Hedge funds and derrivative traders have a lot to answer for in the way they skew markets, but oil and pork bellies are nothing if you look at the inefficiencies of the video content market.

Affected by everything from residuals to the lack of a trading platform, the market is crying out for efficiencies. Who will step up to the mark ?

With standards such as MRSS and increasing open-ness on the main UGC sites, there is a real business opportunity to broker content online. Getty Images, the world’s largest photo library is getting in on the act with stock video, but online provisioning by production companies is, to say the least, pathetic. I guess everyone prefers to turn up to the mediafests at MIP twice a year. the best example I was able to find was the BBC’s Motion Gallery. I’d love to hear about anyone that’s working on developing an online programme marketplace.

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The Perfect Market

DMGT is one of the UK’s largest publishers and owner of many successful online properties. Its latest results reveal that online revenues still account for less than 2% of overall revenues.

It shows the terrible predicament for traditional media companies suffering from the ‘advertising gap’. Quite simply, the difference between old world media ad revenues and new world ad revenues is called Google.

The only salvation for the old worlders is to implement a long tail strategy IMHO, but even ownership of a national newspaper, several local newspapers and several niche websites hasn’t helped DMGT.

The only question for those of us in the internet TV world is ‘will YouTube have the same effect on internet TV?’. Somehow I think not. The major media groups are realising this and launching video services is now high on their agendas.

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Drop In The Ocean

If anything bodes well for Kangaroo/Seesaw it’s the statistic that 75m people have downloaded the BBC’s iPlayer, which should (geospoofing notwithstanding) only play to UK based viewers.

Now, the population of the UK is well under 70m, and around 55% of those have broadband, so there are over 30m people unable to watch programmes on iPlayer. That’s one hell of an audience to start with if you’re launching an IP over TV service.

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High Stakes

Hubris probably makes me the worst person to comment on the Internet TV platform marketplace, but, here goes.

For the record I’ve always had high regard for (what is now) Comcast’s theplatfom and of course, I would always have backed Narrowstep’s technology since it was my ‘baby’; but I always felt that the technology of the other major companies in the market was always limited in one way or another. This does not mean that they did not have their applications, but they were not in the same ‘toolbox’ category as Narrowstep and theplatform, in my opinion.

Roo and the FeedRoom concentrated on basic platforms with integrated content; Brightcove have tried to appeal to the longtail, the n changed their business model over and over and are now prohibitively expensive to all but a handful of client; Maven are a reseller for theplatform that got lucky (Yahoo are total idiots), and now are interested in a handful of media owners only.

The worst thing about all of these companies is that you’re almost always better off developing your own apps, making your own mistakes and then owning your platform (a $500k or so gamble). Basically, the pricing in the market means that the major players insist on taking machine guns to their feet…

And if you really want to get confused about this marketplace, read the ramblings of the self-styled guru and meglomaniac Kaleil Isaza Tuzman (who renamed Roo with his own initials) here. Buying video recognition and mobile video software companies would seem to be masterstrokes apart from the fact that the former doesn’t have any applications and the later has no market as yet. And, as he states, he’s moving out of the US in order to win 30% of the Fortune 1000 companies as customers, all paying him $3m each. Hmmm.. Most of his customers are in Australia because that’s where the company came from (and most of this revenue comes from online marketing) and his investment money comes from the Gulf, so that’s where he’s gravitating. This guy is selling snake oil, but heck, that’s where Coca Cola came from…

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Mis KIT

The latest communications market report from Ofcom is out this morning and throws up some intriguing statistics about broadband usage in the UK. It seems that Sunderland (66%) is the most wired town in the UK, with Glasgow (32%) the least wired; this is surprising since the Highland & Islands area is amongst the most wired. Indeed the report comments that more of the rural population have broadband access than the urban population – but, the report fails to comment on the quality of service in these areas, as well as the lack of LLU and competition.

Forty per cent of the UK population now watch video online – internet TV is most popular in Edinburgh (45%), with the lowest viewing in Newport in Wales (19%). Indeed, broadband is lagging behind overall in Wales, where the Welsh Assembly Government should be doing far more to promote provision and usage.

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