In today's VideoDaily Roundup, we keep tabs on the latest developments from the Senate Commerce Committee hearing on online video innovation. Akamai’s longtime CEO, who led the company through a period of incredible growth, steps down. The New York Times' David Carr uses a few anecdotes to assess Netflix's slide, and finally: why life is so good at high-flying Ooyala.
Digital Execs Urge Senate Committee to Keep the Web Open
The AP reports from the front lines of the Senate Commerce Committee hearing on online video innovation, saying that the group of digital media execs called on to educate the committee on the issue believe that tremendous growth in online video will continue for years to come -- provided that broadband Internet access is made widely available to all Americans.
Microsoft's Vice President for Media and Entertainment, Blair Westlake, said that universal access to high-speed broadband was "the single most important issue shaping the future of video." He predicted there would be more change in the next 18 months than had occurred in the past five years.
Paul Misener, vice president for global public policy at online retailer Amazon.com, agreed that tremendous growth for digital video would continue, but "this assumes the Internet will remain a non-discriminatory, open platform." He warned against ISPs and mobile carriers imposing "immutable or unrealistically priced" ceilings on how much data subscribers are able to download.
Barry Diller, the former TV and movie studio boss who is now chairman of IAC/InterActive Corp, also urged Congress to ensure that “the rules of the game favor entry and innovation"-- not the financial interests of "incumbents" like cable, telephone and satellite providers.
Akamai CEO Steps Down
Akamai, which operates a content delivery network that helps businesses deliver data faster online, announced during its Q1 earnings report that CEO Paul Sagan would step down by the end of 2013. Sagan has been CEO since 2005, during which time the company’s sales more than quadrupled -- hitting $1.16 billion in 2011, up from $283.1 million in 2005.
As Bloomberg BusinessWeek reports, Sagan helped the company become less dependent on the commoditized content delivery business by acquiring its way into areas such as cloud computing. Analysts said Akamai would likely replace Sagan with someone with a corporate sales background who has worked in hardware or software. The company said the search for a replacement would begin immediately.
No End in Sight for Netflix’s Woes
In the wake of last summer's “ill-conceived” pricing plan that put Netflix's stock into free fall, CEO Reed Hastings said it could take three years for the company to recover. “He is turning out to be more than correct,” New York Times columnist David Carr says. Indeed, in its Q1 earnings report, Netflix lost $4.6 million --its first loss in seven years -- and said its international expansion would be delayed. The stock promptly fell 14 percent.
Like so many other subscribers, Carr downgraded to Netflix's streaming product when given the option, which means he went from paying $25.99 per month to just $7.99. But the barrier to entry in the streaming business is low and the competition is high -- a matter of concern for the company. As Carr says, “I have lots of streaming products on my television, including Hulu Plus and Apple TV -- and, of course, there's the whole backlog on my DVR. I’m not short on viewing options, I’m short on time. Netflix has become just one more player in the gunfight for my attention.”
Ooyala Chief Sees Ample Opportunity Amid Online Video Growth
FierceOnlineVideo has an interview with Ooyala CEO Jay Fulcher, following the online video platform's announcement last week of a new technology that delivers personalized content recommendations to consumers throughout Ooyala’s network on any device. The technology uses data collected from Ooyala's 200 million monthly viewers across its network of publishers that use its video platform. "We've been focused on analytics since we launched," Fulcher said. "But this takes it a step further, and it sets us apart from other companies."
Fulcher added that online video has reached an inflection point: "[Online video is] transforming, " he said. "Publishers and content creators increasingly are looking for ways to get content directly to consumers, creating new options for monetization." As Editor Jim O’Neill notes, the biggest threat to Ooyala and competitors like Brightcove and KIT Digital is do-it-yourself solutions that publishers and distributors have built in-house. "Content owners tend to retreat to things they know best -- their content, for example,” Fulcher said. “The challenge in our industry is convincing them that we can do a better job than they can with that content. And that they should concentrate on what they know best."