A billion dollar opportunity with video

Published
by
Elias Bizannes
on February 22, 2010
in Internet, Open standards and Trends
. 0 Comments

When Google made an offer for On2, I was dumbfounded. I wrote to a friend working at Google the following:

Phat. But I'm confused. How does Google benefit by making the codec free? I understand Google's open culture, but for 100million, really? They help the world, but what's the incentive for Google? (Other than of course, controlling it).

The reply: "incentive = greater adoption of HTML 5 = apps are written for HTML 5 = apps can be monetized using Adsense".

Interesting perspective from a smart Googler who had no real insider information. But no cigar.

Newsteevee posted a follow up article today on what Google is going to do with this technology, quoting the Free Software Foundation. What really made me get thinking was this (emphasis mine:

Google’s Open Source Programs Manager Chris DiBona had previously argued that Ogg Theora would need codec quality and encoding efficiency improvements before a site as big as YouTube could use it as its default video codec. The FSF now writes in its letter that it never agreed with these positions, but that Google must have faith in VP8 being a better codec if it invested its money in it (Google spent a total of about $133 million on ON2).

The open source advocacy group apparently realized that Google wouldn’t switch codecs from one day to another, which is why it suggests a number of smaller steps to make VP8 mainstream. “You could interest users with HD videos in free formats, for example, or aggressively invite users to upgrade their browsers (instead of upgrading Flash),” the letter reads, adding that this would eventually lead to users not bothering to install Flash on their computers.

Think about that for a second: video on the web finally becomes free for real and open, becoming a core infrastructure to the online world - but the default is crappy. Don't like crappy? Well Mr and Ms consumer, if you want High Definition, you need to pay for a subscription to a premium codec by the already dominate Adobe or another rising star. Assuming you get the whole word watching video and only 1% convert - holy crap, isn't that a brilliant business model?

Bono, the lead singer of the band U2 wrote in an op-ed piece in the New York Times the following recently:

The only thing protecting the movie and TV industries from the fate that has befallen music and indeed the newspaper business is the size of the files"

Simple but profound insight from the famed entertainer. So with this fairly obvious logic, why isn't the movie industry (backed by Google and Apple) innovating business models in this area? Value comes from scarcity - and quality is the best way of doing it. The reason why box office sales and Blu-ray broke a record in 2009, is because the quality is worth the premium for consumers.

What's the incentive for Google, to answer my own question? The return on investment to be associated with a default open technology that you give the option to upgrade to users, is a billion dollar business waiting to happen. Doing no evil to the world and securing future growth at the same time sounds like a Google business in the making,

Ubiquity – it’s coming

Published
by
Elias Bizannes
on February 17, 2010
in Ubiquity
. 0 Comments

I applied to do a panel to SXSW on a topic I deeply believe in and want the world to get excited about: I call it ubiquity. My topic was rejected because it's too broad a topic (fair point), but with The Startup Bus (that thing llaunched last week), I'm going to make it a live example testing the limits of ubiquity and a barometer of that progress.

Ubiquity relates to some long term trends in our society that are now converging: the fact we can access information and computing resources wherever and whenever we are. We can see it now with the changes to how we get the news. But here is a more dramatic example, as it's the examples - not the rhetoric explaining it - that get me excited.

a) Contact lenses that contain a computer chip in them

b) Wireless electricity: it's happening.

c) Google translate integrated into Google googles

a +b + c = awesome. We're not there yet, but the future of our world is damn exciting.

The Startup Bus

Published
by
Elias Bizannes
on February 11, 2010
in Startupbusbus
. 0 Comments

Well, I guess it's happening now! TechCrunch just wrote about my latest crazy idea which is still only days old in my organisation. It's a bus from San Francisco that travels to Austin with 12 strangers. The catch? Those 12 people need to conceive, build and launch three startups by the time they arrive, to a packed audience of real tech entrepreneurs.

The concept is to put a remarkable amount of constraints (moving bus, strangers, 48 hours, crappy connectivity, sleep deprivation) among a group of smart people (and the people so far asking to join, include people who have built million dollar businesses). In my experience with these things, real startups can emerge from these efforts (like OpenOnDemand.com/ or BinaryPlex.com, which is where the founders met), but the real motivation is to give a learning experience - and so I am structuring the program so that it maximises that as the experience. I guess you could say it's like training, or as my friends Bart Jellema and Kim Chen coined for the Australian startup camps, "excercise for entrepreneurs".

Leena Rao from TechCrunch makes an argument that these efforts can stir up emotions and controversy. But that's exactly the point - in building a startup, you face obstacles. And if don't deal with them - which include infighting, things breaking, and crazy pressure - then chances are, you're not made for the startup world. Which is why these experiences are so valuable - you give people practice and exposure to these issues, and you end up developing better entrepreneurs.

As they say: good judgment comes from experience, but to get experience, you need to have made bad judgment. Here's to developing entrepreneurs, so that they have better judgment with their real startups one day.

Huge opportunities for exposure for sponsors, which will fund this experience. Contact me for more.

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