Until today, Panasonic’s 103-inch plasma display was the largest flat screen television set in the world. Today, Panasonic announced at CES 2010 that it has broken its own record with a new flat-screen display measuring a whopping 152-inches! I’m scared to think of what this display will cost, and in today’s economic climate the early-adopter crowd has certainly diminished in numbers. Still, this set represents a significant leap forward in flat screen technology. While I’m not yet convinced of the market appetite for at-home 3D content, Panasonic certainly is convinced as their new screen features 3D support as well as 4K by 2K resolution. Along with its massive new screen, Panasonic also announced its first 3D Blu-ray player, the DMP-BDT350. To be clear, 3D content at home will require a lot of new gear, such as a 3D compatible display, a 3D compatible Blu-ray player, 3D content and an A/V Receiver and other equipment that is compatible with the latest HDMI standard, v. 1.4.
Panasonic is clearly leading the charge toward 3D home theater and aims to simplify the upgrade process for consumers. The company announced at CES 2010 that it is bringing its full 3D Full HD Plasma Home Theater to the US market. The 3D FHD system combines a 103-inch Plasma HDTV, a Panasonic Blu-ray player and a pair of special Active Shutter glasses designed to allow viewers to see full HD (1920 x 1080) resolution images.
Panasonic is set to aggressively market the 3D FHD system across the U.S. using branded trucks, as reported by Gizmodo last October. Yet, amidst the barrage of 3D announcements from Panasonic and its competitors, Sony and Samsung, there are some critical perspectives on the challenges facing 3D home theater that make sense. In particular, John Falcone of CNET identifies three specific challenges: lack of 3D content, consumer upgrade fatigue and…the glasses.
As for me, just after Thanksgiving I managed to pick up a Pioneer Kuro PRO-151FD 60″ plasma display at a bargain price. It’s a beauty of a set and I can attest to my own sense of upgrade fatigue. I’ll be watching developments in 3D Home Theater, but I’m standing pat…for a while.
Vevo, the relatively stealthy joint venture between Sony Music Entertainment and Universal Music Group is set to launch on December 8th, according to an email sent to Vevo’s VIP mailing list. Yours truly is on the list and received the following email today:
Dear member of the VEVO VIP pre-launch mailing list,
We are excited to tell you that VEVO will launch the evening of
Tuesday, December 8!!
We’ve been working night and day for months to bring you the best
music video and entertainment experience we can dream up, and in just
about 3 weeks you can see it online for yourself!
The VEVO service at VEVO.com and at YouTube.com will go live in
coordination with our launch event in New York on December 8th. We’ll
be sure to let you know as soon as it’s up and running so you can
start having some fun
We can’t wait to show you what we’ve been working on!
In the meantime, please keep in touch and let us know what you think
about all things VEVO!
[http://go.vevo.com/8] VEVO on Twitter
VEVO on Facebook [http://go.vevo.com/2]
All the best,
Team VEVO
Vevo is expected to be a stand-alone website powered by YouTube and intended to help Sony and Universal monetize their music video properties. Although Vevo’s business model and approach is not well understood, it is often described as Hulu for music videos. Last month, Wired reported that Abu Dhabi Media, an entity owned by the government of Abu Dhabi, invested in the project based on a valuation of $300M. Not many pre-launch digital media ventures merit that sort of valuation. Vevo is surely a venture to watch closely, if for no other reason than it represents another chapter in the ongoing efforts of the major labels to preserve the value of their catalogs online. December 8th will be interesting.
On October 14, 2009, the U.S. District Court for the Southern District of New York granted summary judgment to Verizon in a lawsuit brought by ASCAP. ASCAP’s beef with Verizon focused on the downloading of ringtone files to users purchasing them through Verizon’s website, and the playback of those ringtones each time a subscriber’s phone rings. For the right to sell ringtones, known as a mechanical license, Verizon pays royalties to the owners of the songs. ASCAP wanted to go further, arguing that downloading the song to the subscriber is a public performance requiring a license, and that a public performance license is required to download the ringtone to the subscriber as well as for the playback of the ringtone on the subscriber’s cell phone when a call is received. That’s right, each time your phone rings and plays that snippet by the Black Eyed Peas, ASCAP is entitled to a royalty. Absurd.
