Another year has past and Online Video has certainly grown out of its infancy well into toddlerhood having kicked the training wheels yet still a bit wobbly on its feet with many years ahead to grow and learn. My first predictions piece went out last year at this time just a month after officially launching VidCompare to the public. We too have grown considerably over the months now boasting a roust directory of 85 online video platforms of various flavors and specialties.
The goal of VidCompare at launch was to two-fold, to help the platforms market their business and generate qualified leads and to help publishers and businesses wade through hoards of options to find the right OVP for their specific needs. I think we’ve succeeded in helping many businesses do just that, and we’ve certainly sent our share of new customers to the OVPs. We’ve helped some very large brands find video solutions as well as small businesses just getting off the ground with exciting new video-based properties.
This year I’m taking a different approach to my annual predictions. Last year I offered up some opinion and aggregated some thoughts from across the web from people in the space who I felt were making some noise. This year I will again offer up my insights but this time I’ve personally asked several thought leaders to contribute to the piece by sending me three thoughts on what they see coming in the new year for online video.
Based on what I’ve learned from running VidCompare over the past year I think we’re going to finally see the OVP space thin as M&A activity ramps up and those with lesser business models begin to wither away. We saw some of this in 2009 with Google gobbling up Episodic, Kit Digital acquiring Multicast, and LimeLight Networks acquiring Delve. And along those lines, if OVPs want to survive and avoid commoditization providers will have to specialize as several OVPs already are, like Kaltura owning the ‘open’ space, Ooyala firing on analytics and monetization, Unicorn and Twistage owning workflow management, and DigitalSmiths dominating metadata management (who recently acquired fellow metadata-centric OVP, Gotuit). We will also see multi-device delivery and adaptive bit rate become table stakes as opposed to a competitive advantages. Social outlets will continue to drive mass amounts of video delivery and adoption. And my biggest prediction for 2011 is that more high-quality content will become available and easier to access allowing for further monetization via advertising with more inventory streaming about.
And without further ado, here are the 2011 predictions from thought leaders in Online Video. Pay close attention, you will definitely see some themes emerge below as these OVP leaders speak.
Jeff Whatcott – SVP Marketing, Brightcove
1. Device platform fragmentation puts the heat on DIY initiatives and makes OVPs all the more attractive.
2. Dramatic increase in social viewership drives innovation in social sharing techniques and measurement.
3. Continued consolidation as players that are failing to achieve profitable scale are forced to exit the stage.
Steve Rosenbaum – CEO, Magnify.net
1. 2011 is the year we Connect. No longer will web video be trapped on desktops or laptops. CES in January will be the starting bell in a massive race to the flatscreen. Google TV will make the most noise, and consumers will find that more and more devices will come with GTV chips from intel already on board. But don’t think that means Google wins – there are nimble and passionate competitors who are going to break out in 2011. Roku and Boxee will battle it out as the kind of the insurgent devices. Apple TV will remain a hobby. And Netflix and Hulu will find that more and more content companies break out their own ‘over-top’ software offerings. Cable’s decline will accelerate as consumers find that they can get everything they want, and more from broadband.
2. 2011 is the year that Content = Commerce. Back in televisions early days – advertisers were content creators. Remember when ‘soap operas’ where produced by soap companies? Well, now that era is back – and it’s going to be explosive. With content creation tools now easy to use – brands and ecommerce companies will find that they’re going to begin to tell their story in video, and in long form. BestBuy will produce content (and gather it) about consumer electronics, Whole Foods will teach cooking, Pepsi will empower their users to tell stories about the Pepsi Refresh campaign. And – given the newly connected world of social media – consumers will Like the newly conversation brands that they interact with.
3. 2011 is the year we Curate. The result of this massive explosion of content creation is that we are increasingly overwhelmed with choice. Too much content makes finding useful and relevant material increasingly difficult. In a world of unlimited choice, search fails. What we’ll see is a growing category of content curators – individuals, brands, and publishers, who choose to be the finders and filters of what matters within their particular niche area of focus. This will force content creators to take a long look in the mirror, and realize that they simply can’t make enough content to be relevant, timely, and valuable. But, creation and curation shouldn’t be in conflict, and they won’t be going forward. Creators will curate – publications will both commission editorial and find and link to the best of the best. Curated video channels will make their way to your connected flat screen. Advertising will follow.
Oh, and one more thing. 2011 will be the year that business models emerge for content – both creation and curation .
Ron Yekutiel – CEO, Kaltura:
1. The coming year will continue to show unprecedented demand for open-source solutions, driven by users’ needs for flexibility, interoperability, ease-of-integration, and control.
2. The video delivery space will become further commoditized, shifting focus to an application layer that shall command customized functionalities and work-flows that are tightly integrated with other content management systems. This trend will be fueled by growing demand from non-media verticals such as enterprise, education, healthcare, and government, where custom work-flows and tight integration are paramount.
