How Joost lost its way

1 07 2009

Joost yesterday confirmed it was pulling out of consumer-facing services. Where did it fail where Hulu succeeds?

Lesson number one: when breaking a new product category, be modest, even if you were the founders of Skype and Kazaa.

Lesson number two: if you’re dealing with a media and entertainment industry sh*t scared about its future, be humble and straightforward. Suggesting that you’re about to replace television would be the wrong approach.

Lesson number three: speak a language that TV networks understand. Get them in the comfort zone and build.

Three simple reasons why Joost only had black and white episodes of Lassie and vids of girls in bikinis.

The arrogance of its founders was its principal failing.





Joost – what went wrong?

6 04 2008

It was heralded as re-inventing the TV paradigm or the end of TV as we know it, yet barely a year after its public launch, online video service Joost appears to be lurching from one crisis into another. The service is planning a major retrenchment, reports the UK’s Sunday Times newspaper, “after failing to attract enough users and top-flight broadcasting rights.”

Joost was the one service guaranteed to get the digerati foaming at the mouth, with the kind of gushing enthusiasm normally reserved for the latest Apple gizmo. The company struck gold early in its history by opportunistically inking a content deal with Viacom – some speculated it was less about Viacom making a serious push into the brave new world of web video and more one-in-the-eye at YouTube, which it is currently suing for alleged copyright infringement.

The online video market has evolved considerably during the last year – most if not all of the big broadcast networks have launched or beefed up their offers: NBC Universal and NewsCorp. have bowed their “YouTube-killer” portal Hulu; the BBC iPlayer eventually made its debut and ‘Project Kangaroo’, the JV between the BBC, ITV and Channel 4 looks set to create a new online video powerhouse later this year.

Meanwhile Joost, requiring users to download and install a desktop application, populated with pedestrian content, is in danger of looking as cutting edge as a parent at a school disco. Moreover, at a time when play now Flash streaming has become the de facto user experience, Joost feels clunky by comparison. True, Apple’s iTunes also requires users to install a desktop app, but it does boast some heavyweights as content partners.

It’s a cruel twist of irony that the ‘revolutionary’ service which looked set to shake up the TV paradigm is in danger of looking so web 1.0 at a time when video is so seamlessly being woven into the fabric of the rest of the web. Joost is retrenching from global markets to focus on the U.S., says The Sunday Times – something it probably should’ve done in the first place.

Moral of the tale #1 is that striking gold very seldom happens more than once in succession – something the entertainent industry understands well. Joost’s founders Niklas Zennström and Janus Friis may have turned the telecoms industry upside down with Skype, but thus far Joost has failed to establish itself as anything more than an over-hyped vanity business.

Moral of the tale #2 is under-estimate the deeply-entrenched business models of media and entertainment incumbents at your peril.

The future for Joost? Renewed focus on the U.S. will likely help the service to leverage its strengths and build a significant niche market. Eventually its founders will tire of it and likely offload it to a media heavyweight. beyondnessofthings predicts Viacom will buy it at fire auction rates.

Update: Joost has rebutted yesterday’s story in The Times, telling paidContents Rafat Ali that it’s not planning any major layoffs, though it is doing a “re-alignment” (not to be interepreted as a sole focus on the U.S. market). beyondnessofthings accepts that Joost may not be refocusing its activity to the extent outlined in the Sunday Times report, but stands by the comments stated above.





Indies embracing the web and new platforms

3 02 2008

The growth of new distribution opportunities via the internet has prompted some independent production companies to find additional options for exploiting their content, while others are producing content specifically for the web.