In a well organized written opinion surveying recent developments in copyright law, the Court systematically dismantles ASCAP’s arguments. According to the Electronic Frontier Foundation, which filed an amicus brief in the case:
“The ruling is an important victory for consumers, making it clear that playing music in public, when done without any commercial purpose, does not infringe copyright. That’s thanks to Section 110(4) of the Copyright Act, which exempts public performances undertaken “without any purpose of direct or indirect commercial advantage.” In the words of the court, “customers do not play ringtones with any expectation of profit.” This ruling should also protect consumers who roll down their car windows with the radio on, who take a radio to the beach, or who sing “Happy Birthday” to their children in a public park (remember, ASCAP once demanded royalties from Girl Scouts for singing around the camp fire!).”
Earlier this year, Verizon paid ASCAP a $5 million interim license fee. Unless ASCAP foolishly decides to appeal, Verizon’s refund check should be in the mail now.
Wired is reporting that EMI has dropped its lawsuit against Grooveshark, and is licensing its recording and publishing catalogs to Grooveshark. Other terms of the settlement remain undisclosed, but this development represents further evidence that labels are willing to work cooperatively with promising digital music services to generate additional revenue streams. According to Wired, Grooveshark VP of Communications, Isaac Moredock, confirmed the company is focused on signing deals with Sony Warner and Universal, stating:
“We are dead set on signing those agreements with the [remaining] labels to start getting copyright holders and creators of that music paid, because at the end of the day, that’s kind of what it’s all about — making sure the propagators of this art form are actually getting paid,” said Moredock. “We want to effect a legitimate change in the musical landscape, because bands aren’t making that much money anymore, and we want to change that.”
EMI originally sued Grooveshark for copyright infringement in a clear challenge to the business models relied upon by Grooveshark and other companies of not obtaining licenses and requiring content to be removed expeditiously after being notified by the copyright owner. Although recent court decisions, such as Universal v. Veoh , seem to immunize companies whose websites properly warn users not to upload infringing content, there is widespread belief that labels may continue to file lawsuits against companies that knowingly or intentionally attract infringing content. In Universal v. Veoh, Universal argued that Veoh had actual knowledge of infringement because it knew it was hosting an entire category of content-music-that was subject to copyright protection, and that Veoh never had a license from any major music company to display music content and, therefore, knew that all music on its website was unauthorized. Such arguments will likely continue, notwithstanding the following statement in Judge Matz’s summary judgment order:
“UMG nevertheless argues that Veoh is ineligible for the safe harbor because its founders, employees, and investors knew that widespread infringement was occurring on the Veoh system. But even if this were true and undisputed, UMG cites no case holding that a provider’s general awareness of infringement, without more, is enough to preclude application of section 512(c).15 No doubt it is common knowledge that most websites that allow users to contribute material contain infringing items. If such general awareness were enough to raise a “red flag,” the DMCA safe harbor would not serve its purpose of “facilitat[ing] the robust development and world-wide expansion of electronic commerce, communications, research, development, and education in the digital age,” and “balanc[ing] the interests of content owners, on-line and other service providers, and information users in a way that will foster the continued development of electronic commerce and the growth of the Internet.” S. Rep. 105-190, at 1-2 (1998); H.R. Rep. 105-551(II), at 21. See also Perfect 10, Inc. v. Visa Int’l Serv. Ass’n, 494 F.3d 788, 794 n.2 (9th Cir. 2007). Congress explained the need to limit service providers’ liability by noting that “[i]n the ordinary course of their operations service providers must engage in all kinds of acts that expose them to potential copyright infringement liability. . . . [B]y limiting the liability of service providers, the DMCA ensures that the efficiency of the Internet will continue to improve and that the variety and quality of services on the Internet will continue to expand.” S. Rep. 105-190, at 8.”
In the end, it may be less expensive and diplomatically savvy for online music companies to work cooperatively with the labels, up front, to secure licenses and perhaps even financial assistance. As the Grooveshark settlement demonstrates, labels like EMI are open to cooperation and willing to explore new revenue models. As reported by Wired, EMI’s global head of business development, Mark Piibe, stated:
“We think services like Grooveshark offer great music discovery options for fans. In turn, Grooveshark offers a new revenue stream for our artists and will help us learn more about how we can better connect different types of fans with artists.”
