Opportunity 3: Video Editing

video,editing,Avid,Adobe,Apple,Pinnacle

Lord knows there are many, many choices for video editing software. Most of them follow the "timeline and bins" model popularized by Avid almost 20 years ago. Avid and similar platforms from Apple (Final Cut Pro) and Adobe (Premiere Pro) now dominate professional video and film editing. And, up to the YouTube era, even consumer editing software looked like Avid (Pinnacle Systems, one of the leaders in the consumer business, is actually owned by Avid.) However, there's a dawning recognition that most video editing programs are simply overkill for consumers.

Apple's iMovie 8 and Adobe's Premiere Elements 4, the most recent versions of each company's consumer editing software, have adopted a much simpler user interface. They're both a lot easier to use than previous versions, but they're also much less flexible.

On the other hand, Pinnacle's latest package, Pinnacle 11, has gotten even more sophisticated; the Ultimate version comes with hundreds of special effects, noise reduction, music composition software and even Chroma Key capabilities with an included green screen.

The job of a video editing package, or any tool, is to make it as easy as possible to get the results that you want. Any director or editor will tell you that they actually use a very small number of video transition--fades and cuts--when they're editing. Yet, the sophisticated consumer editing packages have hundreds of transitions (wipes, 2D and 3D effects,) the vast majority of which never get used. They add to the complexity without adding any real value, but they look great on the box.

Pick up a copy of any consumer-oriented video magazine, and you'll see dozens of articles and ads that assume that readers want to be the next Spielberg. but I really don't think that's the goal of most videomakers in the YouTube era. If the continuum runs from Daddy and Mommy wanting to show how cute their new baby is on one end, to the next Steven Soderbergh on the other, most people are somewhere in the middle. They want to entertain and communicate, and they want their videos to look and sound good. For them, the "easy" software (including online services such as Adobe Premiere Express, Eyespot, Flektor, Jumpcut, Kaltura, Motionbox and One True Media) isn't enough and the "complex" software is too much.

Thus, the opportunity that I see is for editing packages that work the way real editors do, with enough functionality to produce good-looking results in a minimum of time, but without all the unnecessary "gingerbread" of the high-end consumer packages. Could someone "de-feature" an editor such as Pinnacle 11, write it in Flash or Java, and make it an online service? At IBC, Forbidden Technologies launched a service called FORscene, which is a step in the right direction, but there's lots of room for innovation.

Opportunity 2: Video Search and Discovery

video,search,discovery,metadata,tags

Video Search and Discovery are two very important, and closely related, functions: Discovery is when you want to find something to watch, and search is when you want to find something specific to watch. When I was writing the report on Internet Video for MRG, I wanted to illustrate the problems with video search, and I decided to do a very simple search, on the word "Panama." There are lots of things containing the word Panama: Panama the country, the Panama Canal, Panama hats, etc., but I was interested in the country and things related to the country.

I started with a text search using the Google engine, and sure enough, the first page of the search was exclusively related to the country and things in the country (including the Canal.) I then did the same search with a variety of video search engines: YouTube, Dabble, Truveo and EveryZing. (After the report went to press, I did the same test with blinkx, and got similar results.)

YouTube and Dabble gave the best results--everything was either related to the country Panama or had been produced in the country. Blinkx returned videos about Panama, the Canal, Panama City, Florida, and three versions of the Van Halen song "Panama." Truveo came up with a seemingly random list of videos with the word "Panama" somewhere in the title, description or tags. And EveryZing was the worst--it relies on speech to text recognition, and it completely misrecognized the speech in the videos it returned. Not one of the videos had anything to do with Panama.

Good video search relies on two components:

1. The metadata (title, description and tags) associated with each video, and
2. What the search engine does with that metadata.

Search engines like Google and Yahoo! have it relatively easy--they can use all the text in a page in order to index the page's content. The more text they've got, the more accurately they can index the page. However, to automatically index videos, you have to rely on the amount and accuracy of the metadata, not the content of the videos themselves. In my experience, search engines like EveryZing that reply primarily or exclusively on speech-to-text recognition simply aren't "ready for prime time."

YouTube gives good (not great) results, because it processes whatever metadata is available with Google's search engine. Dabble gets equally good (some would say better) results because individuals review and tag all the videos, and better metadata means better results.

In my opinion, however, no one has "cracked the code" for video search. This remains an area of tremendous opportunity for at least three companies (the companies that will eventually be bought by Google, Yahoo and Microsoft.)

