Even advocates of the digital video industry are saying that you'll be squinting for a while longer at those postage stamp-size video playback windows on your PC.
There's just no way to stream multimegabyte video files to mass markets without choking the Internet's backbone network, said participants at the Digital Hollywood Broadband conference recently in San Jose, California. Opinions differ on what technology will eventually unclog the pipes, but the consensus is that the solution is years away.
Part of the problem is the nature of what is dubbed a "four-tiered Internet" by Jonathan Seelig, Akamai Technologies Inc. founder and vice president of strategy and corporate development. The real bottlenecks are not in the first mile (from the content providers) or last mile (to consumers), but rather in the entry and exit points of the 7000 diverse networks comprising the Internet backbone, Seelig said.
His solution is to deploy Akamai servers in all 7000 of those networks to serve as an "edge delivery platform" that conserves network bandwidth by bringing content closer to consumers. But deployment of such edge networks able to serve a large percentage of the Internet's content is years away.
A different vision of the Internet's broadband future came in a presentation by Google Inc. founder Larry Page, who's also the company's chief executive officer.
Page didn't tell the audience of entertainment and technology executives anything they didn't already know when he declared video on the Internet is expensive. But what did catch the audience's ear was Page's claim that Google's capability to target its text-based ads to searches has resulted in a click-through rate four times the industry average. Page said Google advertiser Eddie Bauer realized revenue four times of what it spent on its ads on the service.
One hallmark of a technology that's not ready for prime time is the great number of neologisms it spawns. Among the coinages repeated throughout the conference were "T-commerce," "Advertainment," and "walled gardens."
Television commerce (T-commerce) takes the Home Shopping Network to a new level by allowing enhanced-television viewers to click a button on their TV screen to buy a product or service just as they would click a "Buy it" button on a Web site. The anticipated arrival of set-top boxes in retail stores this summer is expected to deliver this impulse-buy capability to TV viewers.
With advertisers disappointed with their returns on investment in banner ads, WildTangent Inc. is pleased to offer the "Advertainment" alternative in the form of sponsored games. As an example, WildTangent cofounder and CEO Alex St. John cited the recent Toyota Adrenaline game that he claims made it into the top ten at Microsoft's Zone.com game site.
Several presenters used the term "walled garden" to describe a premium space created by interactive television and populated by viewers just begging to buy a specific product or service. It's not clear how interactivity will deliver this audience economically.
Another term that dominated several of the panel discussions raised a crucial issue for the would-be leaders of a new industry: "monetize," as in, "How are we going to monetize these technologies?"
The term appears to differ from "commercialize" in that it's an expression of the desire to sell services to a small number of large telecom and cable companies that will pass the cost to their customers in monthly bills. Because of the infrastructure expenses, it's too costly for vendors to offer such technologies directly to consumers.
Consumers and industry-watchers may face an interesting show. Many of these new entertainment technologies will depend on alliances between the current big names in media and electronics. Yet the dinosaurs risk being out-innovated by up-and-comers who know how to look beyond conventional mass markets.