I think a new paradigm is in play. Apple’s iTunes business model will face an increasing arrary of challengers, and the labels, at least for now, seem willing to cooperate and even empower the new online challengers.
“Online Monetization That Doesn’t Suck“ With that statement, BigDoor Media today launched a public beta of its new online payment system for online digital publishers. At its core, BigDoor is fundamentally about helping online publishers of games, news, contests, music and other digital media make money in addition to subscription and advertising revenue.
Earlier this year, as reported by TechFlash, BigDoor secured $250,000 in start-up capital to launch BigDoor and its online monetization platform.
BigDoor CEO, Keith Smith, is a serial entrepreneur intent on applying the lessons of his last venture, Zango, an online advertising company. According to Smith:
“Our founding thesis is that current online monetization sucks. Google and the other commercially focused sites shouldn’t be the only ones that have great per-user economics. If online entertainment content is going to thrive, there needs to be an underlying business model that consumers enjoy and that sustains the publishers who are bringing it to market. It is time for the rest of us to get access to the necessary monetization tools that will create real and sustainable business models so that all of us as online consumers can continue to have amazing content, entertaining games, bucket-loads of virtual currency, cool iPhone apps, and great social networks.”
For aspiring entrepreneurs, I highly recommend Smith’s inaugural blog post, “Announcing the BigDoor Declaration of Independence,” an outstanding example of the passion and vision that is so vital in successfully building a company from the ground up.
As further proof of efforts to challenge the iTunes Music Store model of 99¢ per song, Amie Street recently announced it has closed a $3.9 million private placement financing. The financing round was led by Deep Fork Capital, with participation from three unnamed investors. It has also been reported that Amie Street has inked a deal that adds Sony Music’s entire catalog to its online store. Sony’s recordings will sell for 69¢, 99¢, and $1.29 per song. In other words, Sony’s catalog will not be part of Amie Street’s “dynamic pricing” model that increases the price of a particular song the more times it is downloaded.
All this news is significant not only in relation to challenges to Apple’s domination of the digital music space, but also because early stage venture capital financing for technology companies is currently tough to come by. In fact, Down Jones Private Equity Analyst just reported a 70% decline in fund raising for private equity funds in Q3 2009.
Admittedly, the headline of this post is extremely ambitious and could lend itself to a 200+ page book discussing the imapct of Twitter and Facebook on society, sociology, journalism, technology, relationships and more. For now, I’ll just have to publicly draw a vastly more limited and possibly controversial conclusion based on nothing more than recent news stories and a dash of personal experience.
On April 29th, press accounts reported a rather startling statistic. According to Nielson Online, more than 60% of Twitter users abandon the service about a month after joining. According to the same report, Facebook and MySpace have retention rates in the 70% range.
The next day, I read a press story about Facebook’s plan to seek additional private capital, reportedly based on a $5B-$6B valuation. An impressive valuation, particularly when compared with Twitter’s reported pre-money valuation earlier this year of $250M.
Why the disconnect in retention rates? From my personal experience, the Twitter experience is just too fleeting and unsatisfyingly devoid of content. I’m definitely in that 60% of users who’ve practically abandoned Twitter. My followers, all 19 of them, will probably argue that, to the contrary, they have seen many tweets from me, all with a disturbing similarity. In each case, my tweets reported my immediate status to be currently engaged in drinking a bottle of wine. Apparently, I unwittingly left the “publish to Twitter” box checked on my Cellartracker account. Every time I cracked a bottle of the good stuff and updated my cellar logs, my faithful followers received the pointless and concerning update.
My participation in Facebook is quite a different story. I’m sure the reason is the wealth of rich digital content that can be shared on Facebook. Frankly, Facebook delivers a much more satisfying and involved experience. I check it almost daily. I enjoy sharing photos and videos that relate to my life, my family and my friends, and I enjoy seeing what my friends choose to share. The digital content we share with each other makes the experience richer. I am still amazed that 24 years later, through Facebook, I am in touch with so many friends and classmates who attended a tiny American High School in Ankara, Turkey. The connective experience of Facebook is technology used transformatively.
