VoIP service company Vonage last week suffered another setback in its patent
litigation with Verizon Communications when a judge entered a permanent
injunction against Vonage using disputed call-handling technology. Vonage
said it had a work-around for the Verizon technology but still faces a $58
million fine and possible other damages.
In my opinion as an observer of high technology companies for 30 years, Vonage
is toast.
If they had a work-around that was easy to implement and had adequate
performance, why did the company wait until now to announce it?
Vonage is scrambling, facing a potential liquidity crisis with convertible
shareholders and may well be forced into bankruptcy. OR it may be forced
into the arms of its opponent, Verizon, which might well covet Vonage’s 2.2
million customers, one of whom is me.
We’ve been here before, the last time being when Verizon took on DSL provider
NorthPoint Communications back in 2000 and 2001. NorthPoint is long gone,
you’ll note. And yes, I was a NorthPoint customer, too.
The biggest issue in the story is this: The days are probably numbered for
almost all VoIP providers that overlay their services atop broadband ISPs.
Net neutrality be damned, the local MSOs are preparing to give priority to their
packets over others in the event of “network congestion.”
On the cable TV side, for example, both Comcast and Time-Warner Cable (probably
other MSO’s as well), are already changing their IP packets to priority bit ‘1′
(default is ‘0′) in their networks (from the Cable Modem Termination System back
to the edge of their network). They aren’t setting their routers to treat
the priority bit ‘1′ to do anything YET, but, when or if they want to give their
own packets preference in cases of congestion on their own networks, it’ll be a
flip of a switch…..
Now let’s look at this in the context of Net Neutrality. For the cable
companies, at least, it probably doesn’t matter. That’s because while
cable Internet service and cable VoIP service both use the CMTS, it is easy for
the cable company to configure its VoIP product as completely separate from its
Internet product. IF YOUR CABLE OPERATOR WILL SELL YOU VOIP SERVICE
WITHOUT INTERNET SERVICE, THEN NET NEUTRALITY DOES NOT APPLY. If excess
Internet traffic causes problems for the VoIP services of these cable companies,
they can prioritize their own VoIP packets with impunity because VoIP isn’t
defined as an Internet service. And for that very reason, packet
prioritization can — and will — occur even if the broadband ISP has signed an
agreement promising net neutrality.
The next level of this ploy is to validate the un-Internetiness of the VoIP
system through public service interconnects like 911. “Should calling the
police get priority treatment?” will be the question and most courts won’t say
“no.”
Even if network congestion requires priority packet handling a small percentage
of the time, it will be enough to nuke Vonage and its direct competitors, though
the potential impact on Skype is less clear.
The only question I am left with is where to transfer my Vonage numbers?
The great challenge of video on the web is how to make it fair for
everyone. Viewers want content that is cheap or free yet retains high
production values. Producers, networks, and movie studios want to be
rewarded by ALL viewings of their works, not just the first one. The ways
we have attempted to resolve these dissonant desires haven’t been very
successful. Viewers sometime illegally copy or share video content.
Producers, networks, and movies studios do all they can to make such sharing and
copying technically difficult and legally perilous. The sad part for the
U.S. is that we have twisted our laws in ways they were never supposed to be
twisted, generally to serve the interests of content creators, which is often
not in service of the public interest as copyright law was intended to be.
Can’t there be a simpler way?
Maybe there is.
Hiro
Media, an Israeli startup, thinks we simply ought to add commercials to TV
shows and movies, thereby changing both the associated business model AND the
balance of power. If shows come with ads attached in such a way that they
can’t be easily removed, then why be opposed to copying and sharing? In
fact copying and sharing should be ENCOURAGED.
The drag, of course, is the ads, which in Hiro’s case are not only difficult to
remove, they are difficult even to skip or fast-forward through, unlike
TiVO. You can fast-forward the show in the Hiro system, but NOT the
commercial. And those commercials change every time the show is
played. If an Internet connection is available at the time of playing, the
ads will even be coordinated with a database and targeted at the interests
of the viewer.
Those who have seen the technology say it is both unique and impressive.
It has been in trials for a year in both Israel and Australia and will shortly
begin trials in the U.S. with NBC on one of their lower profile shows with the
idea of expanding it to their other content. A second test will shortly begin
with Turner Broadcasting, with most of the other major players looking on.
Now if Hiro can only survive the Joost PR blitz.
NeoKast was one of the more talked about technologies at the Video on the Net conference. Frank Huebbers, their Lead web engineer talked about some of the changes that have already happened in the two weeks since we talked to them last.
