Is Streaming Ready for Prime Time?
It’s the dawning of the streaming content era. But how quickly this star rises will depend largely on how quickly and closely the technology can approach TV quality, and on the continued growth of the broadband user base.
College-aged computer aficionados go from rags to riches and revolutionize the IT world. It’s familiar fare. Bill Gates, Paul Allen and Steve Jobs did it in the 1980s. Two Stanford Ph.D. students, Sergey Brin and Larry Page, did it in the 1990s with Google. And now, Chad Hurley and Steve Chen have done it with their video-sharing site, YouTube.
Google’s $1.65 billion acquisition of YouTube in October of 2006 brought Hurley and Chen's Cinderella story to the front pages. But something far more important made it into the mainstream consciousness along with it: streaming content. Look no further than the price Google was willing to pay for YouTube compared to its other recent acquisitions — Google paid a total of $130.5 million for 15 small companies in 2005 — to see the importance of streaming content in the Web 2.0 world. Indeed, Google CEO Eric Schmidt considers it "the next step in the evolution of the Internet." 1Google Buys YouTube for $1.65 Billion." Associated Press on MSNBC.com, October 10, 2006.
For streaming content to be the "next step" will still require some serious evolution. The user-generated content watched on YouTube today, for example, is largely low-quality. Yet over 19 million people are visiting the site each month. 2Ibid. Performance issues like extended buffering times and interrupted streams have also plagued the streaming user experience, yet corporations, governmental agencies and educational institutions are stepping up efforts — albeit for the most part cautiously — to utilize streaming both internally and externally. 3Curtis Franklin, Jr., "The New Streaming Media Economy," Keynote Paper, p. 2. While the mainstream is showing its willingness to take the next step in the evolution of the Internet, the question remains: Is streaming ready for the mainstream?
When predictions for streaming media were first made, everyone assumed that a revolution would take place in entertainment, news, advertising, and communication. What happened was that streaming customers were often disappointed.
THE CURRENT STATE OF STREAMING TECHNOLOGY AND CONTENT
Despite the buzz and the impressive monies being invested, streaming technology and content today is in a nascent stage. Providers are addressing performance issues and offering solutions to improve the quality of the user experience. Users themselves are increasingly finding ways to use streaming in their daily lives — but streaming is not nearly ready to challenge the traditional idea of “prime time.” It is clear, though, that the time is not far off when people will stream news and sporting events any time during the day (no doubt to the dismay of their employers) and not just to their desktops, but via mobile devices and TV, too. But not quite yet.
There is a great deal more of higher-quality content than user-generated clips available online, including streams from all the major media outlets, both broadcast and print. And while millions of users are busy emailing fuzzy, poorly shot YouTube videos to each other, the user expectations for media and corporate sites are escalating quickly.
"It is growing at such a fast pace," says Jeff Geiser, global director, streaming media and VoIP at Keynote, "the expectations from a consumer's perspective are certainly rising. When you begin to watch, say, Lost over the Internet, your expectations for the quality of the experience may be a bit lower than with TV, but they are now starting to approach the levels of quality expected from TV."
This is creating demand for better content and an overall rethinking of how content can be created and leveraged. Major companies such as General Motors, Nike, Levi Strauss and virtually all of the major broadcasters are embracing streaming video to diversify their advertising and expand their services on the Internet. Currently, video commercials comprise less than 5 percent of online ad spending, but that spending is doubling every year. In 2005, video ad revenue was a mere $225 million; in 2006, it nearly doubled to $420 million. Estimates for 2007 are upwards of $700 million. While many online advertisers have been slow to move beyond standard text banner ads, streaming video promises to change all of that. But to be effective — to reflect the environment and expectations of online users — streaming ads need to be more than a simple porting of TV commercials into an online format. 4Louise Story, "Forgive Me, Viewer, for I have Confessed in a Banner Ad," The New York Times, February 10, 2007.
