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w/e November 25, 2007 SCRI International, Inc © 1984 - 2007
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700MHz Spectrum Auction Could Transform US Mobile Landscape
The FCC auction of the 700MHz frequency band scheduled for January 2008 in the United States could have a profound effect on the landscape of the mobile communications market, according to a new study from ABI Research, by opening the door to a major new mobile operator. It will also be critical in the building of a national public safety communications network in the US.
According to senior analyst Nadine Manjaro, “This auction means an opportunity for the licensing of another major national mobile operator, perhaps one from outside the traditional fold.” Yahoo!, Apple and Google have all been mentioned as potential bidders, but it is Google that should be taken most seriously: they have already stated their willingness to invest $5 billion in the “C” block of spectrum, perhaps in partnership with a network operator, in order to facilitate a more competitive wireless market.
What are the implications for incumbents if a company such as Google enters this market? “If Google becomes an operator, it will intensify the incumbents’ need to compete,” says Manjaro. “Google has content and money, and could do a lot with that spectrum. They’d be a strong force to be reckoned with in terms of taking subscribers from the incumbents, especially from a company such Sprint, which is already facing challenges in this area.”
The 700MHz band is a part of the UHF band (470 – 862MHz) which is being opened in several regions across the globe including Europe in 2010 and in Korea in 2012 as television moves from analog to digital. British regulator OFCOM also plans an auction for the UHF frequency, called the “Digital Dividend.” Regulators are leaning towards spectrum neutrality, which would let the market determine the ideal use of the spectrum, and are also looking to harmonize use of the spectrum. This band is suitable for 4G technologies such as WiMAX and mobile broadcast TV using technologies such as DVB-H.
FCC must rule on ISP P2P traffic control
A distributor of online video content has filed a complaint with the US Federal Communications Commission, asking the agency to stop broadband providers from blocking or slowing P2P traffic.
The petition filed by Vuze, which uses the BitTorrent to distribute Web content, asks the FCC to set rules for network management by ISPs. Vuze's filing follows reports that cable broadband provider Comcast is slowing some P2P traffic, including BitTorrent.
Broadband providers often promote their services as being necessary for watching video online, but then they slow access to a service like Vuze's, said John Fernandes, Vuze's vice president of marketing. "They say that they're engaging in reasonable network management, but what they're doing is slowing down some traffic."
Vuze, which has partnerships with several movie studios, television networks and PC game makers, wants to start a dialogue with ISPs about what kind of network management is allowed, added Gilles BianRosa, the company's CEO. But the FCC needs to prohibit large-scale content blocking, what he called traffic "throttling," he said.
"The ISPs cannot decide unilaterally what to do with third-party Internet services such as us," BianRosa said. "We need to work with them to design a solution that works and is fair."
PPV five year Euro forecast
Research has revealed how the European TV-based video-on-demand and pay-per-view markets will develop over the next five years. From a low penetration of just under 8 per cent today, Screen Digest predict that by 2011 over 20 per cent of Western European households will have true video-on-demand (VoD), a 30 per cent growth on current levels. This growth will generate increased revenues, giving the VoD and pay-per-view (PPV) markets a value of E3 billion by the end of 2011.
While the 'big five' European markets will continue to take the lion's share of on-demand revenues, other countries are beginning to catch up. As more Nordic companies deploy VoD services, the Scandinavian countries are beginning to show increasing on-demand average revenue per unit (ARPU’s). The expansion of the rest of Europe's revenues is also a consequence of the wider availability of the so-called ‘long-tail’ of content. True VoD services typically have a much greater range of local and international programming than their near-video-on-demand counterparts, driving increased spending. It is this which is one of the major factors in allowing Europe's smaller states to close the gap between the big five countries of the UK, Germany, Italy, Spain and France.