Here’s a round-up of some of the key players so far:

  • Miles Beckett and Luke Hyams, the co-creators of LonelyGirl15, are rightly dubbed the kings of social networking drama. The duo have gone on to form LG15 Studios, with backing from Hollywood talent brokers Creative Artists Agency, deepening their relationship with Bebo by producing Kate Modern.
  • Veteran U.S. independent Mark Burnett Productions, best known for a slew of reality TV formats, has been actively syndicating derivative programming to web portals for a number of years. Its series Rock Star: INXS was offered via MSN, albeit as an enhancement / spin-off to the linear show. However, the company is getting more active with pure new media plays: last September it launched Gold Rush, an online reality game via AOL.
  • Ex-Disney chief Mike Eisner’s Vuguru was founded in March 2007 and rapidly cut through with Prom Queen, a scripted drama comprising 80 x 90-second minisodes, distributed via its own site , YouTube and Veoh (which Eisner is also backing).
  • U.K. indie RDF is currently developing Rough Cuts. a comedy portal featuring full-length download-to-own programmes from its own catalogues (RDF is a distributor, as well as a production company), other independents and, it hopes, under license from broadcasters. Last July, the company’s U.S. offshoot inked a licensing deal with Daily Motion.
  • Endemol – the company which brought the world Big Brother – was one of the first major indies to license its back catalogue content to U.K. IPTV service BT Vision, as well as to pure web plays, such as Joost and newcomer Next.TV. The company is also producing Gap Year, a web exclusive travelogue for Bebo. At the C21 Future Media conference in London late last year, Endemol’s Peter Cowley, managing director of interactive media, disclosed that its digital division was contributing between 10 to 20% of overall revenues.
  • FremantleMedia’s strategy focuses on marrying up excellent creativity, low budgets and profitability. The company – behind linear hits such as American Idol – owned by media conglomerate Bertelsmann subsidiary RTL Group, has a new platforms division overseen by programme syndication veteran Gary Carter. Aside from licensing deals, the company’s key new media property is web and mobile comedy channel Atomic Wedgie, an aggregation of younger-skewing short-form programmes which achieved nearly 3 million views via MySpace during Q4 2007. The company is working on an interactive drama format for syndication to web aggregators during 2008.
  • IMG and its television division TWI has established a fearsome reputation for global syndication (the business was built out of sports talent management) and boasts a programme catalogue of 250,000 hours of premier sports events (Wimbledon, the PGA Tournament and U.K. Premier League are among those it represents). The company has been developing content propositions for new platforms – albeit based on wobblier technology than today – as far back as 2003. The company’s Gamer.tv format (which enjoys the dubious distinction of being banned in China) was one of the first made-for-TV shows to be syndicated to web portals, such as MSN.




The U.K. VOD market – nascent but growing

2 02 2008

Policy wonks, quango officials and broadcast executives met in central London last Thursday to debate the state of the U.K. VOD industry: offering perspectives on incumbent services, those soon to launch, rights management and pending regulatory changes.

Unsurprisingly, the first half dealing with audiences, programming and business models packed them in, while 90 minutes on regulation drove half the audience away, and left the other half in near coma.

Virgin Media’s charismatic Malcolm Wall, CEO of Content, hailed the success of VOD rollout on his platform, proclaiming that “the UK market is coming of age.” The service offers 3,700 of video content, including around 1,000 hours of catch-up TV from broadcasters such as the BBC and Channel 4. Just under half of Virgin customers use the service at least once a month (this compares with around 70% of Comcast subsribers stateside), with around 30% of views to catch-up TV. Some 270 million pieces of content viewed during 2007. His prediction that VOD viewing on the platform would soon outstrip linear viewing of terrestrial channel Five was built on with the further portent that 20% of UK viewing would be non-linear within the next five years. But most striking of all was his disclosure that subscription-based viewing is rapidly replacing pay-per-view.

Both Wall and BBC Future Media Group Controller Erik Huggers used their respective turns to plug the impending launch of a “10 foot” version of BBC iPlayer on the Virgin Media platform, due Q2 2008.

Channel 4’s Sarah Rose, Head of VOD and Channel Development, asserted that partnerships with TV platform partners Virgin, BT Vision and Tiscali TV were “fundamental” and responsible for generating the majority of views to the broadcaster’s 4oD umbrella brand. The biggest mindset change for C4, Rose said was developing approaches for customer relationship management, investing in software functionality and developing new approaches for compliance in an environment where the 9pm watershed is immaterial.

