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Merrily Down the Stream

Three years ago, video streaming was all the rage. The most enthusiastic supporters of the technology predicted that video streaming to desktop computers

Merrily Down the Stream

Dec 1, 2003 12:00 PM,
By Stephen Porter

Three years ago, video streaming was all the rage. The most enthusiastic supporters of the technology predicted that video streaming to desktop computers would provide stiff competition to broadcast television as a primary source of entertainment for the masses, and companies such as Psuedo and DEN found themselves flush with venture capital as they strove to deliver on that promise.

The dot-com crash swept away such wild speculation, along with most of the companies that were the loudest champions of the cause. But while streaming as an entertainment medium has foundered, streaming technology as a practical tool in a variety of business applications has slowly continued to take root.

According to Mukul Krishna, a senior industry analyst with market research firm Frost and Sullivan, the streaming-media industry generated an estimated $1.5 billion in revenue in 2003, with that total being divided among a wide variety of streaming-related businesses such as video servers, digital asset management systems, content delivery systems, and encoding technologies.

For many people, the term streaming video refers to video delivered over the Internet and often encoded to Microsoft’s Windows Media format, RealNetworks’ Real, or Apple’s QuickTime or to an MPEG-4 format. These formats are more efficient at lower bit rates in order to accommodate a wide range of user connections that can range from 28K modems to broadband.

However, says Joe Mendonca — director of streaming technologies for HB Communications in North Haven, Connecticut — a broader definition would also include video that is delivered within a corporate network on the local area network or on a wide area network. “The formats used within a corporate network range from Windows Media, Real, QuickTime, and MPEG-4 to MPEG-1, MPEG-2, H.320, H.323,” says Mendonca. “We have many more options with this scenario because we have control of the distribution process and over the user connectivity.”

As the head streaming expert for one of the leading system integrators for streaming in the Northeast, Mendonca has seen firsthand the many ways the technology is being put to work. Those that use streaming video include corporations, universities, hospitals, casinos, retail businesses, government agencies, museums, and theme parks. Whether they’re sent over the Web or over internal IP networks, these video streams are being used for presentations, employee training and communication, marketing, customer communication, point-of-sale advertising, distance learning, work group collaboration, and in the case of special venue applications, entertainment.

“The benefits of streaming media are being realized by all types of organizations as the need to communicate critical information to distributed audiences with speed, ease, and convenience accelerates,” says James Dias, vice president of marketing and sales for Sonic Foundry, one of many vendors serving the streaming marketplace. “In addition to lowering costs compared to conventional methods, it’s also quickly becoming a way to gain a competitive advantage. Businesses are increasingly turning to the Web to effectively communicate with large numbers of dispersed people without the time, expense, and hassles of travel. They also are looking for more sophisticated rich-media tools to explain complex products, plans, and programs.”

Peggy Miles, president of Intervox Communications in Alexandria, Virginia, is one of the leading consultants in the streaming industry. She calls the rise of streaming “a natural progression, as more and more companies have A/V departments that are creating content in audio or video for such uses as videoconferences, training sessions, and company-wide announcements. With streaming, these can be shared with others either live or on demand over a network.”

Although market numbers from analysts can vary, there is a consensus that the market for streaming video is growing and that corporations represent one of the biggest market segments for the technology. According to Paul Ritter, an analyst with the Boston-based Yankee Group, nearly 35 percent of all corporations with more than 100 employees use streaming for employee training. Twenty-seven percent use it for marketing and advertising applications, and 25 percent put it to use for training of customers and business partners.

The notion that use of streaming in corporations is on the rise is confirmed in the results of a recent survey conducted by Interactive Media Strategies (IMS), which found that 34 percent of the marketing and sales executives surveyed said they expected their Webcast spending would increase in 2003. Of that group, 20 percent said they expected their budgets for multimedia applications to increase by 50 percent each year.

