Earlier this week I had the chance to sit down and meet with a few members of the Brightcove team, including founder and CEO Jeremy Allaire. We discussed the direction that online video was taking and the stratification seen between consumer and professional markets. And perhaps most interestingly, Allaire was willing to discuss the failures that Brightcove (and the online video space as a whole) has had to grapple with.
Since its launch in 2005 Brightcove has accrued customers spanning television, print media, and the music industry, who use the service to manage their online video content. The company has also seen a rapidly growing base of customers from more unlikely verticals, including biotech the pharmaceutical industry. And the service has seen explosive growth abroad, with foreign markets now accounting for 20% of the company’s revenues after only one year.
But despite the company’s success, there is still widespread confusion as to what Brightcove and other video platforms actually do. For years, many people have lumped services like Brightcove alongside consumer portals like YouTube and Metacafe, but the two represent entirely different markets.
In reality these services have little in common besides a Flash-based movie player. Brightcove and its competitors offer a cloud-based software service that caters to the professional market, essentially allowing companies to outsource their online video component. This extends beyond just a media player – Brightcove also manages advertising analytics, ensures that content is properly “plugged in” to the rest of each customer’s site, and offers a set of content management and programming tools. Conversely, YouTube et al. are geared towards amateurs looking for a place to easily put their content on the web.
Much of the confusion stems from semantics – both sets of services could be called “video platforms”. That said, Brightcove is also partially responsible for the confusion, as it actually did used to offer a YouTube-esque consumer site called Brightcove.TV that was put on the backburner in late 2007. The company has since shifted its full attention to its B2B offering.
While Brightcove has seen more than its share of success, underperformers like Brightcove.TV have made it clear that online video may not developed exactly as the company hoped it would. When the market first began to take off, there was a widespread belief that millions of prospective amateur content creators would be able to monetize their videos, driving a massive stream of long tail revenue. Allaire says that this has largely failed to materialize – while there have been some successful video creators, the concept of a long tail video market simply hasn’t become a viable business.
Another area where online video distribution is largely failing is in the transition from the computer to the television. Allaire explains that he envisions a “democratization of video” that hasn’t happened, largely because of proprietary formats and licensing issues that have plagued the industry. Because there is little Brightcove can do to address the issue, Allarie has written an open letter to the consumer electronics industry, but it’s unlikely we’ll see the open standards we all long for any time soon.
Finally, Allaire acknowledged that the idea of for-pay online content has been largely a failure (though he says this is less of a disappointment). Brightcove invested heavily in producing a platform for paid media content, but the market for this hasn’t materialized. He says that even well received marketplaces like Apple’s iTunes TV and Movie stores have seen disappointing results, and we probably won’t see a wider adoption until the consumer electronics industry breaks down the aforementioned barriers.
Over the next few months, Brightcove will be rolling out its gutted and rebuilt third revision to the public (the new version is currently in a private beta). From there, Allaire predicts that the site will continue to make inroads internationally and with with less “conventional” media creators as more companies turn to video platforms to handle even occasional content posts. Other players in the video platform space include Maven Networks, Move Networks, Delve Networks, and Ooyala.