is free, search is free, so why should music have to be paid for?"
Learn more about how "free" fits into the future of digital music. Read the eMarketer Global Music: Tuning into New Opportunities report.
What’s Next in Ad Targeting
Excerpted from Online Spin By Dave Morgan
The industry has evolved from early fixed banners on web pages, to rotating ads, to registration-targeted ads, to cookie-based targeting, to sequential targeting, to search targeting – and now to behavioral targeting.
With behavioral targeting beginning to emerge as a mainstream solution, it’s natural that many in the industry are beginning to ask, "What’s next? What’s going to be the next wave of online ad targeting?" What do I think is next: predictive targeting.
What’s that? Predictive is one step closer to the Holy Grail of delivering the right ad to the right person at the right time in the right place. It is about truly understanding enough about the consumer’s state of mind at a moment within a particular media or marketing environment to be able to predict what he or she likely needs, wants, or desires – and being able to satisfy or advance that need, want, or desire with a commercial message.
It has two components. First, you need to predict the future. You need to predict what consumers likely need, want, or desire. Second, you need to have a way to change that future, even if it is only to reinforce and ensure that what is likely to happen actually does happen. You need to understand what type of commercial message can make the desired future most likely to occur. How do you do that?
First, you have to know something about a lot of different consumers and their actions within digital media and marketing environments. You need to understand the wisdom of the crowds. The premise is that "birds of a feather flock together" – that knowing how lots of different consumers have acted, interacted, responded, and purchased in the past will help you predict what people like them are likely to do in the future.
Second, for consumers that you want to target, you have to know a certain amount about their actual actions within media and marketing environments. You need some way to connect them to the crowds if you want to predict what they are likely to do, so you have to know something about what they have done in the past.
And third, you need to have an understanding of what types of commercial messaging are likely to create the desired results with the various types of consumers in a variety of states-of-mind and in various media and marketing environments.
None of this is trivial. Developing this kind of capability will require extraordinary scale and skills in data, marketing analytics, consumer behavior, and, most important, creativity.
This will be the next generation of our industry, but it will take many years to develop. It will require much more maturity in the marketplace. While it may take a while, its development is very exciting. Even today, we already see early versions of predictive targeting in the e-commerce world – Amazon’s recommendations are a great example – and also in some implementations of more sophisticated behavioral targeting programs.
What could slow this down? Certainly issues like privacy and over-hype could hurt, but ultimately, if predictive targeting of online advertising can improve consumers’ experiences and give them ads that they want and need, it will happen, and sooner rather than later.
Copyright Silliness on Campus
Excerpted from Washington Post OpEd by Fred von Lohmann
What do Columbia, Vanderbilt, Duke, Howard, and UCLA have in common? Apparently, leaders in Congress think that they aren’t expelling enough students for swapping unlicensed music and movies.
The House committees responsible for copyright and education wrote a joint letter May 1st scolding the presidents of 19 major American universities, demanding that each school respond to a six-page questionnaire detailing steps it has taken to curtail unauthorized music and movie file sharing on campus. One of the questions – "Does your institution expel violating students?" – shows just how out-of-control the futile battle against campus downloading has become.
As universities are pressured to punish students and install expensive "filtering" technologies to monitor their computer networks, the entertainment industry has ramped up its student shakedown campaign. The Recording Industry Association of America (RIAA) has targeted more than 1,600 individual students in the past four months, demanding that each pay $3,000 for file-sharing transgressions or face a federal lawsuit.
In total, the music and movie industries have brought more than 20,000 federal lawsuits against individual Americans in the past three years.
History is sure to judge harshly everyone responsible for this absurd state of affairs. Our universities have far better things to spend money on than bullying students. Artists deserve to be fairly compensated, but are we really prepared to sue and expel every college student who has made an unauthorized copy? No one who takes privacy and civil liberties seriously can believe that the installation of surveillance technologies on university computer networks is a sensible solution.
It’s not an effective solution, either. Short of appointing a copyright hall monitor for every dorm room, there is no way digital copying will be meaningfully reduced. Technical efforts to block file sharing will be met with clever countermeasures from sharp computer science majors. Even if students were completely cut off from the Internet, they would continue to copy CDs, swap hard drives, and pool their laptops.
Already, a hard drive capable of storing more than 80,000 songs can be had for $100. Blank DVDs, each capable of holding more than a first-generation iPod, now sell for a quarter apiece. Students are going to copy what they want, when they want, from whom they want.
So universities can’t stop file sharing. But they can still help artists get paid for it. How? By putting some cash on the bar.
Universities already pay blanket fees so that student a cappella groups can perform on campus, and they also pay for cable TV subscriptions and site licenses for software. By the same token, they could collect a reasonable amount from their students for "all you can eat" downloading.
The recording industry is already willing to offer unlimited downloads with subscription plans for $10 to $15 per month through services such as Napster and Rhapsody. But these services have been a failure on campuses, for a number of reasons, including these: they don’t work with the iPod, they cause downloaded music to "expire" after students leave the school, and they don’t include all the music students want.
The only solution is a blanket license that permits students to get unrestricted music and movies from sources of their choosing.
At its heart, this is a fight about money, not about morality. We should have the universities collect the cash, pay it to the entertainment industry and let the students do what they are going to do anyway. In exchange, the entertainment industry should call off the lawyers and lobbyists, leaving our nation’s universities to focus on the real challenges facing America’s next generation of leaders.
Coming Events of Interest
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P2P MEDIA SUMMIT LA – June 11th in Santa Monica, CA. 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. Held in conjunction with the new Digital Hollywood Spring conference and exposition.
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Digital Hollywood Spring – June 12th–14th in Santa Monica, CA. Now expanded to Le Merigot as well as Loews Anatole Hotel. With many new sessions and feature events, this has become the premiere digital entertainment conference and expositions. DCIA Members will exhibit and speak on a number of panels.
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NXTcomm – June 18th–20th in Chicago, IL. The next-generation global forum and marketplace for the business of information, communications, and entertainment technology. The forces that drive communication and the solutions to harness it converge here. The DCIA will participate with Digital Hollywood.
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NY P2P 2.0 June Meet-Up – June 20th in New York, NY. Pando Networks’ CTO Laird Popkin will present a "Brief History of P2P Networks." INTENT MediaWorks’ Andy Cooper and CacheLogic’s Marco Parente will also speak. RSVP now so you don’t miss out on the very latest in the rapidly growing P2P industry.
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Web Video Summit – June 27th–28th in San Jose, CA. This workshop is about video distributed over the Internet, bringing together the pioneers of an exploding industry. They’ll explain what you need to know about shooting, editing and encoding, distributing and promoting your work, and claiming your rewards. Real choices, working techniques, and field-hardened creators.
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Edinburgh Television Festival – August 24th-26th in Edinburgh, Scotland. Janus Friis, Co-Founder of P2PTV service Joost, will deliver the inaugural Futureview Lecture at this year’s festival. The aim of this year’s event is to assemble a cast list from the hottest shows, the most exciting new technologies, and the biggest TV controversies of the year.
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International Broadcasting Convention (IBC) – September 6th-11th in Amsterdam, Holland. IBC is committed to providing the world’s best event for everyone involved in the creation, management, and delivery of content for the entertainment industry, including DCIA Members. Run by the industry for the industry, convention organizers are drawn from participating companies.
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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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