There are more elevated critiques of Twitter available on the Internet than I can muster tonight. One of my favorites bemoans the impact of Twitter on journalism, the growing attention deficit of social networking and the new apps poised to feed the tweet-addicted:
But Twitter is unique and more dangerous because of the rolling, inherently contentless and bite-sized nature of the tweets. It reflects and feeds an autistic culture unable to focus on anything but the tiny feed box in front of it, and even that only when medicated. Programs like TweetDeck (currently in public beta) are working to perfect a permanent desktop scroll and filter—an intravenous Twitter drip.
So, does it come down to the digital content? Is Twitter’s 140 character limitation just enough or not nearly enough? Your humble correspondent suggests its the digital media content. The numbers tell the story in this case. Twitter: 40% retention rate, 7 million unique visitors in February 2009, $250M valuation. Facebook: 70% retention rate, 200 million users, $5B-$6B valuation. It’s gotta be the content!
Last Spring I posted about video search company, Viewdle, which I thought was a company to watch. Well, the folks at Le Web ‘08 think so as well, awarding Viewdle top honors today at the Paris event. Viewdle’s technology uses facial recognition technology to index broadcast and other video streams in real time or faster. At Le Web, Viewdle demonstrated how its technology can be used to index videos of people appearing in videos uploaded to Facebook. Viewdle calls this use of its technology VideoFriends, and you can find it on Facebook here. Think of it as automated tagging for Facebook videos. Once a friend is tagged, VideoFriends will automatically tag that person in any other videos that are uploaded.
VideoFriends seems like a clever way to increase mass adoption of Viewdle’s facial recognition technology, even though it probably generates little or no revenue today. Time will tell if the Facebook experiment will succeed in generating more visibility and exposure for Viewdle. Viewdle is maturing, and remains a company to watch, in my humble opinion.
So its official. Our country is in an economic recession and has been for at least the past year. When times are tough, Americans often seek solace in entertainment. During the Great Depression, many turned to radio, music and cinema to forget their worries. Today, I believe, the economically depressed will likely be turning to video games.
According to Daniel Terdiman of CNET News, while the video game industry will suffer in this recession along with every other industry and is not recession-proof, it will probably weather the economic storm better than most other industries. According to Terdiman:
In the short term, then, there is ample evidence that the video game business may well prove to be stronger than most others. No one is going to do better than companies producing cheap liquor, of course, but in the technology world, it may be tough to identify a sector that could better persevere than video games.
There is data to support Terdiman’s assessment. Sales of video game hardware and software are up, despite the Consumer Confidence Index plunging to an all-time low in October. According to Wedbush Morgan (as reported by the Washington Post), video game sales for November were up 7% over the same period in 2007. Nintendo Co. President, Satoru Iwata, expects steady and increasing demand for its highly successful Wii and DS game systems, and Nintendo’s impressive November sales figures support his statement. Nintendo is so optimistic it has increased production of the Wii video game console from 2.4 million units per month to a higher undisclosed figure. Of course its not all good news. Just today, video game publisher Electronic Arts announced it expects lower revenues in 2009 due to disappointing holiday game sales and confirmed it will cut jobs to stem its losses.
Adding to today’s interesting video game news is Pew/Internet’s report that:
[M]ore than half - 53% - of all American adults play video games of some kind, whether on a computer, on a gaming console, on a cell phone or other handheld device, on a portable gaming device, or online.
Here’s how I see it. Most of these video gaming adults have been video gaming for years. They are not all hard-core gamers. Some dabble, some go in and out of serious gaming, but they all have video gaming experience. If all those adults have to cut back on Vegas trips and Caribbean cruises and look for more economical entertainment alternatives, don’t you think video games will be on their short list? Especially if video gaming leverages the home entertainment equipment they already have? I do, and here’s why.
Video gaming has progressed to an astonishing level of realism, controller technology and community. Games are now routinely published in high-definition to take advantage of your 1080p-capable flat screen. The resolution and clarity of today’s hi-def games are nothing less than stunning. Although this clip is not in hi-def itself, it does allow one to see the incredible things that are possible with today’s gamng technology, and rest assured it does look spectacular in hi-def on a PS3 connected to a plasma TV.
