When it comes to delivering online video, content owners continue to need more services than just pushing bits across a network. The real struggle moving forward is trying to solve the entire ecosystem of video creation, ingestion, transcoding, management, storage, distribution and tracking. Not to mention all of the other sub-categories of management like authentication, meta data, business rules, etc.

The question I often get asked is who’s in the transcoding market and what segments of the market are they going after? In a recent conversation I had with Ripcode, they shared with me one of their slides that breaks out the different vendors in the market and the segments or verticals each vendor is going after. While I am sure there are a few more vendors that could be listed, especially for mobile transcoding, the slide does a good job of capturing who’s in the market today and what they are focusing on.

While transcoding is a small market today, it’s only going to grow larger as more content owners place more videos online, in more formats, for more devices. Over time, transcoding is going to become a mainstay functionality of the CDNs and we are already beginning to see more content delivery networks think about the ecosystem for video, including transcoding. In addition, some content owners have the ability and resources to do their own transcoding and for some, it makes sense to keep it in-house. The transcoding solutions on the market today are a lot cheaper and more efficient than they were three or four years ago and provide the ability to turn around videos very quickly for content owners who have the internal manpower.

Last year, Frost & Sullivan released a report entitled "Video Encoders and Transcoder Market" which contains a slide that shows the revenue forecasts and growth rate for 2005-2014.

The Frost & Sullivan report details that over the next few years, while the size of the transcoding and video encoder market continues to grow, it will so do at a slower rate, due to competition driving prices down and product saturation down the
road. They still have the market growing but at decreasing rates as
digitization becomes well established globally over the forecast period.

While transcoding is not a service you hear many people talking about in the industry, it is a topic that you hear raised quite often when speaking to a large number of customers. Over time, transcoding should become a technology that is built into the network layer of content delivery and hopefully will be seen less as a stand-alone product offering. The key thing to remember is that if content owners can’t get their video into the right format, for the right device, they content can’t be delivered.

The week of the Sept. 22nd, during the Streaming Media West show in San Jose, numerous networking events and parties are taking place for those interested in meeting with others from the online video industry.

Monday Sept. 22nd
Informal Speakers Meetup
Location: Acadia bar in the Marriott Hotel
Time: 7:00pm-9:00pm
No RSVP needed, all welcome

Tuesday Sept. 23rd
Streaming Media West Opening Reception
Location: Convention Center Exhibit Hall
Time: 5:00pm-7:00pm
No RSVP needed, just register for a free exhibit pass to get in

Online Video Producers Meetup (organized by Tilzy.tv and TubeMogul)
Location: Convention center lobby area outside the Streaming Media West exhibit hall
Time: 7:00pm-9:00pm
RSVP at: http://www.tilzy.tv/producers-meetup

Abobe Cocktail Reception
Location: Adobe Headquarters, 345 Park Avenue, San Jose
Time: 7:15pm-9:00pm
RSVP Required, Space is limited: http://www.eventsadobe.com/smw2008/user_info.php

Wednesday Sept. 24th
Streaming Media Magazine Readers Choice Awards
Location: Grande Ballroom, Sainte Claire Hotel (next to the convention center)
Time: 7:30pm-9:30pm
Awards presentation starts at 8pm

In addition to these events, other vendors are having their own private networking functions. If there is one you really want to go to, let me know and I’ll see if I can get you in.

Yesterday, the Wall Street Journal published a blog post entitled "Moving Bits through Private Pipes" that talks about content delivery networks and describes how video is delivered. The problem is that like many writers covering the topic, they only get their info from vendors and assume what the vendors are telling them is true. Or they use phrases and words in the post without really knowing how they tie into the technology and don’t challenge any of the quotes they get from analysts.

The author says that, "Multimedia communication — particularly video — has caused a strain on public networks, degrading the quality, so privatized networks have become more attractive over the last few years." Where’s proof that the public networks are under any "strain"? And what CDNs have "privatized" networks? CDNs do not have "private" networks. They have private cross-connects and things like private peering, but the networks themselves are not "private". They are all delivering content over the Internet, which is public. Yes, some CDNs own the pipes, but the content to the end user is not being delivered from a "private" network.

