Insider Reporter

Insider Report

news and views on broadcast and professional video/audio sectors, worldwide

w/e July 1, 2007 SCRI International, Inc © 1984 - 2007


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Blu-ray Winning Over HD DVD

Blu-ray players are in roughly 1.5 million homes -- five times more than its high-def DVD rival, HD-DVD. That's according to the research firm Digital Entertainment Group, as reported by Video Business.

DEG says the 1.5 million Blu-ray homes include about 100,000 standalone Blu-ray players with the rest PlayStation 3 game consoles, which include Blu-ray players inside.

The research firm says there 300,000 HD DVD homes in the United States -- evenly split between standalone players and HD DVD XBox 360 attachment drives.

The DEG findings were reported this week by Warner Bros. senior vice president Steve Nickerson at an industry panel discussion of entertainment executives in Los Angeles. Warner Bros. is currently releasing high-def DVDs in both the Blu-ray and HD DVD formats.

Nickerson said that consumers are preparing to embrace the new high-def DVD category, according to Video Business.

“Between April and mid-December, it was a warm-up, and since Christmas, it has been a very sustained level of business,” said Nickerson. "Really, this year is preparing for further consumer uptake of high-def. It will mirror the year 1999 or 2000 for DVD.”

DEG says consumers have spent $55 million on high-def DVD titles to date, with $35 million on Blu-ray movies and $19 million on HD DVDs.

The high-def DVD format war heated up this week when Blockbuster announced that it would carry Blu-ray titles exclusively in 1,450 stores. (It will keep both formats in 250 test stores.)

The decision has been called a tipping point in the war by some industry analysts who monitor the new high-def DVD category.

During the industry panel discussion, executives expressed hope that high-def DVDs will help the industry keep sales rising despite a recent downturn.

“It’s in the very, very early days of our forecasts, but we believe that High-Definition discs will help return consumer video spending to growth,” said Helen Davis Jayalath, a senior analyst video at the research firm Screen Digest.

Joseph Taylor, a Panasonic executive vice president, says Blu-ray has won the high-def DVD format war against rival HD DVD.

In an interview with TWICE magazine, Taylor noted that four of the eight major film studios have decided to back Blu-ray exclusively. And, perhaps consequently, more titles are available in Blu-ray, leading to higher sales of Blu-ray discs.

"Who did the content providers select? At the moment, overwhelmingly, the content providers have selected Blu-ray," Taylor said. "What are consumers buying? Since the beginning of the year content (disc sales have been) almost two to one for Blu-ray."

Panasonic has been a Blu-ray backer since the launch of the high-def disc format. The company recently introduced a new $599 Blu-ray player.

Taylor said there may be some "noise" yet in the format war with both sides releasing more titles and players. But in the long run, Blu-ray will win, he tells TWICE.

"I'm giving a very politically incorrect answer. I think the battle is over. I think Blu-ray has won," he said.

ATSC receives proposal submissions for mobile, handheld standard

The Advanced Television Systems Committee (ATSC) announced that it has received 10 submissions in response to its request for proposals for its Mobile and Handheld Standard (ATSC-M/H).

The ATSC-M/H Standard will enable delivery of TV content and data to mobile and handheld devices via broadcast DTV signals.

The ATSC’s Technology and Standards Group (TSG) issued the request for proposals May 21, encouraging companies to propose specifications to be used for ATSC-M/H.

The following organizations have submitted preliminary proposals:

  • Coding Technologies
  • Coherent Logix
  • DTS
  • LG Electronics and Harris
  • Mobile DTV Alliance
  • Micronas Semiconductor
  • Nokia
  • Samsung Electronics and Rohde & Schwarz
  • Thomson

    Detailed descriptions for all submitted proposals are due July 6.

    The MPH system from Harris and LG Electronics and the A-VSB system from Samsung Electronics and Rohde & Schwarz were demonstrated at NAB2007. Both share a slice of the 6MHz DTV channel along with a main and multicast SD and/or HD channel.

    FCC Says More Money Needed For DTV

    FCC Chairman Kevin Martin says the agency could do more to educate consumers on the Digital TV transition if Congress would simply approve more funds, according to an article in Broadcasting & Cable magazine.

    On February 17, 2009, all broadcast TV signals in the United States must switch from analog to digital. At that time, Americans will not be able to watch TV unless they subscribe to cable or satellite or get a Digital TV or a digital converter box.