Wireless controller technology is clearly here in a big way. The Wii controller is the obvious popular hit in wireless controller tech, but the PS3’s new Six-Axis Dualshock controller is also an excellent wireless controller and includes pressure sensors that rumble with each action, allowing users to “feel” the action as they play. More than ever, controller technology is pushing the envelope of immersive video game experiences.
The community aspect of gaming is also built into many of today’s games, allowing a single gamer at home to play with or against one or many other gamers via the Internet. The Playstation Network is basically free and boasts 14 million users. All you need is a PS3 and an Internet connection. Xbox Live has just as many users and is free for limited access, and fee-based for its full-access Gold service. Now, the average cost of a new video game title ranges from $40 to $60, so they aren’t exactly being given away. Still, if you buy one title you really enjoy and join an online gaming community, you can get quite a few hours of gaming at an entertainment cost-per-hour that is far less than the price of a single movie ticket. And if you don’t want to buy the game, most are also available to rent from companies like Gamefly (think Netflix for video games). Earlier this year I spent some time (Ok, a considerable amount of time) onlne playing Call of Duty 4: Modern Combat. Take the $50 cost of the game, divide by the number of hours I played, which was, ummm…let’s just say that my per-hour cost of gaming was extremely economical!
Which gaming system is best? Well, this is a flammable topic with strong opinions on every side. If you are a PC gamer, this isn’t really your issue. If you are a console gamer or want to be, then I recommend PC Magazine’s most recent roundup and analysis of the major players in the industry, Nintendo, Sony and Microsoft.
It’s belt-tightening time, and we all need to stretch our entertainment dollar a lot more than usual. A little video gaming may be just what your financial planner ordered. If you’ve already got some hi-def capable gear in the house, then your gaming experience will blow you away. Saving money in high definition has never been so fun or easy. Who knows? Video games may also bring your family closer during these difficult times. At least that’s what Electronic Arts and Hasbro must have been thinking when they created “Family Game Night” for the Wii and Playstation 2:
Join your host Mr. Potato Head as you play classic Hasbro games as well as exciting new versions created for the Wii. Hasbro Family Game Night features family favorites such as CONNECT FOUR, BATTLESHIP, YAHTZEE, BOGGLE, SORRY! and the all new, SORRY! Sliders.
Whether its photos, video or music, all digital media is created by a device and then must be transformed in order to be available to an audience or customers, whether via the Internet, mobile or other online distribution outlets. Content creators have to consider multiple formats, multiple bitrates, digital rights management, watermarking, advertisement insertion, metadata and a whole host of other needs and features that must be addressed before content is truly consumable online. Sounds complicated, right?
This past summer, a new Seattle start-up, RadiantGrid Technologies, LLC was launched to address the complex issues surrounding digital media transformation. It’s Founder and Chief Software Architect, Kirk Marple, was formerly a development manager at WindowsMedia.com, Chief Software Engineer at digital media start-up, RocketVox (which was acquired by thePlatform in 2001), and co-Founder and Chief Software Architect of Agnostic Media, Inc. Clearly, Marple has an ideal background for solving complex digital media problems.
In my humble opinion, a major key to a successful business involves taking a complicated problem and delivering a solution that is simple, cost-effective and easy for customers to adopt and integrate into their existing workflow. An excellent example of such success in the area of digital media publishing and syndication is thePlatform. Similarly, RadiantGrid’s attention is focused tightly on solving the problems of digital media transformation, and describes the company as a “manufacturer and provider of enterprise-class media transformation and workflow software.”
To help explain digital media transformation and workflow, Marple published a blog post earlier this year intended to answer the simple question, what is media transformation? Marple’s post is an excellent introduction to the problem RadiantGrid is solving for its customers. With future blog posts, Marple intends to continue his online discussion of digital media workflow by explaining concepts such as multitrack assembly, stitching of logos, and motion graphic overlays.
RadiantGrid is definitely a company to watch in 2009.
DISCLOSURE: RadiantGrid Technologies, LLC is a client of Stanislaw Ashbaugh, LLP