Interestingly, the report states that the more a company uses Webcasting, the more likely it is that it will increase its spending on multimedia-enriched technologies in the coming year. With streaming, it seems, familiarity makes the heart grow fonder.


In the corporate world, some of the biggest users of streaming are companies in the financial industry. One such user is Ernest and Young, which conducts monthly Webcasts on the company site aimed at clients and target accounts. These hour-long “Thought Center Webcasts” are live productions designed to showcase the company’s leadership on current topics while raising awareness of its services and capabilities. The Webcasts are panel discussions organized in a Meet the Press — type format complete with a moderator and several experts who discuss financial topics relevant to customers such as how to buy and sell businesses during an economic downturn. The Webcasts are presented live but are also archived so customers can watch them on an on-demand basis at their convenience.

In addition to Webcasting, corporations are also heavy consumers of Webconferencing technologies that give them the ability to not only distribute live video to a widely dispersed group of people but to distribute text, slides, graphics, and data, as well. Webcasting is a one-way form of communication, but Webconferencing is two-way and interactive.

One company that has been successful in penetrating the corporate market with Webconferencing solutions is WebEx, a San Jose, California-based company that claims to be the only company that has built a global network over which it runs its communications. Although other Webconferencing companies post meeting data (slides, graphics, and so on) to remote databases, WebEx meetings are run over the company’s own network. The result is an ability to run highly interactive meetings in real time, complete with a two-way video connection. Revenues are generated in much the same way as those of a phone company, either through a per-minute usage fee or a monthly flat fee. Indeed, the company likens the WebEx solution to a telephone, explaining that it provides the ease of use of a phone but with a full range of multimedia communication tools — voice, graphics, text, and video.

WebEx’s 8,000-plus customers include corporations such as Kodak, Lawson, Agilent, and PeopleSoft. One of WebEx’s customers, Fiserv Lending Solutions, uses WebEx to demonstrate its loan origination and processing software to credit unions, mortgage companies, and other potential customers. With WebEx, Fiserv sales reps can not only turn control of the application over to a customer remotely for a demonstration run, but they can open the Web meeting with live video of themselves shot using inexpensive Webcams from their desktop.

“WebEx truly helps differentiate us in the eyes of our customers,” says Dan Welbaum, Fiserv’s senior vice president of sales and marketing. “We just ask them to sign on to our meeting site and give them the URL. They join the meeting, and the presentation begins. Customers love the convenience.”


Webconferencing and Webcasting tools are also used extensively in the educational market for distance learning applications. “We’re getting approximately 50 percent of our customers from the education sector,” says Dias. “Mostly higher education institutions but K-12, as well.”

According to Dias, the factors driving demand for streaming in the education area include a desire to enhance learning, boost enrollment, and reach students beyond the immediate community. There’s also a strong demand for online learning, from both traditional college-age students as well as adult learners balancing jobs and families who want the convenience and flexibility of anytime/anywhere learning.

Among the educational institutions Sonic Foundry is working with are the Charleston Area Medical Center (CAMC) and the West Virginia University School of Nursing, both of which were using a videoconferencing service prior to selecting Sonic Foundry’s Mediasite Live to make the transition to Web-based education and training. Sonic Foundry describes its Mediasite Live product as a real-time, rich-media presentation system that provides all the hardware and software needed to create and deliver high-quality, rich media over the Web.

Mediasite Live works in the background during live presentations to automatically capture the synchronized audio and video and any kind of data output from any presentation device (notebook PC, document camera, smart board, and so on), thus eliminating the need for any special preparation, costly production, or complex authoring.

According to Dias, organizations are discovering that a real-time, Web-based communications system has several benefits compared to videoconferencing. For example, Dias says, Web-based education tends to be less expensive and more convenient in that it offers anytime/anywhere access and makes it easier to capture and reuse content.

The CAMC, says Dias, is using Mediasite Live to make available online accredited continuing-education lectures to physicians, medical students, and allied health professionals. In addition, CAMC’s Health Information Center uses Mediasite Live to create on-demand presentations that consumers can access from the Web to learn more about general health issues.