    The federal government and industry companies plan to launch a campaign next year to inform consumers what they need to do to keep watching television.

    But some leading congressional Democrats, such as Reps. John Dingell (D-Michigan) and Ed Markey (D-Massachusetts), say the educational campaign should be sooner and be more aggressive.

    In a letter to Dingell and Markey, Martin laments that Congress has yet to give the FCC $500,000 that the agency requested last year for a Digital TV educational effort. Additionally, he notes, Congress has not acted on the FCC's request this year for another $1.5 million for consumer education.

    Despite the lack of funding, the FCC chief told the lawmakers that the agency was taking several steps to further the transition, including forming an advisory commission of industry officials and drafting letters that congressmen could send to their constituents informing them of the switch to digital.

    He said that the FCC would like to initiate a contract with a news feature service so it could plant stories about the Digital TV transition in publications across the country. However, he said that, too, would require Congress to approve the funds.

    B&C notes that the FCC has also proposed that cable TV operators be forced to deliver a local broadcaster's digital signal in High-Definition rather than being allowed to downconvert it to standard definition.

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    FiOS TV On Uptake

    More than 1 million households and businesses across the country now receive Verizon FiOS service, since the service was launched in August 2004, according to a company release.

    According to the company, about 500,000 customers now have Verizon’s FiOS TV service in their homes. FiOS TV was introduced in September 2005. Both the FiOS Internet and FiOS TV milestones were passed during the second quarter of this year.

    HBO Going All HD

    HBO has announced that it will make all 26 HBO and Cinemax feeds available in High-Definition. The network already transmits some channels in high-def, including the East and West feeds of HBO and Cinemax.

    But HBO says it will begin rolling out the additional high-def feeds later this year with all 26 completed by the end of the second quarter of 2008.

    “We have a long history of firsts in technology – satellite, multiplex and SVOD. Such a commitment reinforces our tradition of giving our customers the best programming when they want it and how they want it. This move further solidifies HBO’s leadership in the premium category," said HBO CEO Bill Nelson.

    Universal Sticks With HD DVD

    Universal's Ken Graffeo says the format war between Blu-ray and HD DVD is good for consumers. Additionally, he says Universal will continue to support the HD DVD format exclusively, the only studio to do so.

    "A little over a year ago, the least expensive HD-DVD player was $799. Now, with Toshiba's current rebate promotion, you can get an HD-DVD player for as little as $299....On the Blu-Ray side, the players started at $1,000 to $1,800 at the end of (2006) and this summer will be down to $599 with new models from Sony and Panasonic. It's the format war that's driving pricing down at such a dramatic, accelerated rate," Graffeo told the Philadelphia Daily News

    Verizon to Carry Si HD

    Si TV has announced it's launching a High-Definition channel in 2008 and telco Verizon has already agreed to carry it.

    Si says it will be the first network targeted to young Spanish-speaking viewers to offer a high-def channel. The network says it's been preparing for the switch to HD since 2004 by producing more than 200 hours of high-def programming.

    "Young Latinos are a huge economic and political force in America today and they deserve -- like every consumer -- the ability to enjoy the benefits of High-Definition television made by and for them," said Michael Schwimmer, CEO of Si TV. "Si TV's audience is a vibrant influence in our country, and it shouldn't have to wait any longer for HDTV now that it's become mainstream fare."

    Verizon says its FiOS TV service, which is now available in 10 states, will likely carry Si HD at launch. The companies did not release specific launch dates.

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    Optibase IPTV at Vancouver Airport

    Optibase has installed its H.264 IPTV solution in Vancouver International Airport. The MGW platforms will be used to stream TV channels and airport announcements to plasmas located throughout the airport terminals.

    Vancouver International Airport, which expects to serve 17.5 million passengers this year, selected Optibase’s streaming solution to enhance its travelers’ experience in the airport. Optibase’s carrier-grade MGW platforms allows the airport to stream high quality H.264/MPEG-4 video at low bit rates to multiple locations using the airport’s IP network. “We are very pleased to be selected for this project,” said Adam Schadle, president of Optibase Inc. “The Vancouver Airport project is a testament to the versatility of Optibase’s MGW product line. In fact, the flexible design of the platforms offers a perfect fit in both Telco and enterprise environments.”