4oD online has an installed base of 1 million users (those who have installed the service software) and unsurprisingly the constituency is 60% male. More striking though was the suggestion that the most active of registered users skews female. Around two-thirds of online users are under 35. No surprises that comedy, drama (about a third of all viewing) and entertainment lead performance, but minority interest programming also does “disproportionately well”. The service is split between around 3,000 hours of (mostly free to view) archive – some of which can “engender loyalty to series” – 60 to 70 hours of new catch-up TV every week and around 300 films.

But there were two star turns at the event: Paddy Barwise, Emeritus Professor of Management and Marketing at the London Business School, and Roger Edmonds, a freelance journalist and one of the key figures behind UKNova, a BitTorrent site which specialises in British TV programmes.

“Calm down dears,” was Paddy Barwise’s opening remark, attempting to balance the boundless enthusiasm of incumbent providers with the reality check that for the overwhelming majority, linear TV rules. Barwise said that while announcements from major players were creating enormous developments on the supply side, but the demand side remained sluggish. Adding: “let’s have a bit of huimility about what will or won’t work, before throwing out too many babies with the bath water.”

John McVay of independent producer trade body Pact chipped in with the challenge that broadcasters may like to consider boosting spend on quality programme-making, before over-investing in technical platforms which were yet to prove themselves with mass audiences.

Roger Edmonds of UKNova threw down the gauntlet to U.K. broadcasters, promising that when they could fully meet the demand for British TV programmes that he sees from his users with a free service, he’d close his site down. With a nod to Project Kangaroo, the soon-to-launch on-demand joint venture between U.K. terrestrial broadcasters, he decried the scarceness of choice from traditional players.

Jeremy Olivier, Head of Convergent Media at regulator Ofcom issued the rallying call which cleared half the room, and devoted his piece to changes ushered in by the European Audiovisual Media Services Directive, which compels member states to move to more robust regulation of the VOD sector, including greater protection from content which may harm or offend vulnerable audiences. Ofcom has pulled together an industry panel to





Politics: the great online video turn-off

28 12 2007

Market researchers Harris Interactive reveal the less-than-earth-shattering news that only a third of online video users favour political content.





Online video P&L watch

6 12 2007

beyondnessofthings will update this post as figures emerge. Meanwhile some companion reading at Silicon Valley Insider:

Economics of Online Video 1: One Tough Business

Economics of Online Video 2: Unit Cost Structure

Estimating Financial Impact of iTunes/NBC: Small, For Now, But We Still Expect Reconciliation

NBC Universal / iTunes: NBCU may have pulled its shows off iTunes, but last year’s profits, representing 40% of all TV content on iTunes, were US $15 million [source: Multichannel News, 3 Dec 07]

Walt Disney: The Mouse expects to generate around US $25 million in revenues from digital downloads in the fiscal year to Sep 2007 [source: CNN Money , 7 Feb 07]





Gimme more online video, just don’t make me pay

5 12 2007

U.K. law firm Olswang has published its annual Convergence Report, tracking British consumer attitudes to online and on-demand services. This year’s study reveals that almost a third of broadband users are regular consumers of online TV or movies – but they don’t want to have to pay for the content.

When the ‘Kangaroo’ JV between the BBC, ITV and Channel 4 launches next year, it’ll be interesting to see what mix of business models are offered.

In a related development, BT is experimenting with ad-funded VoD on its Vision IPTV service. A sign that PPV is RIP?





Knocka TV: yet another online video identity crisis

4 12 2007

knockatvs.pngRoi Carthy reveals that user-generated video portal Knocka TV [might need a rebrand for U.K. users :)] is to launch later today, following four months in beta.

The Israeli start-up is backed by the founders of instant messaging service ICQ, sold to AOL in 1998 for US $408 million.

Testing the limits of contradictory language, the service bills itself as “a user generated professional television network” [so which is it?] Reading on in the blurb, it’s clear that Knocka is attempting to position itself alongside Sony’s Crackle, as a stage for contributors with some modicum of creative prowess, as oppose to the Jackass-a-likey videos clogging up YouTube.

