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Why Veoh is Having a Big Day


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April 18, 2006

Why Veoh is Having a Big Day

Heather Green

Veoh Networks, the online video startup announced that it raised $12.5 million from funders including Michael Eisner, Spark Capital, Time Warner and existing investor Shelter Capital Partners. And the collective response across the Web seems to be What?

In terms of traffic, Veoh is outstripped by YouTube, so what would make investors pony up? According to Veoh?? founder and CEO, Dmitry Shapiro, it's because Veoh's P2P technology enables independent video makers and Hollywood types alike to dish up longer (movie or TV show length), better quality video online. Where YouTube dominates in the short form, Veoh is looking to be a player in the market for longer videos, Shapiro says. Veoh is free to use, but as producers make money from selling or advertising on their content, Veoh will take a cut of revenues.

So how do we make sense of all these video companies? Shapiro put in his two cents, but would love to get your input, if you have been following any of these.

Brightcove and Maven look like they're aimed at selling a service to established companies and advertisers to create online channels for their content, even allowing them to syndicate the content across other sites.

YouTube, Vimeo, et al are destination sites that combine video sharing and social networking. They started as a way for individuals to share their short videos. But YouTube, at least, is trying to do deals with tradiotional companies as an entertainment hub for distributing short video.

Revver is aimed at working with traditional companies or indie producers as well to commercialize their short form works. Revver inserts code in each video that enables filmakers to track their videos as they are shared, emailed, or IMed, and also to insert ads. Revver takes 1/2 of any revenue the filmmaker makes.

Kontiki, BitTorrent: P2P services that are trying to work with indie and traditional companies. Maybe too proprietary or distrusted by traditional companies to get traction? Still to be seen.

Akamai, Limelight: Content delivery networks that offer a service and charge a bundle for delivering straight bits, but making sure that they do actually get delivered and aren't herky jerky.

Anyone I am missing, totally wrong on any of this?

12:20 PM

digital media

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Heather, here's my 2 cents...

I would classify Veoh as the only one that's truly trying to create what I would consider a real movie/TV studio of the 21st century... one with the potential to advance and disrupt what we all know as traditional Hollywood. From a producers' perspective, if Veoh succeeds, they will become an alternative to the established studios like Disney/ABC, Sony/MGM, Warner, 20th Century Fox, and NBCUniversal. Veoh's focus on long-form storytelling/format is an aspect that Hollywood will appreciate and understand.

By contrast, most of the other video services like YouTube and Revver are essentially popularizing a new art form. These players are re-igniting the popularity of what I would consider "variety show" short-form clips (e.g. SNL clips). But since a lot of the production is user-generated, and production quality is not necessarily a factor, these startups are not going after the core of Hollywood.

As for Brightcove, they seem to be focused on disrupting traditional TV distribution channels (e.g. cable, satellite, and upcoming telco-IPTV). So they're not really going after traditional Hollywood either.

Hope this makes sense. :)

Posted by: Robert Young at April 18, 2006 06:24 PM

You may want to take a look at blip.tv, which is a videoblogging service with quite a following in the tight-knight videoblogging community.

I'm a founder of blip, so I'm a little biased, though.

Yours,

Mike Hudack

CEO, blip.tv

Posted by: Mike Hudack at April 20, 2006 01:37 PM

Hey Mike,

Thanks, I have heard good things about Blip.

Posted by: Heather Green at April 20, 2006 01:59 PM

Well at Ideabloom we are going a different route. We're still under the radar as things get put together. We have located outside Silicon Valley. The main reason, price. It just costs too much to do this type of work in California. It ranks at the top of the list of high cost locations. Why build a new entertainment capital on the landfill of the old one. Especially, when you have to compete against Canada, and India. Of course I don't really want to change anyone elses mind about this. Great Job stay there.

Posted by: Jayson Evans at April 24, 2006 10:13 PM

Very nice piece, and I'm track backing to it. You've identified an important distinction in the online video space. There will be entertaining sites for short clips and big plays (like Veoh) for long-form. What I find most interesting is the new model (like Revver) whereby an amateur with a short viral clip can -- for the first time -- make some money. This is a paradigm shift not just a new website or new channel for Hollywood. Imagine how much money the Numa Numa kid would have earned if Revver was around at that time! -Nalts @ www.willvideoforfood.com

Posted by: Kevin Nalty at May 10, 2006 11:26 AM

I was so impressed with your description of what VEOH is that I just uploaded 50 of our big cat movie clips there. We have been looking for a place to host high quality video of the lions and tigers without the horrific cost that a little non profit cannot afford. I think VEOH is going to do great things for the non profit sector as well by providing us a way to reach our donors.

Posted by: Carole Baskin Founder of Big Cat Rescue at December 30, 2006 01:14 PM

I Have a Veoh and I Love it, it is way better and way morefun than Mypace I mean I am tiffo4295 on veoh and I have Uploaded 9 Videos......so far

Posted by: Tiffany at March 20, 2007 03:56 PM


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