Woburn, MA-based web video start-up Gotuit is the latest company trying to capture web viewing traffic. The company launched today its web video portal which, unlike YouTube or Google Video or other video content aggregating sites, is populated by only “professionally” produced video - e.g. video from AP, Reuters or music videos from record companies.
Gotuit is best know for supplying short video content for on-demand viewing to cable operators such as Adelphia and Time Warner. The privately held company is backed by venture firms Highland Capital Partners, Atlas Venture, Motorola and other investors.
Richard McManus of ReadWriteWeb has a good summary of Gotuit’s new web portal, highlighting the benefits (supposedly faster delivery of videos - a conclusion echoed by Mike Arrington at TechCrunch) and the concerns (namely, a very crowded web video marketplace.)
It’s hard to see how Gotuit will gain much traction with its video portal — professionally produced content is splashed all over the web (even here on IPD with our Reuters video link). YouTube, and to a far lesser degree Google Video and all the others, is popular precisely because it has a next-generation, renegade feel about it, a user-to-user flavor that appeals to the group most likely to watch web video: young people.
And established media companies may not like it, but YouTube offers “professionally” produced videos, often of the unauthorized kind. Clips of Daily Show sketches show up routinely on YouTube without Viacom or Comedy Central’s permission, but Viacom looks the other way because of the boost YouTube gives to the channel.
Posted by Cynthia Brumfield at 6:24 PM | Print | Comments (0)Incumbent telco BellSouth issued its Q2 06 earnings today showing strong profit growth on very weak revenue increases. Net income was $887 million, or $.49/share, compared to $795 million, or $.43/share, during the year-ago quarter.
Excluding one-time charges, net income was $1.08 billion, or $.60/share, a noteworthy performance given that the telco posted almost flat revenues. Revenues for Q2 06 (excluding the Cingular wireless arm) were $5.21 billion, up only 1.2% year-over-year.
But, and it’s a big caveat, local access line loss accelerated during the quarter, with BellSouth losing around 500,000 voice lines, more than double the 200,000 or so lines lost last quarter. Although mobile substitution and the loss of second lines due to increased broadband adoption played a part in this line loss acceleration, cable VoIP competition was cited by the company’s CFO Pat Shannon during BellSouth’s earnings call.
Around 50% of BellSouth’s territory has cable VoIP competition. Shannon danced around the fact that BellSouth is still facing only half the cable VoIP competition it will ultimately face by saying that “the markets vary widely” in terms of their impact on BellSouth’s core business or something along these lines.
Still, DSL growth continued along seasonal lines, with BellSouth adding a 128,000 net new DSL customers during the quarter, slightly above the 124,000 net adds during Q2 05. Moreover, as Shannon pointed out during the earnings call, customers are upgrading to higher-priced DSL tiers.
During the quarter, BellSouth added 159,000 net new customers for its 3/6 Mbps tier and gained 11,000 for its 1.5 Mbps tier. Its least expensive tier, which offers download speeds of only 256 kbps, lost 42,000 customers.
Quarterly DSL revenue rose by almost 40% between Q2 05 and Q2 06, rising from $287 million to $400 million. The high-speed service, which for years had been an unprofitable option, is now a big contributor to the bottom line.
As Shannon said during the earnings call, “in the second quarter, we generated $400 million in DSL revenue, up $113 million year over year and very little change in the cost of DSL. Almost all of that fell to the bottom line.”
| BellSouth Operating Statistics | |||||
| 2Q05 | 3Q05 | 4Q05 | 1Q06 | 2Q06 | |
| Total access lines (mil.) | 20.8 | 20.4 | 20.0 | 19.8 | 19.3 |
| Change | (0.4) | (0.4) | (0.4) | (0.2) | (0.5) |
| % change | -2% | -2% | -2% | -1% | -2% |
| DSL customers (000) | 2,473 | 2,678 | 2,882 | 3,145 | 3,273 |
| Quarterly adds (000) | 124 | 205 | 204 | 263 | 128 |
| % chg. in quarterly run rate | -51% | 65% | 0% | 29% | -51% |
| Video (000) | 394 | 460 | 523 | 628 | 691 |
| Change | 80 | 66 | 63 | 105 | 63 |
| Source: Emerging Media Dynamics, Inc. analysis of BellSouth data. | |||||
Posted by Cynthia Brumfield at 4:59 PM | Print | Comments (0)
The Internet and media worlds are awhirl today about this Business Week scoop on a new video venture apparently being formed by Kazaa and Skype founders Niklas Zennstrom and Janus Friis. Code-named “The Venice Project,” the venture is developing software for distributing TV shows and other kinds of video over the web.
The Project is snapping people to attention because of its co-founders — Zennstrom and Friis have a track record for creating disruptive technologies that alter the course of the media and communications world. Zennstrom and Friis, who technically work for eBay after selling their Skype VoIP venture last fall to the online trading giant for $4.1 billion in total compensation, have, according to the piece, assembled teams in a half-dozen cities, including London, New York and Venice. It’s not clear if eBay is involved in the effort, although it sounds like the company would be an investor of sorts.
The venture is also reportedly attempting to work out deals with TV networks in order to offer a legit service, unlike Kazaa, which was much-despised by the music industry.
This news no doubt sends shivers down the spines of cable and satellite operators, who already fear that the broadband Internet is turning into a video bypass platform. As the Business Week article and other observers have noted, Zennstrom and Friis are entering a market already loaded with web-video distribution tech start-ups, including BitTorrent, BrightCove, Veoh and VideoEgg, just to name a few.
Still, the pair’s track-record at creating havoc, and the high-profile this venture will receive, gives “The Venice Project” the ability to create some momentum toward accelerated web distribution, and that can’t be good for traditional distributors. As John John Paczkowski at Good Morning Silicon Valley put it:
Still, if anyone can pull something like this off, its Zennstrom and Friis, who’ve built their career on upending the traditional communications and media establishments.Posted by Cynthia Brumfield at 3:44 PM | Print | Comments (0)
David Carr has this interesting piece today on journalists and how they are creating their businesses on the web. Carr focuses on Nina Monk, former Fortune writer and author of the AOL myth-destroyer “Fools Rush In,” who, while still pursuing her business writing career, runs a web-based business Urbanhound.com.
But, Carr also raises the examples of Om Malik and Rafat Ali.
Content may or may not be king, but it’s mighty valuable. Journalists, who know a thing or two about its creation, are beginning to build sites that help them maintain custody of the content and, if all goes well, reap the rewards. Om Malik, a former writer for Business 2.0, has received backing for GigaOM.com, a technology news Web site that has broken a number of stories, and Rafat Ali, the former managing editor of The Silicon Alley Reporter, recently received funding for his company, which publishes PaidContent.org, a site that covers digital media news.Posted by Cynthia Brumfield at 7:02 AM | Print | Comments (0)
“A lot of journalists are going to have to rethink what they are doing if they are going to survive,” said Mr. Ali. “If you stand back and do nothing, what are you going to do with the rest of your life? The newspaper you are working at could go away and then you won’t have a place to work.”
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