The next five years will see the supremacy of sports and major movie content challenged, as other content such as archive and library films and a la carte TV programmes grow their share of total on-demand revenues from 9 per cent to 18 per cent. On top of this, as subscriber numbers and overall on-demand buy rates increase, blockbuster films will benefit from the market growth and will be earning E700 million per year by 2009, despite their loss of market share. The adult industry will also reap rewards, doubling its VoD revenues from its current level of over E250 million to over half a billion Euros by the end of 2011.
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AT&T tight lipped on Echostar
Wall Street rumours about a potential takeover of the second-biggest US satellite operator have abounded, peaking this week with TheStreet.com saying AT&T was preparing a takeover bid worth as much as $26 billion and that both companies have been in talks.
The reports sent Echostar’s share price, depressed by recent disappointing quarterly results, soaring. The stock closed up 27 per cent. Echostar and DirecTV, the largest US satellite operator, have succeeded in taking millions of customers from cable operators in the past decade by offering high-quality multi-channel video and good customer services. Meanwhile, AT&T and Verizon Communications, the second largest US carrier, are both scrambling to roll out their own television and video services, targeting customers who pay $100 or more a month for their multi-channel TV offerings, internet access and landline phone services.
DirecTV restraining order
A temporary restraining order has been placed on DirecTV keeping the satellite giant from bumping HDNet to a different programming tier. The move comes after the HDNet lawsuit which seeks to prohibit DirecTV from moving the all high-def network out of its most widely distributed package.
Hulu includes rivals also
NBC Universal and News Corp, the majority owners of Hulu, are using the online-video site to popularise programmes running on NBC and Fox - but that doesn't mean rival networks CBS and ABC are being shut out.
Searches give an index of available episodes as well as a link to see them on the network's website or on AOL, which runs some ABC and CBS programmes.
By including rival shows in its search capabilities, Hulu intends to develop a name for itself as a place where surfers can find video from shows on any network. Hulu's backers are trying to establish the site as a portal for high-quality video, a la YouTube.
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Adobe and Avid CEOs Depart -- Big Changes
With both of their CEOs leaving, Adobe and Avid are resetting high-level management for the next phase of growth and, perhaps, significant changes in corporate direction. This according to a report by by Tim Siglin at Streaming Media, which follows.
In the world of video postproduction and motion graphics, Adobe and Avid are two of the three major players. Adobe, as well as Apple, also controls a sizeable amount of the streaming and progressive download on the internet, with the companies’ preferred formats making up well over 80% of all web video traffic.
While the longevity of its charismatic leader has always been Apple’s Achilles heel, the company continues strongly, with additional features and enhancements to its products in the high-definition production and delivery space—Final Cut Express 4 was just announced, at a slashed price of $199 even after including support for the AVC-HD H.264 tapeless consumer high-definition video format. Adobe and Avid, however, have both announced major shifts in corporate management.
Adobe, on a roll from its wildly successful Creative Suite 3 launch that firmly integrated Macromedia products such as Dreamweaver and Flash into the Adobe dynamic media tool lineup and continued to integrate products such as Visual Communicator from the Serious Magic acquisition, has recently announced that its CEO, Bruce Chizen, will step down at the end of November. The move has surprised quite a few industry watchers, as Chizen leaves at a point when his company is doing quite well.
"I was a bit shocked at this announcement," said Mike Soucie, CEO of Electric Rain, an Adobe partner, in a recent interview. "Not that he is stepping down, but more of the abruptness of the announcement. If this was planned for a while due to a retirement decision, then I would have expected this type of announcement to be made during a planned analyst or financial call."