    “With a growing numbers of passengers expected this year and beyond, we are always on the lookout for new ways to make their travel experience more pleasant. The large flat screen displays present a wonderful opportunity to do so, however, high quality video is required,” said Kevin Molloy, Vice President, Simplified Passenger Travel & Chief Information Officer at Vancouver International Airport, “Optibase was the obvious selection to achieve this goal. Their advanced IPTV platforms deliver broadcast quality video, enabling us to continue to expand and adapt to meet the needs of our travelers.”

    ProSieben buys SBS

    German broadcaster ProSieben.1 hast bought rival SBS Broadcasting for E3.3bn. The combination of ProSiebenSat.1 and SBS, both majority-owned by private equity firms KKR and Permira, will create a pan-European rival to RTL Group, owned by German media group Bertelsmann.

    ProSiebenSat.1 said the purchase would be financed entirely with new syndicated loans from a group of banks. The transaction was not subject to approval by antitrust or media regulators and the share purchase agreement would be completed by the beginning of July.

    SBS posted sales of more than E1bn last year and earnings before interest, taxes, depreciation and amortisation of E207m. It was bought by Permira and KKR in 2005 for $2.5bn.

    The new group would be Europe’s second-biggest television provider, active in 13 European countries and owning assets including 24 free TV stations, 24 pay TV stations and 22 radio networks, ProSiebenSat.1 said. Revenues would increase by 48 per cent, to E3.1bn from E2.1bn, and ebitda would rise 43 per cent to E691m from E484m, it added. The new group would retain the name ProSiebenSat.1 Media and be headquartered in Munich

    LG Electronics & Harris Submit MPH(TM) for ATSC's Mobile Standard

    LG Electronics Inc. and Harris Corporation, joint developers of the Mobile-Pedestrian Handheld (MPH(TM)) in-band mobile digital television system, submitted a proposal to the Advanced Television Systems Committee (ATSC) for a standard that would enable broadcasters to provide high-quality digital television (DTV) signals to a wide range of mobile and portable devices. The ATSC is an international, non-profit organization developing voluntary standards for digital television systems.

    The broadcast and consumer electronics industries have identified mobile and handheld DTV as important new opportunities for the future of local broadcasting - providing new revenue streams for device manufacturers and broadcasters, and new services to customers. These new mobile and handheld services, using ATSC-compatible broadcast transmissions, can help spur the adoption of handheld devices by consumers who want value-added services that are currently not available through regular broadcast TV delivery models. With MPH(TM), consumers can view their favorite programs from local broadcasters, watch movies and sports, check local news and weather information and access pay services - even when traveling in fast-moving vehicles or using handheld video devices away from home.

    Developed by Harris Corporation and LG Electronics Inc. and its U.S. research subsidiary, Zenith, the MPH(TM) in-band mobile DTV system provides robust DTV signals to mobile, pedestrian and handheld devices. Harris, a known leader of television transmission systems, and LG Electronics, a leading developer of receiver systems and DTV standards, designed MPH(TM) to be fully compatible with the ATSC A/110 standard for distributed transmission. As such, the system provides a highly compatible, commercially deployable system that has already been accomplished, tested and demonstrated. LG Electronics, Harris Corporation Submit MPH(TM) In-Band Mobile DTV Technology for ATSC's Mobile Standard Until now, reliable reception of signals transmitted by terrestrial broadcasters has not been possible in fast-moving vehicles or pedestrian handheld devices such as mobile phones or laptop computers. Unlike the cellular-based approach, MPH(TM) technology uses only the single, existing transmitter from commercial and public broadcasters. For broadcasters, this new technology enables new and potentially lucrative revenue streams.

    "We share the ATSC's enthusiasm for this promising new technology, which we believe will enhance and complete the digital television experience for consumers and broadcasters alike."

    "In light of the sense of urgency surrounding this next generation of DTV technology, Harris and LG look forward to participating in the ATSC mobile DTV process while continuing to work with broadcasters and other stakeholders to develop a robust, mobile terrestrial DTV market," said Tim Thorsteinson, president of the Harris Broadcast Communications Division. "The MPH(TM) system strikes the right balance for broadcasters looking to deliver both high- definition programming to fixed receivers and programming and datacasting to mobile and handheld devices."