The West Virginia University School of Nursing uses Mediasite Live to broaden access to its program, a vital requirement in light of the shortage of nurses and nursing educators. Dias says it’s an affordable way to scale up and expand the breadth of the program without adding complex infrastructure or cost centers. By eliminating any pre- and post-production work of publishing a lecture to the Web, Mediasite Live removes the technical and the operational barriers to distance education for both the professors and the university’s IT department. For the students, it provides access to a truly rich-media learning experience that can support the requisite variety of medical imagery when and where it is convenient for them.


Nashville’s Adtec Digital offers a different kind of solution for the streaming marketplace. It manufactures various families of streaming encoders, decoders, and digital video players designed for companies that want to play preproduced program content at a predetermined schedule or on an on-demand basis on a variety of display devices located in close proximity to one another or in scattered locations. In addition, its technology allows users to control external devices like monitors, modulators, switchers, and lighting control systems.

Adtec products are used widely in retail outlets as point-of-sale displays and in casinos, theme parks, cruise ships, and other special venues for marketing, entertainment, and informational purposes.

According to Ron Johnson, Adtec’s vice president of marketing, the company’s offerings have the advantage of being an embedded solution that is easy to set up. “Most people don’t know what equipment to use in order to make a video stream,” he says. “Also, those who know what equipment to use frequently don’t know how to optimize it for the distribution topology they have available. One of our secrets of success has been to manufacture streaming encoders and decoders that can be deployed easily without having to go through a complex configuration process. That is possible because we manufacture an embedded solution as opposed to a server-based solution.”

Often, he says, customers will install their own products, but on highly complex jobs, system integrators usually work closely with Adtec’s staff to set up the systems. Such was the case when a Toys “R” Us store in New York City wanted to install an elaborate A/V display consisting of more than 100 monitors and video screens scattered about the store. New York’s Scharff Weisburg was brought in to handle the integration and installation, and as part of the system, the firm connected an Adtec EDJE MPEG-2 player to the back of every display in the store. Each unit can store several hours of video sent over an internal network from a central control room. The system can run as many as 60 simultaneous video streams to the store’s 100-plus screens.

One particularly versatile vendor in the streaming marketplace is VBrick Systems, which makes a suite of low-cost, brick-size encoders/decoders called VBricks that make it possible to pass TV-quality, even DVD-quality video, over broadband networks to any number of computers, monitors, or television sets. Described as a Swiss Army knife — type of tool for video networking, these MPEG-based video appliances are useful for one-way or interactive live video distribution as well as video-on-demand servers for stored content. VBrick’s products have been used for videoconferencing but also for distance learning, surveillance, security, video management, video-on-demand, and many other applications. The company’s client list includes universities, corporations, the White House, national security agencies, departments of transportation, and investment houses.

One of the company’s most high-profile success stories has been the New York City school system’s use of its technology. Under the direction of the city’s Department of Information Technology and Telecommunications, New York city public schools have implemented a network connecting public schools and museums for distance learning and videoconferencing using VBrick’s video appliances. The network lets schoolchildren take virtual field trips to such places as the Lincoln Arts Center and the American Museum of Natural History without leaving the classroom. It also makes it possible to conduct interactive distance learning between schools and distribute educational TV channels to schools, all over one IP network called I-NET.


While the use of streaming is clearly on the rise, obstacles to growth need to be overcome. Many experts agree that the old obstacle of a lack of networking infrastructure is going away. That opinion was confirmed by the findings of an IMS survey, which stated that of those not deploying multimedia applications on corporate networks, only 11 percent cite lack of infrastructure as the primary factor in their decision. The report also found that only 9 percent cited cost as a reason for not deploying streaming technology.

So what was the biggest obstacle? According to the report, “more than two-thirds of those surveyed simply say that they see ‘no need/no use’ for streaming in their day-to-day activities.”