Unlike similar moves by Sony’s Crackle and News Corp.’s MySpace to beef up professionally-produced uploads, Knocka appears to lack the scale of the others’ parent companies, which are able to offer incentives such as development deals with other divisions, such as TV networks.

Knocka’s declared launch proposition is a confusing mix of social networking and online video buzz jargon — doubtless there so that its backers can swiftly offload it on to some hapless investment consortium. Promised are ‘channels’ offering “viewers’ creations”, “hip indie music” and an endless stream of scantily-clad babes masquerading as a “fashion” channel. An extreme sports ‘channel’ is also claimed to be in development.

Quick take: at first sight seems like a cynical attempt to connect with young males, claim a record user base and then flog it off to idiot investors at a time when the market is about to nosedive (again). $408m may not buy you common sense, for everything else there’s a black AmEx…





2008: the big online video shakeout

3 12 2007

Against a predicted backdrop of wider market turmoil as we enter 2008, Reuters ran a great piece last week on the likely impact of broader market declines on a sector which remains a major buzz with industry and consumers alike [even though, privately, I suspect alot of ramping from investors when it comes to the former, and a slow, but gradual paradigm shift among the latter].

Sure it makes for good copy fodder at a time when the pain is spreading through to consumer, as well as institutional investors [just a foretaste of things to come, IMO]. But the Reuters piece has a point: both large media corporations and, crucially, the advertisers, which in most cases support them, will have difficulty in justifying unproven activity amid a climate of investment conservatism.

You need only look to what some would call a landgrab, others pure speculation, which has been the key characteristic of the new media landscape during 2007.

Fast forward to 2008:

  • Mass media is broadly spent when it comes to genuinely new ideas or connecting with the ways in which consumers will likely connect with them, thus… 
  • Those propositions which can demonstrate consumer uptake, if only on a micro level, will likely attract the acquistion interest of the majors. This will come at a time when second or third round financing is non-existent; nowhere else to turn.
  • The valuations placed against those in the vendors’ market will be attractive to the potential purchasers [a parallel with real estate and company valuations, in general, anyone?]
  • Advertisers will wake up to this landscape beyond the hyperbole of press releases — not least a result of both clents and their agency handlers haemoraging revenue against the splattergun accountability which is linear, vs. an emerging landscape of robust [did anyone say actual?] metrics which non-linear promises. I can relate from first hand experience, that the majority of blue-chip agencies do not have a clue about what they’re doing or propose to do in this space.

The winners:

Sorry, you won’t like the answer: big media corporations

The losers:

Emergent ideas which just might’ve turned into something genuinely different, had they been in the right place, at the right time.

Tighten you’re belts everyone, 2008 ain’t gonna be pretty… [and i didn’t even mention the ‘R’ word once…]





Australia’s ABC launches online video destination

3 12 2007

Following the trend from major TV broadcasters around the world to launch branded video players, Australian public service net the ABC has today unveiled ABC Now.

abc_now.jpg

The service aggregates national and local TV, radio and news content from the ABC into a single downloadable player application. The PC version, built with Flash 8 and MProjector, has just been released in Beta, with a Mac version to follow “soon”.

Unlike equivalent services, such as the BBC iPlayer, ABC Now’s initial content offer is far less ambitious: alongside news, weather and sport bulletins the roster of popular TV shows features home-grown productions, such as The 7.30 Report, At the Movies, The Cook and the Chef, Gardening Australia, Enough Rope, Good Game, Insiders, Media Watch and The New Inventors.

But ABC Now does also include a selection of vodcasts – something BBC iPlayer doesn’t.

In a final twist of irony, offering a broader selection of programmes the ABC shows is doubtless down to the BBC’s commercial arm, BBC Worldwide, which licenses many of the corporation’s most popular shows and formats to the Aussie PSB.





Dangerous Dave embraces Gen YouTube

11 11 2007

The U.K. Conservative Party is reaching out to connect with the online video generation by launching its own channel on Friction.tv, a social network aimed at stimulating political debate, founded by Omer Shaikh, the former head of Saatchi & Saatchi Interactive. 

