Bracing for impact
An interesting study from Leichtman Research Group suggests perhaps that the sky is not yet falling in relation to traditional ad models…but the girders that are holding it up appear to be weakening ever so slightly.

LRG, in a recent survey of 1,350 households, found that usage of digital video recording and video-on-demand usage is certainly on the rise, but the impact they are having on traditional TV viewing remains relatively minor.

Among those surveyed, the mean reported number of shows recorded weekly in DVR homes (11.3) jumped 23 percent in the past year—all nice candidates for ad-skipping.

The mean number of total on-demand programs ordered per week also gained ground—by 33 percent in the past year—to 4.8 per week, with "premium" shows and movies accounting for about half of all reported on-demand usage. The other half, presumably "free" fare, are, meanwhile, solid candidates for some digitally-inserted, targeted advertising.

But combined DVR and VOD usage represented just 4 percent of all U.S. TV viewing, just 2 percent higher than a year earlier.

But those numbers are only expected to rise. In reporting Q1 figures last week, Comcast Cable noted that revenues driven by on-demand movies and events jumped 29 percent year-over-year. Twenty-eight percent of its digital customers also subscribed to a DVR and/or HDTV service, up 17 percent from the prior year.

Although this all  isn't quite mainstream yet, it will be in just a few years, if forecasts hold up.

LRG estimates that more than 50 million homes will have a DVR by 2010, and 42 million will receive cable-fed VOD.

That leaves some, but not a lot, of time to be ready for this sea change of potential problems…and opportunities. And it appears that everyone is in full prep mode.

Cable, of course, is already moving rapidly with targeted ads.

Nielsen Research is already using or deploying DVR and VOD measurement tools and techniques.

TiVo, meanwhile, just launched an Audience Research and Measurement (ARM) division.

And let's not forget about the two-second ad to counter ad-skipping.

One key message to all this activity: It's a lot easier to dodge a punch that you can see coming. So you might as well set to work on your bobbing and weaving.

— Jeff Baumgartner, Editor in Chief, CED magazine and xOD Capsule

AOL extends video vectors
AOL has spread further into broadband video with the forthcoming launch of a portal that provides access to north of 45 channels, a video search engine, video store and a video sharing platform called "UnCut Video" that shares traits with popular user-generated sites such as YouTube.

Although the beta of the service won’t launch until this Friday, here’s an example of what AOL Video will look like and what it will offer.

The AOL Video portal, which comes on the heels of the company's ad-supported In2TV service, will be offered as a beta starting Friday, Aug. 4. Also, like In2TV, the AOL Video service will use the "DVD-quality" Hi-Q video format developed with Kontiki.

In terms of "channels," the service will feature both paid and ad-supported on-demand fare from more than 45 programmers, including the A&E Networks and MTV Networks stables, National Lampoon, TNT, TV Guide, and Wild America.

The search engine, powered by technology from Truveo and Singingfish, will crawl and incorporate returns from the "most active video sources on the Internet." They include YouTube, Yahoo!, Google Video, iFilm, and AtomFilms. AOL announced its acquisition of Truveo in January 2006.

AOL's video platform will also support Intel Viiv-based PCs. That will enable users to view PC-fed content on their large screen televisions, or other supported devices.

Pillai joins Bresnan
Cable video-on-demand vet Pragash Pillai has officially joined Bresnan Communications as the MSO's vice president of strategic engineering.

Pillai joined Bresnan on July 17

Pillai, most recently the VP of advanced engineering-digital video at Charter Communications, is tasked with helping Purchase, N.Y.-based Bresnan grow and deploy a raft of new services, and head up a service convergence effort that will pave the way for the operator's next generation platform. Presently, Bresnan offers a triple-play of video, data and voice services, the latter via a partnership with Net2Phone.

The move marks an expansion of duties for Pillai, who, at Charter, was a key digital video engineer who helped the operator kick off projects such as digital simulcast and head up a VOD systems migration - and subsequent service expansion -- following the demise of Diva Systems in 2002. Pillai marks the latest high-level engineer to leave Charter recently. In March, the company announced the departure of Chief Technology Officer & Executive Vice President Wayne Davis.