Chizen has said publicly that his departure has been planned for at least six months, and those of us who attended Adobe MAX 2007 in Chicago can now look back and see that Shantanu Narayen, then president and COO and now CEO of Adobe, was taking a central role in articulating the ongoing vision. But the company is also at a critical juncture, as it moves into service areas that some of its customers may feel are in direct competition with them. In addition, there are the impending releases of a new Flash Player, Flash Media Server 3, the Adobe Media Player (AMP)—and its myriad outstanding potential privacy and control issues—and the Adobe Integrated Runtime (AIR), which is the umbrella required to bring web-based products to the desktop. In this light, Chizen’s departure is raising concerns that Adobe could stumble as it completes its biggest overhaul since the company bought Aldus in the early 1990s
Avid, the company that has long dominated the non-linear editing pinnacle, is also struggling—in a much more public way—with its grasp on the market and with the effects of its CEO leaving earlier this year. The news that shocked that portion of the industry—and may have some interesting implications for the streaming media space—is Avid’s announcement that it was pulling out of its annual massive display at the 2008 National Association of Broadcasters show.
The mid-2007 departure of long-time CEO, David Krall, who had come to Avid with the company’s acquisition of Digidesign and had given the company a much-needed shot of levity that Digidesign was famous for but Avid sorely lacked, seems to have set the company adrift again. Recurring complaints, eerily similar to the same customer complaints of an arrogant and listless company, re-emerged in late 2007 but had roots in NAB 2006 when Final Cut Studio surged while Avid ignored or belittled the competition.
Whatever the reason, Avid’s November announcement of its decision to forego exhibiting at NAB, along with its announcement that it wouldn’t reveal its plans until February 2008, make the company look like it’s scrambling to return to the halcyon days of innovative, market-leading product announcements.
“Over the past few months, we’ve been collecting data from all of our constituents, and the findings have been clear—we need to connect with users in new ways,” said Graham Sharp, vice president and general manager of Avid’s Video division. “We are always evaluating the most effective ways to build closer relationships with our customers and keep pace with the ever-changing media market.”
An inkling into some of those changes—beyond Avid getting back to a place where customers feel the company will listen to them—might be gleaned from a statement made at the time of Krall’s departure.
“David has been instrumental in transforming Avid Technology’s business—and keeping it at the forefront of the digital media revolution,” said then-Chairman Pamela Lenehan, noting that, via acquisitions like Pinnacle Systems, Krall had been able to “enter the consumer video and audio markets . . . establishing a rich foundation upon which the company can build an even brighter future.”
The market base for these consumer products—and user-generated or social networking products that Avid might wish to pursue as the face of video post-production (and even its profitable news business) changes—is just as likely to choose Apple or Avid for their core tools, especially as these two companies provide compelling product suites that Avid sorely lacks. One thing’s for certain: Early 2008 will prove a pivotal time not just for streaming and video on the web, but also for two major players in what’s being dubbed the Triple A of video postproduction.
DivX Acquires MainConcept AG
DivX, Inc. announced it has acquired MainConcept AG, a leading provider of H.264 and other high-quality video technologies for the broadcast, film, consumer electronics and computer software markets. The acquisition is a stock and cash transaction valued at approximately $22 million with additional payments of up to approximately $6 million upon the achievement by MainConcept of certain product development goals and certain financial milestones during 2008.
MainConcept designs, manufactures and markets a wide range of high-quality video and audio technology based on industry standards. Its key partners include leading software, entertainment and consumer electronics companies. MainConcept’s portfolio of video technologies, including its industry leading H.264 video codec, is expected to extend the DivX® common media language to additional platforms and formats. The combination of DivX and MainConcept is intended to create a company with substantial scale and resources to deliver products and services that offer the consumer a powerful, yet seamless high-quality media experience.
“We are extremely pleased to add MainConcept to the DivX family,” said Kevin Hell, CEO of DivX. “Company founder Markus Moenig, our new Senior Vice President, has worked with a talented team of engineers to build a successful company with award winning next-generation codec technology that is highly complementary to the core DivX licensing business. MainConcept’s H.264 technology is expected to increase our market opportunity and speed our penetration of key emerging product categories, including mobile, HDTV, set-top boxes and digital still cameras. With this combination, we are executing on our strategy to deliver a seamless and simple digital media experience where any piece of content plays back on any kind of device, and formats and codecs are completely transparent to the end-user.”