"Brands are trying to adopt user-generated content to get in touch with their customers," says Thierry Curis, product manager for streaming services at Akamai, a leading global service provider for accelerating content and business processes online. Curis points to GM's innovative user-generated Super Bowl ad and Nike's commercial featuring user-submitted clips of a soccer ball being passed from person to person. These campaigns all leverage a relationship between streaming video and TV. But one steady and fast rule has become apparent: TV ads and Internet ads are not on the same footing.
The obvious strategy is for companies to get on the forward edge, play by the Internet's rules and stream fresh video unique to the Internet. For advertisers, this means seeking out effective means to get their messages across in a "Web-centric" fashion. For content providers including traditional broadcasters, it means rethinking the old repurposed content that many are currently streaming. Keynote’s Jeff Geiser points to CNBC.com as a leader in Internet-purposed content. "They're streaming independently produced material specifically for the Web," he points out, "so you can see Maria Bartiromo give a market update in a studio dedicated to that particular Web sequence, and it's different than what you see on TV."
Such strides are raising the bar on today's content, helping push expectations toward TV-quality streams over the Internet. But despite all the excitement over streaming’s content evolution, current streaming capabilities are limited by provider and user infrastructure, and overall broadband penetration.
"The balance between technology and content dictates the capability of companies to reach consumers," says Geiser. "Content providers are talking to us about delivering content that's super high quality, but not so big that someone would not be able to view it. So the trend is towards better delivery and higher-produced content, and growth in broadband is the linchpin of that success."
When predictions for streaming media were first made in the 1990s, everyone assumed that, within a few years, a revolution would take place in entertainment, news, advertising, and communication. What happened was that streaming customers were often disappointed. According to Curtis Franklin Jr.'s paper, "The New Streaming Media Economy," access to broadband appeared much more slowly than advertised and "dial-up access could simply not support the promised streaming media programming." 5Franklin, p. 3.
Former chairman of the Federal Communications Commission William E. Kennard calls this gap between dial-up and broadband the new digital divide, implying that those with narrowband connections are being left behind. 6William E. Kennard, "The Broadband Revolution," The New York Times, October 21, 2006. That divide is closing at an ever-faster rate, according to Pew Internet Research. But while the pace of broadband adoption for the year ending March 2006 was twice the rate of the previous year, still only 42 percent of American adults have broadband at home. 7John B. Horrigan, Pew Internet & American Life Project, "Home Broadband Adoption 2006," May 28, 2006. While providers are anxiously waiting for the critical tipping point of broadband penetration, they are focusing on other infrastructural limitations that "crash against the user's demand for smooth video, clear audio, and performance," all of which are as integral as broadband to a quality user experience. 8Franklin, pp. 2, 3.
"Making sure you can handle the kind of load that live streaming requires is very complicated to deliver," says Keynote's Geiser. "There are many companies that can help content providers produce and deliver live streaming events, but because there are so many different companies involved in the delivery, it tends to be very complicated."
The complications arise from the nature of the operational groups delivering the stream, with multiple points in the infrastructure and delivery chain, multiple bit rates and multiple formats. Certain content may bypass some of the technology providers while going through others. The worst that can happen in the midst of such a complex delivery platform is for streams to become completely unavailable when the user summons it.
Without a robust and thoroughly tested delivery infrastructure, the best-laid streaming plans can quickly go awry, as New Line Cinema learned earlier this year. As reported in The New York Times, New Line sponsored a live banner ad campaign to promote funnyman Jim Carrey's not-so funny horror movie, "The Number 23." DoubleClick, the firm overseeing the campaign, went out to over 80 nightspots across the country to film random participants as they confessed their obsessions — their own personal versions of Carrey's obsession with the number 23. On the night of the premiere, DoubleClick planned a stream of these confessions, as well as live feed from a bar in Georgetown in Washington D.C. Anyone who clicked on banner ads of the movie throughout the Web was redirected to a YouTube channel housing the clips and the live stream. Unfortunately, the streaming process was derailed with 45-minute delays. 9Louise Story, "Forgive Me, Viewer, for I have Confessed in a Banner Ad," The New York Times, February 10, 2007.