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    IPTV Service Monitoring Solution

    Brix Networks, a global provider of converged service assurance solutions, announced new capabilities for its BrixVision™ Internet Protocol television (IPTV) portfolio that allow service providers and cable companies offering next-generation video services to continuously monitor live broadcast video streams and safeguard content quality in real time.

    BrixVision Live Monitoring provides 24x7, in-network visibility into service quality by monitoring and analyzing live video streams at critical service demarcation points (demarcs) within the delivery network, such as head ends, regional hubs, and local video serving offices.

    Strategically deployed Brix System measurement sources monitor video streams for user-impacting impairments in the video content and those introduced by the network during transmission to the set-top box (STB), allowing providers to effectively segment their networks and pinpoint where problems are occurring.

    Unlike lab or pre-deployment tools, BrixVision Live Monitoring is designed for large-scale, live IPTV deployments. Based on the BrixWorx™ centralized correlation and analysis software engine, BrixVision Live Monitoring provides crucial operational features, including carrier-class scalability, remote management, centralized configuration, data storage, and advanced analytics and reporting.

    JVC Unveils 4 1080p LCD HDTVs

    JVC introduced four new 1080p LCD High-Definition TVs, ranging in size from 37 to 47 inches, according to an article by TWICE magazine. The publication reports that the JVC 688 series, which will ship to stores this month, includes a 37-inch set (model: LT-37X688) with a suggested retail price of $1,599. The 42-inch JVC LT-42X688 will retail for $1,999.

    JVC next month will ship a higher level 788 series, which includes a 42-inch (model: LT-42X788) for $2,099 and a 47-inch set (model: LT-47X788) for $2,699.

    TWICE writes that the 788 series will offer a higher contrast ratio, faster response time and a wider viewing angle. Some LCD sets require viewers to be closer to the center of the screen to fully appreciate the high-def picture.

    The four sets will also include two HDMI v1.3 inputs which is the latest cable connection for 1080p sources.

    Pinnacle's new Studio 11 Ultimate -- Beta Testers Sought

    An email from Pinnacle:

    Want to test all the pro features like AVCD, Vista support; one-click web publishing; super audio scrubbing; Hollywood effects ...without the pro price tag?

    If you thought those features and more were out of folks reach you obviously haven't heard of Pinnacle's new Studio 11 Ultimate!

    We jammed a truckload of features, capabilities, enhancements into Studio 11 Ultimate...and we made it easier to use.

    Your folks won't need a high-priced post production facility but for less than $130 they will swear to gawd they've got it all !!!

    That's right...more effects...more source tracks...more transitions...more title options...more depth...and more ease of use.

    Pinnacle Studio 11 Ultimate isn't much...just a complete production facility in a box!

    And the best news? It's completely ready for you to review.

    Just hit the reply arrow...BAM!!! we'll get you everything including a demo video and reviewer's guide that spells out why Pinnacle is #1 !!!!

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    Avid Adds John Park to Board of Directors

    Avid Technology announced that the board of directors of the company voted to expand the size of the board to eight directors and elected John H. Park as a Class I director of the company with a term expiring at the company’s 2009 Annual Meeting of Stockholders. Mr. Park is a Partner of Blum Capital and shares responsibility for approximately $3.6 billion of assets under management. Prior to joining Blum Capital, Mr. Park spent 11 years with Columbia Wanger Asset Management, L.P. where he was a Partner and the Portfolio Manager of the $900 million Columbia Acorn Select Fund and a Co-Portfolio Manager of the $12 billion Columbia Acorn Fund. In addition, Mr. Park was Director of Domestic Equity Research. Mr. Park received his B.A. and MBA from the University of Chicago. In addition, he holds a Chartered Financial Analyst (CFA) designation.

    “We are pleased to welcome John to our board,” said David Krall, Avid’s president and chief executive officer. “John has a strong business background, working with a broad portfolio of companies to guide them during phases of businesses expansion. As Avid executes its plans for future growth, we’re looking forward to tapping John’s financial and operational insights.”

    Harmonic Appoints Harold Covert to Board of Directors

    Harmonic Inc. announced that Harold Covert, 60, a highly experienced Silicon Valley financial executive, has been appointed to the Company’s Board of Directors and as Chairman of its Audit Committee. Mr. Covert fills the vacancy created by the recent retirement of Michel Vaillaud, 75, who served on Harmonic’s Board since 1997.