3. We shall also see most cloud vendors and service providers entering the market to offer their own online-video services. Powered by cloud-hosted video management software such as Kaltura, they will take advantage of their economies of scale, availability, reliability, and marketing resources to overpower many of today’s dedicated video SaaS vendors. Alternatively, an increasing amount of publishers will opt to self-host the video management platform behind their own firewall to allow for greater security, control, and flexibility.
Benjamin Wayne – CEO, Fliqz:
1. Amazon will follow Apple into the device business, producing an AmazonTV appliance to lock up the last mile between Amazon Video-On-Demand and the television set.
2. Hulu and Google will both get into the feature film distribution business, creating a four-way war between Netflix, Apple, Google and NBC to own four-screen film distribution.
3. Asia will surpass North America in consumption and monetization of online video – YouTube will fall behind Youku and Tudou as US video viewership peaks and Asia continues to soar.
Luke McDonough – CEO, RealGravity
1. Video ad nets start to feel the heat. I think 2011 will start to make 2010 look like the salad days…they have been printing money, but three factors will start to put a lid in that business in 2011:
- Video ad exchanges and DSP’s are encroaching fast, and they will start to clip ad network margins in 2011…see “evolution of display advertising” for reference.
- Adoption of VAST/VPAID has been fairly rapid already…inevitable, widespread adoption will level the playing field between “video” ad nets and “traditional” ad nets, which means a lot more competition.
- Direct sales, and ‘quasi-direct-sales,’ gobble up an increasing share of total video inventory sales. If you have your own team, and good video inventory, then you are sold out or nearly so. If you don’t have your own team, there are platforms like ours, among others, that give publishers access to something that is closer to direct sales than it is to ad network sales, and people are starting to figure this out.
2. Everyone will talk incessantly about connected TV’s in the wake of Google TV’s inevitable version upgrades, and Apple’s inevitable TV-related product and service announcements.Video ecosystem companies, (including RealGravity), will dutifully respond by spending lots of resources to develop all sorts of API connections and deals in the space, to make sure they are up to speed when customers and press ask them about this. But no one will make any money there, and the adoption of commercial web video on TV will take much longer than everyone thinks.
3. Connected TV’s will quickly become irrelevant, because mobile video, and geo-location, and mobile commerce tie-ins will all continue to explode, even faster than everyone thinks, which will buoy everyone in web video, and so no one will care that they don’t make any money on connected TV’s.
And one final thought, video publishers of all sizes and shapes will report that their syndicated video players generate more video views than their own properties do. Most will report that they also generate more revenue from their syndicated video inventory than they do from their own properties. I think this may already be true for most commercial video publishers, and so I apologize for predicting the obvious if that turns out to be the case.
Preetam Mukherjee – CEO, Marcellus.TV
1. The Eastward boom: Asia-Pacific, parts of Africa, and the Middle East are going to be the dominant mass markets consuming online video. Online content libraries are far richer than conventional TV channels in these markets, causing a massive spurt in consumption at work, and on mobile devices as well.
2. Freemium: 2011 will be the year of freemium, in online video. With the rapid increase of contextual content (trailers, previews, behind-the-scenes footage, interviews, etc.), and the marginal cost associated with delivering such content, a strong case is evolving for the introduction of freemium models as a lucrative alternative/supplement to ad networks.
3. CDN wars: with online video dominating internet bandwidth consumption, expect to see competition in the CDN market flare up in terms of pricing, infrastructure buildup, new cloud infrastructure services, etc. This will be tremendous for the online video market in general: revenue models are just beginning to take shape, and better delivery + lower pricing will greatly enhance the ability for content owners globally to make the most of their online video initiatives.
Christopher Savage – CEO, Wistia
1. I think we’ll see many more sites defaulting to HTML5 first with flash backup. It’s a trend we’ve seen recently that appears to be heating up.
2. I think we’ll see a huge new swatch of SMBs signing up and embracing video for more than just their homepage, but deeper richer content.
3. I think we’ll see a slew of new video production companies servicing the SMBs and small organizations within Enterprise by helping to make the production process smoother, faster, cheaper, and more transparent.
Ian Snead – VP Sales & Marketing, vzaar
1. Much more demand for security of online video content as video producers look to monetize video through subscription as apposed to pre-roll, etc.
2. I see more consolidation between traditional CDN vendors and full service OVP’s like vzaar as the market has now started to mature with more low-end SME publishers using online video.
3. Improved content delivery methods as viewing experience is king.
And there you have it, the near future of online video defined by those whom are making waves in the space. Stay tuned as VidCompare brings you more throughout the new year from the smart people who are paving the way of our online video future.
Thank you to Jeff, Steve, Ron, Benjamin, Luke, Preetam, Chris, and Ian.