“This is a great partnership that we believe will prove beneficial to both MainConcept and DivX,” said Markus Moenig, CEO and Founder of MainConcept AG. “Our product suites and business models are highly complementary, and our combined companies offer a rich solution for the creation, distribution and playback of high-quality video across virtually any platform or device. We look forward to bringing these two great teams together.”
“MainConcept is a solid strategic complement to our high gross margin licensing business,” stated Dan Halvorson, DivX Executive Vice President and Chief Financial Officer. “The increased costs related to operations and the integration of MainConcept could impact our fourth quarter by approximately $0.02 to $0.03 per diluted share. We expect this acquisition to be accretive to our quarterly earnings in the second half of 2008.”
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RED releases Redcine and native FCP support
Red Digital Cinema have released Redcine, a software tool to convert native REDCODE footage to any codec you have installed on the system. QuickTime Reference files, link the source REDCODE Raw footage into a QuickTime movie so that applications like Final Cut Pro can use the footage "natively".
REDCODE Raw codec supports RT playback and editing of the QuickTime Reference movies generated in camera. Both 2K and 1K QuickTime Reference movies are supported in this release.
When you transfer media from your CF cards to your hard drive for editing, please be sure you take the Native .R3D files, the QuickTime Reference movies and the Magazine Profile from the CF card. They should all live together in the same folder to allow for offline/online editing and finishing. After you have imported your QuickTime Reference movies into Final Cut Pro do not move the original files to another location. If you move the RED files and media after importing the QuickTime Reference movies into FCP you will lose the connection to the FCP master clips and will have to reconnect the files manually.
Depending on your system configuration, you may see less than full frame rate playback. RED recommends the current top end configuration of a MacPro with 8 cores, fast RAID 0 striped drives and a minimum of 4 gigabytes of RAM if you plan on editing the 2K QuickTime Reference movies. RED recommends for RT editing on a MacBook Pro that you use the 1K QuickTime Reference movies or smaller frame sizes that can be generated with the RED Alert! Program provided to camera owners by RED
Gennum First to Drive 12Gb/s-SDI Over Optical
At InterBee, Gennum Corporation demonstrated the industry’s highest speed, highest performance video transport leveraging its optical technology. The unprecedented signal integrity achieved at 12 gigabits per second (Gb/s) validates the video industry’s ability to move to even higher resolution video formats, to transmit multiple high rate streams across a single optical link and to support emerging high rate standards.
“Just as we did in the early days of SDI, Gennum continues to innovate in order to enable our customers to move to the next level with their video streaming applications,” said Martin Rofheart, Senior Vice President and General Manager, Analog and Mixed Signal Division. “This demonstration highlights the broad possibilities for our video customers to move even higher rates of video through their infrastructure. As important, new and emerging standards such as Ultra-High Definition TV and D-Cinema are now within reach, as these data rates will support the delivery of content that meet the high quality requirements of these and other standards.”
Gennum’s demonstration leverages the company’s leading clock and data recovery (CDR) technology for video optical module applications, which enables the maximum signal integrity at these higher rates to deliver high quality video. The module, a standard off-the-shelf XFP transceiver modified to include Gennum's 12.5G CDR test chip, is capable of variable data rates from 9.9Gb/s to 12.5Gb/s. This variation enables support for a broad range of current and emerging standards, such as UHDTV, Society of Motion Picture and Television Engineers (SMPTE) 435M, D-Cinema, 12-bit 4:4:4 1080p. Additionally, the high bandwidth enables up to eight HD-SDI links or four 3Gb/s-SDI links, creating new possibilities for design of serial routing and distribution equipment.
"We welcome demonstrations of this nature," said Peter Symes, Director, Standards and Engineering, of SMPTE. "We expect to create standards and specifications for motion picture applications at ever higher data rates, and proof of concept is essential to the credibility and focus of the work."
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PEOPLE IN THE NEWS
SeaChange Appointments Chief Marketing Officer
SeaChange announced the appointment of Simon McGrath as Chief Marketing Officer (CMO) reporting to Chairman and CEO Bill Styslinger. McGrath is currently the Director, Strategy and Development at On Demand Group Limited, a subsidiary of SeaChange since September 2005.