Pillai's first official day at Bresnan was July 17. He reports to Gareth (Gary) McIntosh, Bresnan's senior vice president of engineering.

Pillai's efforts at Charter resulted in several industry accolades. In 2003, he was recognized as the Society of Cable Telecommunications Engineers (SCTE) Young Engineer of the Year. In 2004, CED named him along with colleague Lennie Smith to its inaugural class of "Pacesetters," recognizing him for his role in Charter's first digital simulcast deployment in Long Beach, Calif. More recently, Multichannel News named Pillai to its "40 under 40" list of movers and shakers in the cable industry.

In addition to service convergence, Pillai will also aid Bresnan with its deployment of digital simulcast and growth of VOD services.

Pillai, speaking during a visit last week to a Bresnan system in Montana, said the MSO will strive to be a "fast follower" on the cable technology curve, noting that the company's growth plans offer him "an exciting environment."

Rentrak signs on more programmers, operators
Rentrak Corp. said it has expanded the customer roster for OnDemand Essentials, a service that measures and analyzes VOD usage.

The latest to take the service include four programmers—HealthiNation, here!, Hollywood.com TV and Starz, and three service operators: Midcontinent, Service Electric Cablevision and Verizon.

Rentrak noted that it has also extended a previous deal with Insight Communications.

The company said 32 companies are subscribed to the OnDemand Essentials platform, which reports data on title performance, title audience sharing, and top titles for the week.

Partners, particularly those that provide "free" on-demand fare, are using the data to attract advertising.

Alticast Closes $21M in financing round
Middleware specialist Alticast, which specializes in DVB-MHP and OpenCable OCAP solutions, closed an aggregate investment of $21 million by funds managed or advised by or entities affiliated with AIG Global Investment Group.

The company expects to use the proceeds to increase its market presence in the U.S.; invest in technologies to support the emerging Blu-ray Disc standard; expand its MHP activities throughout Europe; and widen its worldwide IPTV efforts.

The company plans to provide a wide range of end-to-end products and services-all conforming to standards and specs from DVB, CableLabs, Blu-ray Disc Association and ITU-to support cable, satellite and terrestrial television companies.

Alticast, which also makes OCAP (OpenCable Application Platform) middleware, has deployments or integration deals with Time Warner Cable, Pace Micro Technologies, Samsung, Humax, LG, Korea Telecom, and SkyLife, among others.

BellSouth to co-market TiVo DVRs
BellSouth Corp. will use digital video recorders from TiVo Inc. as a carrot to attract new DSL subscribers.

In a co-marketing deal announced Tuesday, BellSouth will promote the stand-alone Series2 DVR in conjunction with its FastAccess DSL service.

The companies have not yet disclosed specific tactics, but noted that they will incent customers who subscribe to both services with "special pricing."

The companies will play up the broadband port of the Series2 DVR, which can be used to obtain content via the Internet, set programs remotely, and to share digital photos and other fare on a home network.

Gotuit sets up ad-based video streaming service
Gotuit Media is taking on the likes of YouTube with its own broadband video portal at its Web site. Gotuit contends its patented search and navigation technology makes loading and buffering so fast that it makes "waiting to watch videos online a thing of the past."

Unlike YouTube, which allows any individual or corporation to make content available, Gotuit.com's library will rely on professional content, broken down into categories including music, news, sports and entertainment.

Content is being sourced via Universal Music, Reuters, Associated Press, AccuWeather, Planet X and others.

The company said viewers can not only easily find the video they want to watch, but can also search for specific points inside a video. As with other media sites, including Rhapsody radio, visitors can customize playlists.

Gotuit expects to subsidize the service with advertisers, which Gotuit believes will be attracted by the ability to target audiences based on their viewing habits.

Recent Deployments

We are making changes and additions (including international deployments) to our
Web-based "living" deployment chart. If you have a new deployment to report for the VOD Scorecard and the Web-based deployment chart, please contact CED Editor Jeff Baumgartner.