"We were bit late off the game," admitted Chris Young of DoubleClick to The New York Times. "Obviously, as we start doing this more and more it will be much more regulated. 10Ibid.
The New York Times reporter who broke the story called this streaming event "experimental marketing," 11Ibid. and in DoubleClick's case, she was right. But there are solutions available right now that minimize the risk for such streaming snafus.
TOOLS AND TECHNIQUES FOR MONITORING AND ENSURING STREAMING QUALITY
Put bluntly, streaming media is a bandwidth hog that can strain servers and networks. Live streaming, in particular, can place intense loads on the infrastructure. Maintaining the infrastructure to reliably satisfy streaming demand — even for the sporadic spikes of on-demand streaming — requires a bigger investment than most organizations are prepared to make. Many have turned to Content Distribution Networks (CDNs) to handle their streaming, which distribute caching content servers between the central streaming media servers and receiving clients, thereby relieving stress between the originating server and client. Akamai maintains one of the world's foremost distribution networks, with 20,000 servers deployed in 71 countries around the globe (as of February 2007).
"The fact that we deliver content ourselves in a distributed fashion increases the quality of the performance," says Thierry Curis of Akamai. "Whether it's for streaming or other Web site performance, people realize more and more that you cannot be slow; you cannot be worse than your competition in terms of quality of streaming."
Using CDNs has proven an effective tool to improve streaming quality, but still, you can't manage what you don't measure. Monitoring the impact that streaming is having on the network helps providers know what sort of experience the user is having on the other end of the stream and enables them to manage it. Keynote Systems' Streaming Perspective testing platform is useful for providers to determine how well CDNs are moving their programming to customers, and by the CDNs themselves to support delivery performance claims. Both customers and providers who have signed Service Level Agreements have found such measurements integral to guaranteeing that specific levels of performance are met. 12Franklin. pp. 4-5.
Using agents placed around the globe to measure audio and video streams, Streaming Perspective monitors a variety of factors including connecting time, download time, and re-buffering. The agents attempt to connect to streams ten times per hour, and once connected, play the content for 60 seconds while collecting network, streaming, server and presentation statistics. The results are consolidated into a user "frustration factor."
"When a customer is delivering content," says Keynote’s Geiser, "and they go into a period of very high demand, their ability to deliver begins to fluctuate. Their infrastructure can be up and delivering video and it may look like their environment is running well, but we can tell them that, in fact, from Miami and Dallas and L.A., the user experience has all of a sudden gotten very, very bad."
Certainly, to ensure the quality of a streaming event, it is critical to thoroughly test before the event is scheduled. FoxSports.com regularly tests its sites before predictable traffic spikes during the Super Bowl and other major events. Fox also tests its network thoroughly before launching major events or promotions of its own, such as its recent "Virtual Coach" promotion, and tries to anticipate under-the-radar sporting events that might bring unexpected spikes in streaming demand. Akamai, too, uses Keynote’s measuring services to demonstrate the benefits and quality of its network to customers.
These solutions are not yet ubiquitous, making that balance between technology and content seem more immature than it is. However, one thing is sure — as streaming technology and content continue to develop, and broadband continues to proliferate, high-quality streaming audio and video will continue to accelerate the growth of the Internet as a prime time entertainment medium.
NO SCREEN UN-STREAMED
Clearly, streaming is a complex and challenging technological problem — all the more so when you factor in a two-inch screen, multiple client devices each with their own standards, and multiple carrier networks with their own diversity of standards. This is the challenge of steaming to mobile devices. Despite these hurdles, streaming to handheld devices is a serious focus of the major media companies.
MobiTV is a leading provider of streaming content to handhelds, both under its own label and behind-the-scenes for cellular carriers. The MobiTV line-up looks a lot like the channel listings on the cable and satellite networks, from CNN and other network news to ESPN and Discovery. MobiTV also offers its own mix of video music and radio channels. In the U.S., MobiTV streams content for Sprint, Cingular, Alltel, and other carriers, and provides PC streaming for AT&T Broadband TV.