A global entertainment and content rights veteran, McGrath has led strategic advertising, marketing, sales and communication initiatives at various global organizations including On Demand Group and Lysis SA, a software company specializing in advanced content management solutions for digital television. Since joining On Demand Group in 2002 as its first Chief Technology Officer, McGrath has played a leading role developing joint ventures that create sustainable market solutions in the implementation of VOD, Subscription Video-On-Demand (SVOD), IPTV and Pay-Per-View (PPV) services. He has been integral in creating video acquisition, advertising and distribution business models for leading companies such as Walt Disney, Sony Pictures, Virgin Media, Telefonica and Kabel Deutschland.
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SD not HD Dominates Recording Formats
According to SCRI's just published "2007 – 2009 HD / Digital Video Trends Report",
recording formats are always a bell weather of trends in our industry. This year we see expected large penetration for SD format, but surprisingly no HD formats reached more than HDV (25.5%), despite the fact that HDV is a relatively new player in the market. HDCAM still has over 21% penetration, with DVCPRO HD slightly lower at about 17%. Neither reached the remaining penetration of Betacam SP (well over 50% of the market still has Betacam SP). Penetration of HDCAM has remained essentially constant since the last Survey. In SD products DV based recorders (DV, DVCPRO, DV CAM, and variants) are present in more than 80% of all facilities.
The 2007 - 2009 HDTV / Digital Trends Report is now available. Data for the report was derived from extensive surveys of broadcast and professional video/film production/post facilities, worldwide.
This years Summary includes very important data which shows that the industry will remain healthy and growing into the future. It shows support for existing standards, and some degree of skepticism about the uptake rates for some emerging technology. Above all it represents a snapshot of the changes which are shaping the hardware and programming in which we are all involved. The US economy has weathered recent storms well, with strong corporate profits. With an election year next year both production facility and broadcast station owners should do well, as is traditional in presidential election years.
The report looked at four major areas of media industry technology:
HD/SD Digital Video Trends
Digital Video IT Infrastructure Trends
Summary data about the survey includes information on respondents, including Media and Video Functions, and Demographics. Approximately 1 out of eight respondents were associated with broadcast licensees, and six out of ten respondents were associated with production of film or commercial production facilities. A follow up question appears to identify most of the broadcast respondents as being related to ENG/EFP operations. 27% were associated with religious organizations, government, corporate facilities, or healthcare.
This extensive 75 page report includes an Executive Summary, followed by an analysis, charts and tables of how the broadcast / professional video marketplace equipment end-users respond to questions on key trends -- click to view table of contents
SCRI RESEARCH NEWS
NEW: 2007-2009 HDTV / Digital Trends Report This extensive 75 page report includes an Executive Summary, followed by an analysis, charts and tables of how the broadcast / professional video marketplace equipment endusers respond to the key HDTV / Digital Video Trends -- click to view table of contents
IPTV / Mobile TV Report: now available, 14 page Executive Summary and Analysis, with over 120 pages of articles and reports from online sources as well as SCRI Insider Reports. Cost is $995, or $695 for current SCRI Insider Report subscribers and clients. Contactdes_chas@scri.com for more info. Broadcast/Pro Video Product Reports. Tracking purchase history (2006), purchase plans (2007 & 2008), brand shares, etc. for each of twenty five specific product types, from Camcorders to VTRs. Broadcast/Pro Video Macro Industry Overview Report. Over 50 pages of analysis and information on the state-of-the-industry compiled from secondary online research sources including industry news sites, manufacturers sites, as well as SCRI's own weekly online News Briefs and Insider Reports. Broadcast/Pro Video Micro Quantitative Product Data Report. 23-page report containing quantitative data tables, for all six verical end-user markets, and all of the 25 Product categories, as well as in total, with summary tables from 2002- 2008.
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