We at Technology Evangelist have been using MoveDigital’s services for awhile now for our video and podcast distribution. Ed was able to talk to the President of MoveDigital and get into what makes MoveDigital different from other companies that do large file distribution.
Video is great, but the world really still runs on paper, right?
The inventor of the inkjet printer was a guy named Stephen Sears, whom I knew
half a lifetime ago in California. Steve Sears worked at IBM and enjoyed a
small royalty from that early inkjet patent. I have no idea where he is
today, but he must be amazed to see how far his little invention has gone,
thanks to Moore’s Law.
That original inkjet printer, as I recall it, was monochrome and had a print head
with a total of seven or nine nozzles stacked vertically. Maybe you remember those
early printers. They were fast for their time and cheap but of course the
printing was terrible. This week we have announced the logical 21st
century extension of inkjet technology, the Silverbrook Research MemJet printer
featuring a print head that’s as wide as the paper it prints on. We’re
talking 70,400 photolithographed nozzles and 900 MILLION drops-per-second.
This is a $200 printer, remember, that is supposed to use $20 ink cartridges
($0.06 per color page) while printing full color pages at 60 pages-per-minute!
Silverbrook is an R&D company based in Sydney, Australia and run by the
former head of Canon’s Australian R&D operation. They don’t actually
make printers, of course, but license technologies. So we can expect to
see printers very much like this reach the market in another year or so.
While it’s very common to have WiFi available at hotels these days, this is the first time I’ve seen laptop rental as well. At $15 per day, it’s approximately the same price as a simple WiFi connection at some hotels:
This was at the San Jose, CA, Howard Johnson. Have you seen this elsewhere?
It was the final day of the Video on the Net conference and Ed Kohler gave us a quick rundown while running to catch his flight. We talk FireAnt vs iTunes and Democracy as well as Magnify.net and how they enable smaller community driven content into personal videocasting sites.
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Total Run Time 10:22 | Direct Download | Non-Explicit
Ed Kohler’s coverage of the Video on the Net conference continues with todays Podcast. We chat about the trouble with video on the net today, chapters in video, streaming live video via NeoKast and other cool blogging conversations on the floor.
Tomorrow will be the last VON Podcast we do so make sure to join us as we record it live at 9:00pm Eastern, 8:00pm Central on www.talkshoe.com. If you just want to listen to the live stream via your phone or SkypeOut account then simply sign up at talkshoe.com (you’ll need to do this for the passcode) and call 1-724-444-7444 then enter show ID 21423.
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Total Run Time 13:54 | Direct Download | Non-Explicit
Show Notes:
NeoKast - http://www.neokast.com/
NeoKast Intro Video - http://www.technologyevangelist.com/2007/03/neokast_1.html
NeoKast PBS Cringely article - http://www.pbs.org/cringely/pulpit/2007/pulpit_20070315_001831.html
If you’re looking for photos from VON, check the tag VON07 on Flickr. I’m currently watching Scoble and Arrington talking about video on the web. Scoble says the trick to quickly editing web video is to, well, don’t edit it. Problem solved.
Arrington doesn’t think it’s worth the time, or at least hasn’t figured out why it’s worth the time investment for him.
On SEO: both see building a strong brand and creating quality content is the primary way to drive traffic, leading to links, which leads to high search engine rankings.
It’s getting heated. More later.
Diversion Media CEO, Nicholas Butterworth, presented at VON explaining the thinking behind the series of niche video sites his company is creating. The concept is to build video sites in niche markets (first two are travel and snowboarding) using a combination of licensed, created, and user generated video content.
Becoming to the go-to place for video content by niche offers interesting advertising opportunities. Licensing content allows them to seed the site with professionally produced videos.
They play on building out 25 niche video sites using a custom Rails / Flash platform and Amazon S3 hosting & delivery.
The sites generate revenue through a variety of advertising strategies, with Adsense being the primary revenue driver so far. Pre-roll and sponsorships are also used.
Travelistic has 2400+ videos so far, with new content coming online every day. Butterworth doesn’t think they’ve reached critical mass for content yet.
While some sites seem to be focusing on serialized content, including Blip.tv and Brightcove, Diversion Media seems to be closer to the model used by TurnHere in real estate, although Diversion Media takes things a bit further by aggregating licensed content and UGC.
Great concept, but could YouTube aggregate the same content within their site? They have the UGB and have deep pockets for licensing content. I doubt YouTube will start creating their own content, so that’s a differentiator, but it’s probably the most expensive source of content for the site.
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