Discovery is the other side of the coin. It's what you do when you're "channel surfing," or when you're scanning through an Electronic Program Guide (EPG) to find something to watch. EPGs have been around for many years, and they've worked very well. However, as the number of channels increases and Video-on-Demand (VOD) services become more popular, it gets harder and harder to find something to watch with an EPG. Including HD and music channels, many cable, satellite and IPTV systems now have channels into the 900's. How is a viewer going to browse through so many choices?

Companies are working on solutions to make video discovery easier and more intuitive. Hillcrest Labs in the U.S. and Ruwido in Austria have developed custom remote controls and software designed to make it simpler to navigate large libraries of broadcast and VOD content.

At the recent IBC conference in Amsterdam, Orca Interactive of Israel was claiming that "the EPG is dead." They and other companies have licensed collaborative filtering software called ContentWise from Neptuny of Italy. ContentWise both enables viewers to specify the categories and keywords that they're interested in and monitors actual behavior to determine viewers' interests. Then, programming that meets the viewer's interests as determined by ContentWise is offered on-screen, using a "cross-hair" display instead of the typical EPG table of channels and programs.

At IBC, we were assured that ContentWise won't be susceptible to "Amazon disease". If you're an Amazon customer, you know what I'm talking about--you purchased a book for a friend as a gift years ago, but Amazon keep trying to sell you similar books, and there's no way to stop it. The analogue in this case would be if your grandmother came to visit, and watched "Lawrence Welk" reruns on Public Television. Then, ContentWise kept recommending shows with accordion players. Both Neptuny and Orca assured us that viewers can go in and delete shows from their watching history. Nevertheless, I'll believe it when I see it.

As with search, no one has found the "holy grail" of 21st century video discovery yet, and the company (or companies) that do will have a tremendous opportunity to license their technology.

Opportunity 1: Monetization

If there's anything that Internet video sites need to figure out, it's how to make money. Today, it's clear that the way to make money is through advertising, rather than trying to sell access to your content to viewers. You can either persuade viewers to come to your site, or place your content on popular sites where lots of viewers already go.

There are two reasons to distribute video content hither and yon:

1. Drive viewers back to television screens, where they'll watch shows live or on a DVR, or
2. Sell advertising on the video content.

If you're pursuing Scenario #1, all you really need are some bumpers at the beginning and end of the video to let viewers know the name of the show that they're watching, and when they can see it on television. If you're pursuing Scenario #2, however, you've got to accomplish several things:

1. The advertising has to go with the video wherever it goes, and it should be very difficult to separate the two.
2. The advertising should be updatable, so that if the video gets played six months from now, it plays an ad for a campaign that's running then, not a campaign running now.
3. The video should be able to "call home," to provide at least basic information about when and where the ads were seen.

YouTube, VideoEgg and blip.tv have all deployed video advertising systems that can perform these three functions, but all three systems are "closed": Both the videos and the ads have to be served by the same company. VideoEgg and blip.tv are far more hospitable to independent video producers and sites than is YouTube, which really can't be bothered to negotiate with anyone much smaller than, say, Viacom. But, wouldn't it be nice to have a third-party solution that would perform all the needed functions without tying you to a specific video host or advertising network?

At IBC, I ran across a company called Adjustables (www.adjustables.com), with offices in The Netherlands and Sunnyvale, CA. They've come up with a third-party video overlay design tool and ad server that works with both Windows Media and Flash Video files. (A plug-in has to be installed into the Windows Media Player in order to support the Adjustables content.) Their product helps content providers to monetize their video content without locking them into one hosting vendor or ad network.

In short, the monetization opportunity is to provide a platform for producing and distributing in-video advertising that meets the three criteria described above, and that gives the content producer or Internet video site operator the flexibility to choose their own hosting services and ad networks.

The Three Opportunities in Internet Video

I'm taking a few days' break after months of 1) Finishing my report on Internet Video for MRG, 2) Inteviewing dozens of industry executives at IBC, 3) Meeting with IPTV service providers in France, and 4) Completing the fall Market Leaders Report for MRG. During my break, I want to catch you up on some of the industry trends that I've seen.

While I was writing "Internet Video for IPTV Service Providers," I came across three opportunities that are being addressed, but could be addressed far better. Whoever succeeds in solving these problems will be in a position to make a lot of money, through revenues and/or an acquisition. So, here are my "Big Three":

1. Monetization (a big word for advertising)
2. Video Search & Discovery
3. Editing

I'll use the next three entries to discuss each of these opportunities in detail.