    Mr. Covert is currently Executive Vice President and Chief Financial Officer of Openwave Systems and has served in that capacity since 2005. Prior to Openwave, Mr. Covert was Chief Financial Officer at Extreme Networks and Silicon Graphics, as well as at Adobe Systems. He is also a Director and Chairman of the Audit Committee of JDSU. He holds a BS degree in Business Administration from Lake Erie College and an MBA degree from Cleveland State University and is also a Certified Public Accountant.

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    IPTV is Rapidly Emerging as a New TV Platform

    Internet Protocol television (IPTV) is rapidly emerging as a new TV platform. Delivered over broadband, it promises to re-energize the telco business model and disrupt the traditional TV business. The technology leverages the flexibility and scalability of IP to transform the television experience by providing access to more content—content that is superior in quality and can be more personalized and interactive than traditional broadcast TV. Within this context, video on demand (VoD), by enabling further service differentiation, is becoming a key component of the IPTV proposition.

    IPTV and VoD services are as uncertain as they are tantalizing, however. The TV business is complex and largely new territory for telcos; the jury is still out on the commercial viability of IPTV and VoD services.

    VoD services over IPTV networks don’t promise direct returns in the medium term, but they will contribute to customer retention efforts. With new movies representing the most popular and costly VoD assets, IPTV players pay almost all revenue back to the studios and can hardly achieve any profits from VoD transactions. Initially, VoD should be about customer retention. TV is an essential component of a triple or a quadruple play, and VoD can help differentiate a telco’s IPTV service. There is little evidence, however, to suggest that TV carries more weight than the other services. Simply put, exclusive, premium VoD content cannot compensate for deficient voice and broadband offerings. Yet VoD is a necessary evil for IPTV operators. For some, it is a way to differentiate themselves from satellite DTH carriers; for others, it is about matching competitors’ pay-TV offerings. It is also a way to convince consumers to pay for TV.

    IPTV VoD models should be more lucrative as customer bases grow over the next five years. Shorter release windows for content will play a significant role in the evolution of the model, but more importantly, by developing a multi-platform presence for their VoD content, IPTV operators will build larger audiences and grow profits. When IPTV VoD reaches an acceptable scale, we expect that telcos will have more negotiating power with the studios and more opportunities with advertisers.

    Ultimately, to make up for declines in wireline voice revenues and stay relevant, telcos should invest in building a robust content business. VoD is a key component of that strategy. With consumers increasingly demanding access to content anytime, anywhere, and on any device, telcos have an opportunity to build fully integrated multi-platform VoD services that can be accessed from TVs, PCs, and mobile devices. Most telcos have access to large amounts of funds to make sure that they can put together differentiated content offerings. For example, France Telecom has already created ’mobisodes’ and special highlights for its VoD content for mobile devices, as well as trailers, previews, and exclusive interviews for the PC. Indeed, France Telecom reported revenue of €400m from content services in 2006, including sales of VoD, music downloads, and games. The operator has experienced unprecedented growth in its content business; it had originally planned to achieve that level of content revenue by 2008, and expected VoD to generate 22% of the total. Without a content business that can readily respond to the rapidly changing patterns of media distribution and consumption, IPTV players risk becoming dumb pipes as over-the-top providers bypass them and reach consumers directly.

    Developing a multi-platform offering will take time, largely because of copyright and licensing issues. While telcos such as Telefónica, Verizon, and France Telecom are already pursuing the multi-platform opportunity, they still have to license content for each platform separately. Having content that’s licensed for an IPTV VoD platform does not mean that it can also be distributed over a mobile platform. Indeed, telcos have reportedly found the content sourcing process to be more complex and time-consuming than anticipated. Content providers are interested in extending their reach, but they are also concerned about disrupting established advertising models as well as about piracy.

    IPTV / Mobile Video Survey Shows Boom Ahead

    A new survey of telecommunications professionals reveals that mobile video and IPTV will drive significant growth in the telecom industry in the year ahead. Faster-than-expected growth will translate into increased capital spending in the second half of this year, as service providers converge their wireless and wireline networks and launch advanced video services, survey respondents said.