A short film about party leader ‘Dangerous Dave’ Cameron’s recent visit to California and his campaign to make poverty history in the U.K. are among the first films uploaded by Tory Central Office. A couple of new films are promised every week.





Hulu: thin on content, high on usability

11 11 2007

Online Video Watch gives its verdict on the Hulu private beta over in this post. The service scores highly for ease-of-use and discoverability of content, but poorly for the extent of the content offer itself.

However, that may be about to change, says the Hollywood Reporter, revealing that Warner Brothers Television is in discussions with Hulu, which will likely see a selection of its catalogue added alongside that from Sony and MGM, as well as Hulu co-founders NewsCorp. (Fox) and NBC Universal.

In related news, paidContent offers a pretty blunt assessment of NBCDirect.com, a new TV downloads service which offers content for seven days from broadcast and viewing for 48 hours once first played.





Skinkers second round funding

30 10 2007

Back in July beyondnessofthings reported on Skinkers, a U.K. based company which has been working with Microsoft on a software solution for streaming of live TV. econsultancy reports that the company has just sealed a deal for US $16m (£8m) in second round funding from a consortium led by Acacia Capital Partners. Consortium members include Spark Ventures, which provided $3.5m (£1.7m) in February 2006.

Skinkers will reportedly soon start trialling its LiveStation product with broadcasters





Hulu bows today

29 10 2007

One of the most eagerly-anticipated online video launches Hulu, the tie-up between NBC Universal and NewsCorp., launches in private beta later today, following a week of preview access for journalists and analysts.

The service rolls out with most of the trailed features, reports Variety, including the ability for users to share entire shows or just clips of them with eachother.

Hulu has also inked a deal with Sony Pictures Television for 40 TV series, and Metro-Goldwyn-Mayer Studios for an undisclosed number of series and movies.

All featured series will run with two minutes of commercials per hour, in the form of unskippable 15 and 30-second spots.





TV nets face up to growing online competition

25 09 2007

Variety reports on the latest online video forecasts produced by market analysts Screen Digest: the U.K. market for online TV will be worth £181 million (US $362 million) by 2011, but growth of the online movies segment is predicted to be slower.

There’s no doubting that across the Pond, the competitive environment is really gaining traction, as observed by the Financial Times: in the two years since that watershed moment when iTunes first started offering download-to-own TV shows from Disney, all of the major networks have scrambled to not only beef up their own sites, but also to broker those all-important third party syndication deals.

In the last week alone, Walt Disney-owned ABC has agreed a deal to syndicate its shows, for free, via AOL. The net joins CBS, which has been aggressively pursuing its own syndication strategy for the past few months, while Hulu.com, the online video aggregator site JV between NBC Universal and NewsCorp. is due to bow next month.

Hopping back over the Pond to the U.K., the BBC, ITV, Channel Four and five all have online catch-up TV services: the BBC offers the broadest range and volume of hours, while ITV and Channel Four are increasingly bolstering their catch-up offers with back catalogue shows. Satellite broadcaster BSkyB is broadening its Anytime service, with different flavours of the catch-up service available both via broadband and Sky+ DVRs; the company’s recent pact with Sony will also see an extension of the service for Playstation PSPs.

The Screen Digest research referenced at the top of this post acknowledges that established players such as TV networks also face competition from non-traditional market entrants, such as Joost and iTunes. Significantly, it may be players such as Apple and Microsoft, which stand to gain the most if they can finesse their strategies to leverage consumer relationships through ownership of devices, such as iPods, or the world’s most uniquitous operating system.

