The Best of Nxtbook - 8

10SMMJ06 8/23/06 4:54 PM Page 10 Reality Check Editor’s Note headed for
my first ad:tech show in Chicago this July fired up just to the point of
spontaneous combustion. After all, I’m the guy who wrote the call to
action “This Time It’s for Real” in the 2006 Streaming Media
Industry Sourcebook about how this would be the year online video
advertising finally became not just feasible but common and, most
importantly, maybe even profitable. A frenzy of phone calls about new
products and ser vices only fueled the fire. I spent countless hours this
summer taking briefings and watching demos from providers of the latest
and greatest ad insertion tools, broadband TV channels, video search
technology, content publishing systems, and the like. All of which, I must
say, looked every bit as good as their backers promised they would. The
problem, of course, is that all of these conversations and demonstrations
happened inside a vacuum, with little or no consideration for how these
products would perform in the real world or even whether or not they were
getting any actual traction. I’ve little doubt about the former—unlike
ten years ago, the infrastructure and adoption is now in place for
broadband video apps and services to work outside of closed networks.
It’s the latter—the combination of nebulous or nonexistent business
models with end-user wariness born of the dot-com bubble burst that
followed the last proliferation of VC-backed next-gen technologies—that
concerns me. Which brings me back to ad:tech Chicago. A look at the
exhibitor list and session schedule suggested that video would be one of
the conference’s focal points, along with more general,
non-medium-specific advertising and marketing sessions. The highlight
promised to be “TV 2.0,” a session by Peter Storck, former president
of Jupiter Research and current head of research firm Points North Group,
and the eminently quotable new media pundit Tim Hanlon, currently SVP at
Denuo, the futures consulting wing of ad agency Publicis. Hanlon summed up
his feelings about next-generation video platforms in one sentence:
“I’m very sanguine about it.” As for Storck, when asked if he
thought these platfor ms—set-top boxes, broadband TV, handhelds, and
various combinations of the three—offered advertisers real opportunity,
the best he could muster up was “We’re getting there.” Those
aren’t exactly the kinds of pronouncements that inspire people, even
when they’re as predisposed to enthusiasm as is the ad:tech crowd. And,
needless to say, the audience members didn’t exactly whip out their
cells and Blackberries, call their agencies and clients, and shout,
“Forget about those banners! From now on, it’s nothing but in-stream
video ads for us!” 10 STREAMING MEDIA September 2006 i A walk of the
show floor revealed a similar lack of emphasis on video as a component of
the overall ad mix. Even the one major content delivery network that was
there was touting not its video delivery services but its increasingly
popular banner advertising delivery. If ad:tech Chicago is any indication,
interactive advertising and marketing are not quite yet synonymous with
video. Thank goodness Chicago is only a two-hour drive from Streaming
Media’s editorial offices in Madison, I thought. My initial
disappointment, however, gave way to an appreciation for the reality check
ad:tech gave me. It’s easy for those of us inside the streaming
industry— whether content producers, video aggregators, internet radio
stations, or vendors—to get caught up in the rush that comes with
knowing that most of the important pieces are now in place for broadband
business models to succeed. But we’d all do well not to get ahead of
ourselves, lest we get burned That’s why you’ll find that, in the
feature stories in this issue, our enthusiasm for user-generated video,
in-stream video advertising, and multiplatform content delivery is
tempered by a healthy dose of reality. The technical limitations that
halted streaming’s growth at the turn of the centur y are mostly gone,
but only mostly. We’d all do well to remember that, whatever the latest
numbers on broadband penetration happen to be, the vast majority of
consumers still don’t spend hours every day watching video on their
computers. And the solutions and products I’ve seen in the last few
months—broadband TV providers like GoTuit in the U.S. and Zattoo in
Europe that have finally figured out how to do it right, BroadRamp’s
killer multimedia publishing app—do, indeed, hold a tremendous amount of
promise. But we’re not there yet. Consumer attitudes still need to
evolve, and business models need to be fleshed out. “Proceed with
Caution,” the headline of Geoff Daily’s in-depth look at the state of
in-stream video advertising, really says it all. Move forward we must, but
only if we remember what happens when we get too close to the flame. Eric
Schumacher-Rasmussen erics@streamingmedia.com is editor of Streaming By
Eric Schumacher-Rasmussen Media and StreamingMedia.com. Comments? Email us
at letters@streamingmedia.com, or check the masthead for other ways to
contact us. www.streamingmedia.com
The Best of Nxtbook

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