Berge Avayzian, an analyst with the Yankee Group is quoted in the article as saying, "Video is a huge game changer but its big and bulky, so sending video files over traditional Internet pipes is flawed." What are "traditional internet pipes"? Are there any internet pipes that are un-traditional? And what does Berge classify as being the flaw? The CDN space for video this year alone is north of $400 million, so the "flaw" does not seem to be stopping the market from growing or vendors from growing revenue.

The author of the blog goes on to quote Tata over the recently announced relationship with BitGravity but the statements don’t make any sense. Tata is quoted as saying that "BitGravity’s network is designed specifically to handle video," as if they are the only one. Limelight’s network was specifically built to handle video from the very first day they launched, years before BitGravity. Tata is also quoted as saying, "The internet as we know is changing, it’s much more of multi-media, communications medium now. Outdated hardware and infrastructure can’t handle that." Who has outdated hardware and infrastructure?

BitGravity and others need to stop coming to the market and saying their content delivery networks are "next-generation" and as a result, Akamai, Limelight and everyone else must be using old, outdated hardware and have a legacy network. What do you think guys like Akamai and Limelight are spending all these CAPEX dollars on? They are not running outdated hardware and their size of their CDN revenue shows that their networks are not outdated. And what about someone like Level 3 who has built out their network in the past 18 months? Does that mean that are using all outdated gear also?

The idea that just because a CDN has been around for more than a few years they are somehow falling behind in being able to deliver content is not accurate. I’d say the opposite. They have more real-world experience building out their network to deliver video and have an advantage over any new CDN who simply does not have the hands-on experience, the volume of traffic or the number of customers that a well-established CDN has.

BitGravity, it’s not in your best interest, or the industry’s for that matter, to keep trying to portray every other CDN as outdated. If you want the industry to seriously consider your network to be some sort of "next-generation", then put on your website a white paper explaining how it is technically different, with technical details. Because without details, all you are giving us is marketing speak. Looking at the technical page on BitGravity’s website gives us no description whatsoever of the technology.

For Bobby White who wrote the article on the WSJ, I feel for him. If CDN is not a topic he tracks and covers on a regular basis, it is very hard for him or any other author to get the straight details, minus marketing speak from many of those in the CDN market. I don’t fault someone like Bobby for quality of the blog post he wrote, I fault vendors and analysts in the market who don’t take the time to truly explain the business, the technology or the terms in our industry to a writer who is trying to cover our market.

This morning Microsoft made the move that many content creators had been hoping they would do for some time. Microsoft announced that H.264 and AAC support will be available in a future version of Silverlight. While H.264 support won’t come till sometime next year, later in the week at IBC, Microsoft will demonstrate a technical preview of H.264 and Silverlight in action.

In my conversation with Microsoft yesterday and in the Q&A that Microsoft released this morning with Scott Guthrie, corporate VP of the Developer Division at Microsoft, additional details have come to light. When asked if this means that Silverlight is moving away from Windows Media Scott says, "Not at all. This is about offering our customers more choice." That hits the nail on the head. Give customers what they want. Customers have been asking Microsoft to adopt H.264 and give them more options.

The Q&A also covers some details regarding Microsoft’s recent investment in Move Networks and announces a bunch of new major broadcasters in Europe who will be using Silverlight. Microsoft also says that Silverlight 2 is scheduled for final release this fall and takes a jab at Adobe over viewing data for the Olympics content saying, "On the Silverlight-enhanced NBC Olympics site, the average viewing time was over 27 minutes, as opposed to an average of just three minutes on some Flash-powered sites broadcasting Olympics coverage elsewhere. We think this indicates Silverlight provides a more compelling, engaging and rich media experience for viewers." I don’t know where the three-minute data comes from, but clearly Microsoft is saying that better quality equals a longer viewing experience.