Four predictions of my own:

  1. The last year or so has merely been about positioning and trying to establish which online video offers work, and which don’t. Note CBS is moving beyond merely offering full-length TV shows online and gradually ramping up 2.0 functionality: conversational content. 2008 will see the space grow up considerably. 
  2. Whether it’s aggregators or TV networks’ own sites, online video offers are principally restricted to ‘walled gardens’ of content, usually from the operating network or a select few content partners. This is wholly alien to the TV viewing experience: consumers don’t watch shows from a single network or producer. The walled garden approach smacks of protectionism and, over the fuller term, it won’t last for all but the smallest handful of players. The creation of Hulu.com is the first acknowledgement by two major players that hybrid partnerships such as thes, which broaden out the available content offer, are the way to go. YouTube is further evidence of a successful broad-brush aggregation model – albeit with some copyright complications.
  3. The market is already overcrowded: come further shocks to the world’s stock markets (an inevitability), watch the venture capital evaporate. Incumbent players looking to second or third round financing, against a backdrop of unproven business models (let alone profit) will shutter or consolidate. Viacom had better be hoping that it can pick up the assets of Joost for a song.
  4. Apple TV and Microsoft Media Center are the first two examples of mainstream PC/TV convergence: but neither has yet created a compelling enough content offer nor low enough price points to give the products a reasonable run at setting the market alight, beyond early adopters. Next gen games consoles from Sony and Microsoft will up the ante by gradually bolstering their IP-delivered VOD offers, but even these may struggle to break through beyond gaming loyalists. Either some boffin will come up with the cheapest and most elegant plug-and-play convergence-enabler – witness what Freeview set-tops did for the U.K. market – or new product categories, such as networked DVD player / recorders or DVRs will hit that magic tipping point of attractive pricing and mainline retail distribution.




Enter the Joost-alikes

11 09 2007

When online video aggregator overhauled its user interface, it was with more than a nod towards the approach taken by incumbent service Joost.

Next came a mash-up of Joost and YouTube, brought to us by enthusiast Paul Yanez (who has done the same with iTunes and Babelgum; though running more than one of these at a time will likely crash your machine).

Now the sincerest form of flattery of all, DNAStream is offering a service which slavishly looks like Joost, but purports to be from another service provider. However, unlike Joost the service requires no client to be downloaded and runs in a standard browser window, nor does DNAStream provide any information about itself on the site (presumably, for fear that Joost lawyers will come-a-knocking).





Warner Bros. gets serious about web 2.0

10 09 2007

Following last week’s news about Warner Bros. online video deal with ABC, comes this coverage in the New York Times, reporting that the studio is to ramp up the creation of original programming for the web, marking a significant change of strategy.

Warners had previously hedged its bets on getting advertisers to take on the risk of funding such content, but the new initiative means that it will dig into its own pocket to get a slate of 24 new web formats into production. But the sums involved are still small beer compared to the traditional side of the business: the two dozen new titles will cost US $3 million, equivalent to funding required for an hour of prime time TV drama.

The new slate includes mini-movies, games and episodic TV shows such as:

  • The Jeannie Tate Show — a 10-parter about a neurotic mother, who presents her own TV talk show from her minivan;
  • A puppet comedy for grown-ups, created by the Jim Henson Company;
  • An online dating game, from the producer of Gilmore Girls;
  • An animated spin-off from The Wizard of Oz;
  • Viral, a tongue-in-cheek mockumentary from Joey Mandarino and David Young, charting the fortunes of a studio trying to come up with the next big online hit (think Seinfeld for the digital age);
  • And an, as yet, to be disclosed project from Joseph McGinty Nichol, one of the directors of Charlie’s Angels.

The studio has also announced its answer to Second Life: T-Works, an immersive web experience based on its Looney Tunes, Hanna-Barbera and DC Comics franchises, fusing elements of a virtual world, social networking and games. The new site, launching in Spring 2008, will run full-length episodes of cartoon classics, such as Bugs Bunny, Scooby Doo and The Flintstones alongside the new web-exclusive short-form content outlined above.

Users will be able to create their own avatars, based on Warners’ toon characters, as well as video mash-ups and profiles. Significantly, users will also be able to embed material both on third party sites, such as social networks, and on their own desktops.





Will online video cause the net to melt?

8 09 2007

No, claims The Exabyte Era, a 24-page white paper from Cisco Systems.

Extract from the Exec Summary:

YouTube is just the beginning. Online video will experience three waves of growth.

Thanks to the YouTube effect, online video has grown rapidly. In North America, online video has jumped from 7 percent of traffic in 2005 to18 percent of traffic in 2007. In response to this remarkable development, many service providers are accelerating their capacity upgrade plans. But the Internet is not collapsing under the weight of YouTube traffic, nor is it likely to.