Kay Johansson, chief technology officer for MobiTV, predicts that mobile TV subscription numbers will be "extremely higher" in the next 12 to 18 months. One of the reasons, he says — though certainly one among many — is the 2008 Summer Olympics in Beijing.
"The Olympics in 2008 are going to be a really strong driving force behind mobile TV and also HDTV," Johansson says. "The Olympics are a driver for new technology. We're seeing lots of HDTV investment ramping up today because of the Olympics."
With streaming handheld content and even the ability to control your home TV system from your cell phone, MobiTV is at the forefront of the movement to make content truly portable.
"We're starting to see the convergence, the lines blurring between traditional cable TV, Internet TV, and mobile TV," Johansson explains. "This is a hard challenge, but from the MobiTV perspective, also an opportunity."
As with any streaming technology, maintaining the quality of the service is an ongoing challenge. MobiTV’s engineering staff creates the clients to handle the streams for the various handhelds and carriers. To monitor and ensure the quality of the stream reaching the end-user for their PCTV product, they depend on Keynote Systems.
Streaming to handhelds is a technology that will definitely have its place with an on-the-go audience. But will the world be watching the Olympic gold medal soccer final on cell phones? Stay tuned.
Between the current state of streaming and the arrival of “any time is prime time,” companies must first find ways to change attitudes. Laptops are not just computers, cell phones are not just phones, and TVs are not just for traditional programming.
STREAMING INTO THE FUTURE
The hottest topic in streaming media is where we go from here," says Geiser. "And that depends on how traditional media companies react. They already see a value in distributing their content via nontraditional means over the Internet, and to a number of devices beyond TV. But how they leverage that value for marketing, tie it in to their traditional programming, and gain ad revenue is the hot topic."
Between the current state of streaming and the arrival of "any time is prime time," companies must first find ways to change attitudes. Laptops are not just computers, cell phones are not just phones, and TVs are not just for traditional programming. Today, cross-platform marketing campaigns try to drive users from one medium to the other. The next step, according to an ABI Research report, is connecting those at-home networks to mobile devices. 13Nicholas Carlson, "Streaming Video to Reach $27b," Internetnews.com, April 24, 2006.
That requires making mobile devices stream-friendly. "You’re not going to deliver content at the same bit rates that you do to laptops or broadband-connected devices, says Geiser. "Automatically dropping the bit rate and formatting it for mobile phones is pretty critical." 14Interview with Geiser.
Such a step could see streaming video and music generate $27 billion in revenue by 2011, an Insight Research report says. 15Carlson. But quite a few factors must first be addressed before the marketplace will see that kind of revenue. What devices will prevail in this race to get video from the Internet to the TV? Who will end up in control of the content? Will consumers bypass traditional cable and telephone networks to get access? Or will the cable and telephone networks figure out a way to play nicely?
With a reported 40 percent of U.S.–cable subscribers unhappy with their service, demand may make the decision to house content or farm it out a matter of expediency. “That could translate to a windfall for Internet companies and service providers eager to serve up video for a fee or sell advertisements posted alongside that programming,” says Olga Kharif in BusinessWeek.com. 16Olga Kharif, "High Tech TV," BusinessWeek.com, May 30, 2006.
But the more providers ask consumers to pay for content – either directly or through the intrusion of advertising – the more the experience has to approach TV quality, which brings us to back to the question: Is streaming ready for prime time?
Streaming is already fairly commonplace for live events such as sporting events, concerts and the like. As technology improves, so will high-quality content and the ability to merge the worlds of TV, Internet and mobile devices. Thierry Curis of Akamai sees the big guys of the world already embracing the Internet as a valid channel to deliver content. “It’s not just satellite anymore. It’s not just over-the-air type of delivery. The Internet has become an integral part of the broadcasting model today, and we’re going to have a lot more content that used to be delivered over the TV that will be available on the Internet.”
And then, many businesses hope, the revenues will be streaming, too.