SpeedBit's Incredible Shrinking Download

The Israeli company says its new accelerator can download a film inside 20 minutes. If true, this could revolutionize the online video industry

By Neal Sandler

Downloading a movie or a TV episode over the Internet and watching it in the comfort of your own home may become the next major consumer trend. But even with a high-speed Net connection, a full-length movie clocking in at 1.5 gigabytes still takes hours to buy and download.

Industry analysts concede that this remains the major roadblock preventing online video from catching on as quickly as music did. After all, even compressed movie files are at least 100 times larger than a song. Now an Israeli startup called SpeedBit says it has devised a solution that can dramatically accelerate video downloading over the Net—potentially opening the door to much wider use of the technology.

SpeedBit, based in Herzliya and Haifa, plans to roll out its new video accelerator by Apr. 19. The technology is a work in progress, with constant improvements eked out as the company devises new ways to perk up performance. Already, says co-founder and Chief Technology Officer Idan Feigenbaum, SpeedBit has managed to shrink the download time for a full-length feature to about 40 minutes over a 5 Megabit-per-second (Mbps) Internet connection. At the higher speeds available in some countries, that could be slashed to 20 minutes or less.

A Boon for Internet Video

"Reducing the time to download movies to around 15 minutes will definitely lead to a big upsurge in penetration of the trend," predicts Andrew Hargreaves, an electronics industry analyst at Pacific Crest Securities, a Portland (Ore.) investment bank.

That should also come as welcome news to big companies that have bet on Internet video. Retail giant Wal-Mart (WMT) launched its much-anticipated video download service in February, following the 2006 introduction of videos on Apple's (AAPL) iTunes. Amazon.com (AMZN) and Microsoft's (MSFT) MSN also now offer streaming or downloadable videos.

But Wal-Mart has reported that only 3,000 movies were downloaded in the first month of its service. And though Blockbuster (BBI) looks likely to introduce video downloads by the end of this year, it is already cautioning that the business probably won't take off for another year or two.

Streaming in Multiple Channels

SpeedBit's video accelerator could help ease those growing pains. An early, free version of the product designed to improve delivery of streaming videos from YouTube (GOOG) was rolled out in March, and nearly one million copies already have been downloaded. "Our accelerator deals with the common problems of buffering and freezing and dramatically improves the quality of the viewing experience," says Feigenbaum, a 29-year-old, self-taught computer programmer.

How does it work? Conventional video delivered over the Internet essentially travels in a continuous stream from the source to the destination—that is, from the seller to the customer. (The distributed architecture of the Net and the intervention of content delivery services such as Akamai Technologies (AKAM) mean that the path is actually far more complex than this.) By contrast, SpeedBit uses complex algorithms to optimize available bandwidth—in effect, downloading different chunks of a video simultaneously over multiple Internet connections, rather than in a single stream.

All of this is invisible to both content providers and customers.