Global online video traffic is still relatively modest at 11 percent of consumer Internet traffic, and even as it increases four-fold between 2007 and 2011, Internet video to the PC screen will soon be exceeded by a second wave driven by the delivery of Internet video to the TV screen. Beyond 2015, a third wave of video traffic will be driven by video communications.

Other highlights:

  • IP traffic will nearly double every two years through 2011
  • Consumer IP traffic will surpass business IP traffic in 2008
  • Peer-to-peer (P2P) download traffic will quadruple between 2006 and 2011 (the equivalent of 10 million DVD’s-worth every month growing to 750 million DVD’s-worth every month)
  • But P2P will decrease as an overall proportion of internet traffic, but until 2011 it will grow by CAGR of 34%
  • Global internet video traffic (excluding P2P) already generates more traffic than the entire U.S. backbone in 2000; by 2011 this is expected to grow by a factor of 86
  • Internet video-to-PC and TV will increase ten-fold each thru 2011
  • The internet is not collapsing under the weight of YouTube video traffic, nor is it likely to
  • The second wave of online video adoption will be marked by a growing appetite for high-definition content: 40 hours of hi-def TV is equivalent to one million email messages




Another online video aggregator claims DMCA safe harbor defence

8 09 2007

In a move with echoes of an earlier clash between online video aggregator Veoh and Universal Music Group (UMG), DivX has taken pre-emptive legal action against the latter.

Like Veoh’s lawsuit, DivX cites the safe harbor provisions under the Digital Millennium Copyright Act (DMCA), which protects service providers and ISPs from copyright infringement by their users. Veoh had placed its bets on the pre-emptive action discouraging UMG from filing its own lawsuit.

Veoh’s hopes on this were dashed last week when UMG did indeed follow through with legal action, blending elements of Viacom’s writ against Google and the music industry’s just concluded lawsuit against Napster, says this report in Wired.

The UMG v. Veoh lawsuit alleges taking “mass infringement on the internet to a new and dangerous level by supplying the public with an integrated combination of services and tools that make infringement free, easy and profitable for Veoh.”

In the spat between DivX and UMG, the handbags are out:

“UMG’s pattern of attacking innovative online service providers is discouraging and will ultimately hinder innovation and the development of new technologies,” said David Richter, executive vice president of corporate development and legal for DivX.

Peter LoFrumento, UMG senior vice president hit back with: “Universal Music Group has been in negotiations with DivX and recently offered them a deal that would address the rampant copyright infringement occurring on their service and fairly compensate our artists and songwriters for the use of their audiovisual works. Universal is committed to supporting innovative new digital services, as evidenced by our deals with YouTube and others…  DivX’s purpose is to build traffic and sell advertising off of unlicensed content that is clearly illegal.”





Apple to halve cost of iTunes TV downloads; supplier rebellion brewing?

7 09 2007

Apple is planning to cut the cost of TV downloads via its iTunes service from US $1.99 to just 99 cents, reports Variety.

The move would create a single price point for both audio and TV downloads, which Apple believes will drive consumption for the latter category, which remains completely dwarfed by equivalent music track downloads. Given Apple’s success in dominating the digital downloads sector, any changes to pricing could prove an adrenalin shot to sales of TV downloads.

It’s reported that pricing for movie downloads will likely remain unchanged and there hasn’t been any comment on price points for the recently-launched TV downloads offer via the iTunes U.K storefront, where shows sell for double the existing equivalent price across the Pond.

Reuters builds on Variety‘s coverage, suggesting that other TV networks may be emboldened by NBCU’s move, with a Gartner analyst even speculating that video content may all but disappear from the iTunes service.

News Corp., Time Warner, Viacom and Walt Disney Co. all have contracts with iTunes. One of them is due to expire by the end of this year, and another by next year, according to industry sources, the report adds.

In related news, Apple and partner record labels are to go before the European Commission on 19 and 20 September, to defend accusations of price-fixing across the Eurozone.