    The survey of 678 telecom industry professionals, conducted by Tellabs(R) and Telephony magazine, tracked respondents' views on emerging market trends, the industry outlook and convergence issues -- indicating an emerging consensus on how quickly mobile video and IPTV will drive industry growth. Both service provider and equipment vendor respondents expect significant growth, but service providers are even more bullish than vendors.

    The sur

    vey reveals that telecommunications professionals:

  • See mobile video happening now -- More than 54% say mobile video is driving growth now or will within one year. Carrier respondents are much more optimistic -- 64% agree, compared with only 51% of vendors;
  • Anticipate IPTV will drive significant growth -- 78% of respondents see IPTV driving significant growth within three years;
  • Expect infrastructure spending to increase
  • A remarkable 96% of respondents expect service providers to increase infrastructure spending in the second half of 2007. But buyers are far more optimistic than sellers, with 47% of service providers expecting a capital spending increase of 8% to 10% or more, versus only 31% of vendors;
  • 51% of respondents see the convergence of wireless and wireline networks happening within two years -- sooner than expected.

    "The survey confirms that users are driving the release of new video services such as mobile video and IPTV, and service providers will invest to meet that demand," said Steve McCarthy, Tellabs executive vice president, global sales and service. "Tellabs solutions enable service providers to rapidly gear up for demand and to meet users' high expectations for video services."

    The Tellabs(R) survey polled industry professionals at NXTcomm 2007, the premier industry venue co-owned by the Telecommunications Industry Association (TIA) and the United States Telecom Association (US Telecom).

    36 Percent In U.S. Will Have HD By 2008

    The Consumer Electronics Association forecasts that 16 million High-Definition TVs will be sold this year, bringing the total number sold in the U.S. to 52.5 million.

    The CE trade group adds that 30 percent of U.S. households now have a high-def set, but that number will likely rise to 36 percent by year's end.

    The CEA says nearly one-third of HDTV households own more than one high-def set.

    According to the CEA, only 44 percent of high-def owners now receive HD programming from a subscription service or over-the-air via an antenna. The rest are using their HDTVs to improve their DVD and gaming experiences.

    “Consumers are satisfied overall with HDTV,” said CEA Director of Research Joe Bates. “But our studies indicate continued education is necessary to ensure consumers truly understand how to receive the full HD experience.”

    Sixty-six percent of HDTV owners who get high-def programming get it through a cable TV service. Twenty-seven percent get it via a satellite TV subscription while eight percent receive it via an antenna.

    Three percent said they watch high-def on "fiber optic" service while another three percent said they get it on the Net. (Some high-def owners have more than one source for their programming, which is why the numbers surpass 100 percent.)

    Streaming Media Ads Forecast at $1.4 Bil. in '07

    Streaming media (audio and video) advertising is on course to deliver a $1.37 billion market in 2007, up 38% over 2006, according to the latest industry wide analysis report published by AccuStream iMedia Research.

    The research report, Streaming Media Advertising 2003 - 2008: Market Spend by Avail, Brand and Content Category, breaks down the multiple revenue components driving growth for the period 2003 - 2008, both by video category (including UGV) and Internet music radio.

    The research report rates, prices and quantifies avails, including pre roll video, in stream video, audio gateways, audio in stream, embedded ad units, in game video impressions, CPC and more by year.

    AccuStream estimates inventory of 1.4 - 1.6 billion pre roll avails being sold against 2.1 - 2.7 billion streams/progressive download views per month inside professional, ad supported content areas (excluding UGV).

    Pre roll is forecast to make up 26.7% of gross video ad spend in 2007 (excluding pre roll or interstitial units sold against long-form content), and 28.5% in 2008.

    By contrast, embedded or in-page placements make up an estimated 58.8% of gross billings in 2007, and forecast at 55.9% in 2008.

    Based on demand indicators, including high sell out rates, rich CPMs and trained cross-platform sales teams, inventory sold against long-form TV shows published by major networks will grow substantially through 2008.

    In game video ads are forecast to grow faster than the overall market. UGV is expected to generate noteworthy ad dollars, particularly from embedded video placements, but continued hesitation on the part of brands and agencies to tackle the chaos of the category suggests incremental steps toward mainstream exploitation.

    CPC (cost per interactive click) applications which enable screen over lays and or crawls are being deployed and finding some traction, and could become regular features on larger aggregated catalog sites such as, music video sites and premium content sites published by the networks.