Internet
video. It’s the salvation for content creators everywhere. It’s the end
to dependence on the big bad meanies, the cable and satellite
companies. Right? Hell no. The concept that “over the top” video
creates a valid business alternative for content creators is as
misguided an Internet business myth as there is.
For grins, let’s say you want to start a business for which you want
to stream, live or on demand, any video. Any quality. You want the
ability to reach merely 10k simultaneous viewers. Not a big number. In
fact, it’s a tiny number. It’s certainly not competitive with any form
of traditional TV, but it’s a starting point. So to stream 10k
simultaneous streams, what are your choices ?
Can you just do it from a PC in your dorm room? From your house on
your cable or DSL line? No. You will need an outside vendor in order
to offer a mere 10,000 simultaneous streams. Which leads to the question
of who can provide a service as simple as 10,000 streams ? Who can do it
with any level of reliability ?
The natural response of course would be to say to use YouTube, right? Except that its terms of service prohibit commercial applications.
You can pimp your content and do ad shares, but you cant have control
of your content and its presentation. Its branded YouTube. It’s
controlled by YouTube.
So what are your options ? You have a single option. You have to
use a Content Delivery Network (CDN). CDNs specialize in delivering
content that needs to scale to large numbers, and 10k simultaneous
users, particularly if its sustained for any period of time, like a
cable network would be, is considered a large number.
When Youtube did their big live event, they used a 3rd party CDN.
Any large scale event streamed to thousands or hundreds of thousands
of simultaneous users is going to require hiring and paying a CDN like
Akamai, Limelight or one of just a few others that can offer scaled
streaming.
There in lies the rub. There are only a few CDNs that can offer any
level of scale for delivering video to an audience that is large by
internet standards, but very small by cable or satellite standards. There is not a single CDN that can deliver 2 or more video streams concurrently to more than 1mm simultaneous viewers.
Not one. Anywhere. There are probably 3, maybe 4, that on a perfect
day might be able to deliver a single video stream to 500k simultaneous
viewers.
On the flip side, there are at least 8 large cable and satellite
video distributors that can deliver 100 or more video streams,
concurrently, to a million or more simultaneous viewers.
The Great Internet Video Lie is that the internet opens distribution
to compete with the evil gate keepers, cable and satellite. In
reality, if you have a desire to deliver a large number of streams, and
you want to compete with another internet video provider to offer a
large number of streams, you are not in a very good position. You are
at the mercy of 3 or 4 CDNs, the ultimate internet video gatekeepers
Let me put this another way. Lets say you have your “Worlds Greatest
Concert” that you are sure can draw 500k simultaneous streams (on
demand or live) . Also planning to stream a large event, lets say the
first broadcast of Dark Knight 2, which the producers will stream live
at the same time, and oh my goodness, the remaining Beatles decide to
have their final reunion with a single live concert at the exact same
time. 3 Mega events, each with an expected draw of 500k simultaneous
users. Who has the greatest opportunity and the most leverage ?
That’s easy. Its the CDNs. You have so few choices of vendors that
the CDNs can charge whatever they want to handle the event. And thats
for one single event. You don’t want to know about costs for 24×7
streaming for viewership levels of even small cable networks.
The internet is not an open video platform. Video distribution of
any scale places you at the mercy of just a very few CDNs. You
literally have to compete for timeslots for very large events. If you
want an interesting excercise, call up a CDN and ask them how much it
would cost to support an audience that is never smaller than 10k
simultaneous viewers for a 1mbs stream, 24 hours a day, for 365
consecutive days. Then call up one of the satellite providers and ask
how much they would charge you to deliver to 100pct of their customers,
and then call up a cable company and ask the same question. Total up
the cable and satellite numbers and compare them to the internet costs.
You may be surprised to see which is cheaper.
If you have dreams of competing with traditional TV network viewing
numbers using the Internet, dream on. You cant afford it. You have
been sucker punched by the Great Internet Lie.