What that implies is that streaming tool vendors need to do a better job explaining the value of the technology. That value needs to extend beyond simply the cost savings realized from reduced travel.

“The true benefits from streaming deployments can be realized only when vendors and users begin treating online audio and online video as a communications tool,” says the report. “At companies that have already deployed Webcasts, the primary measure of effectiveness does not come from reduced costs. It emanates from an evaluation of whether that application achieves its communications objective.”

Miles sounds a similar theme when talking about what companies need to do to ensure a successful implementation of a streaming solution. “It is sometimes a challenge organizationally to make sure all the departments, divisions, and users are up to speed on how they can contribute to the network as well as use the network,” she says. “There is a learning curve in doing anything new in a corporation. Proper corporate communication is necessary to provide examples of why this is good for the company both from an economic standpoint and a communication standpoint.

“A common mistake is implementing a program without a business plan or a strategic plan of how to use audio and video,” Miles says. “One might want to make sure that the team’s expectations live up to the reality of any program.”

Dias insists there is one other obstacle to growth — streaming tools that are still too complex. Although streaming technology has improved since its earliest days when the creation and delivery of content was too complex and time-consuming for the average communicator, Dias says there is still room for improvement.

“To get broad adoption, vendors need to create simpler tools that don’t compromise the quality or flexibility of the output,” he says.


For those who are ready to take the plunge into streaming, vendors and experts have lots of advice about how to do it successfully. But much of that advice boils down to not underestimating the task’s complexity.

That’s the advice that Geoff Allen, president of Anystream, gives. Based in Sterling, Virginia, the company provides Agility, a turnkey, fully automated solution that automates the content capture and conversion process, from scheduling video acquisition through preprocessing and encoding to distribution to Web and streaming servers. Anystream’s offerings have been well received in the broadcast industry and have begun making inroads into corporate and educational markets, as well.

“We’ve found that many customers underestimated the complexity involved in developing and delivering a good streaming experience for their users,” says Allen. “One of the biggest challenges is in understanding the formats and data rates you need to create in order to make the streaming media available for the widest possible audience. Also, it takes highly specialized knowledge to know how to optimize video for Web-based playback.

“Live Webcasting also presents unique challenges as real-time applications require sustained network bandwidth in order to provide a good experience,” he says. “As audience size can be difficult to gauge, capacity planning is always difficult to predict and plan for.”

So what’s Allen’s advice to those embarking on a streaming adventure? “Clients need to choose their streaming partners wisely and take their technology choices very seriously,” he says. “It can mean the difference between failure and success.”

Mike Savic, director of marketing for VBrick, agrees that implementing a streaming solution can be a tricky business but says, “Usually, it’s not the video but the network,” Savic says. “We find that customers have a wide variety of IP networks using various brands of switchers and routers. The biggest challenge is getting the video to traverse the network reliably 24 hours a day, 7 days a week. We find that the video appliances are extremely reliable and that most problems with the video stem from network congestion, firewalls, or outages.

“If you plan on streaming/networked video in an organization, be sure to get the IT group involved from the start,” Savic says. “By bringing in the IT people early, the streaming/networked video installation will go quickly and easily.”

Mendonca says that early on in the streaming evolution, there was a lot of experimentation to learn the best methods for implementing and delivering streaming media to the desktop. “Today there are many hardware/software products to facilitate the implementation of streaming solutions,” he says. “There are established methods and protocols that are used to properly deliver streaming content to the desktop.

“The largest mistake by organizations is to assume that they can do it on their own,” Mendonca says. “Then they spend the next couple of years experimenting and struggling to achieve the desired results. It is much more cost effective to contract these services to experts that deal with technology day in and day out. The solution gets implemented quickly utilizing the best technological tools available, enabling the organization to achieve its objectives for implementing a streaming solution right away.”

Stephen Porteris a freelance writer who has been covering video, graphics, and digital content creation technologies and applications for more than 15 years. He can be reached through e-mail at[email protected].

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