One the H.264 front, while the announcement will be a surprise to many, it should be noted that Microsoft has been an active participant in the standardization of H.264/MPEG AVC for many years. Microsoft’s Gary Sullivan was the chairman of the Joint Video Team (JVT), which developed the H.264 standard, and he recently accepted an Emmy Award on behalf of the JVT.

For many of us in the industry, we knew it was only a matter of time before Microsoft adopted H.264, the sooner, the better. Now, it’s going to get really interesting. If the industry can rally around making H.264 a standard, even if it is just for video on-demand to start, this would benefit all content owners in the long run. More details about H.264 and Silverlight will be talked about in two weeks at the Streaming Media West show and Microsoft will be in attendance on the exhibit floor. Sign up now and get a free pass to get in hear more about this from Microsoft.

It’s a shame that in our industry, some bloggers are more concerned with writing a headline just for drama sake, as opposed to actually getting the details right. In the past few days, at least half a dozen sites said that NBC was "dropping", "dumping" or "ditching" Silverlight in favor or Flash for streaming of football games on NBCSports and NFL.com. Some also had headlines like "NBC has enough of Silverlight".

Problem is, none of this is true. Did any of these journalists actually speak to anyone at NBC or the NFL? If any of them made a simple inquiry to NBC or the NFL they would have gotten the same response I got which was, "NBC did not drop Silverlight and this was an entirely separate event and partnership. The NFL selected Adobe." And in order to "drop", "dump", or "ditch" something it means you have to be using it first. Since the NFL games had never been broadcast before, how were they using Silverlight in the past? The Olympics has nothing to do with the NFL. And it looks even worse for those who wrote these posts trying to make Silverlight sound bad, but then in the same post said that the NFL video experience with Flash was not very good.

I’m sure some will say who cares, the bottom line is that the NFL selected Flash. Ok, then make the story about that, don’t try to make it out to be something it isn’t.

I’ve expressed interest in the past about launching a new conference focusing on the content delivery market as it pertains to video. The conference would talk to all of the workflow pieces in the CDN ecosystem and the focus of the show would be on producing really strong conference sessions, with a limited exhibition component. I would be planning a conference agenda that would be of interest to those on Wall Street, those who buy CDN services and those vendors that are in the CDN market today.

After doing some initial planning, it looks like we may launch this new show, in NYC, in 4-5 months time. Initial estimates are that it would be a two-day show and include two tracks over both days and have about 20 sessions along with keynotes and some breakout presentations.

While we are still working on the details, the reason I am posting some details now is that I need feedback. I want to hear from everyone, vendors included about what you would want to see at the show, how you want to be involved, if you want to speak, what topics you think need to be covered and more importantly – what you think the format should be. I am gladly taking any and all feedback.

In the next few weeks, I should have an update on where this potential new show stands. We already have space reserved in one of the local hotels in NYC (not the Hilton) and will be looking to keep the event to a smaller, summit like experience with a lot of good networking.

If you want to sponsor, speak, attend or be involved in anyway, please let me know. I appreciate all feedback.

This morning, Tata Communications announced the launch of their new global CDN service using BitGravity’s technology. In addition, Tata announced it had made a $11.5 million investment in BitGravity, bringing BitGravity’s total money raised to date to just over $14 million. BitGravity says it will use the money to increase their sales and marketing efforts and that none of the money invested by Tata is needed to support their licensing of BitGravity’s technology.

With the size and reach of Tata’s IP network, over 200 countries and across 300 POPs, adding a CDN offering for their enterprise customers is a no brainer. Initially, their new CDN offering will deliver content from about 20 locations in the U.S., Asia and Europe. While some classified this as a reseller arrangement when Tata and BitGravity announced the initial partnership in March, Tata is not reselling BitGravity and has spent the past six months building out CDN capabilities on their own network. That being said, to be a true CDN player in the market, you have to do more than just deliver bits and I’m interested to see what product feature set Tata’s CDN offering will have.

While it is too early to know how successful Tata’s new CDN offering can be, it fits nicely into their core business. Tata won’t be the last IP carrier to enter the market and I know of some additional carriers who want to launch CDN offerings in the next few quarters.