RealNetworks Joins the Media Ranks

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Just what we need: another tool-maker that thinks it's a
media company, aggregating and distributing on-demand content to a squinty-eyed audience.

Yet that's what RealNetworks has become with the release of
its "RealPlayer 7" -- and more particularly with the debut of "Take5,"
a daily audio-video magazine accessible through the new player.

RN is producing the showcase, which focuses on music,
entertainment, "news" and specialty programming -- much of it aimed at the youth
audience who adores this kind of material. Of course, the software also enables viewers to
access "My Channels" and "Live Stations," which offer on-demand
streaming audio and video from more than 100 programming sources such as ESPN, CNN, Fox
and ABCNews.com.

Actually, maybe a lot of online multimedia aficionados
think they do need this new tool. And why should they care if the content comes from a
mere software developer?

More than 3 million users -- mostly logging in via dial-up
speeds -- downloaded RealPlayer7 in the first week after its debut early this month. The
company says it is the "fastest ever" adoption rate for a software product
distributed over the Internet. (Of course, RN isn't yet saying how many of those enhanced
players have been tuned into Take5.)

Indeed, the new player -- an upgrade of the previous
RealPlayer versions, which have been downloaded to more than 88 million unique users
worldwide -- has several impressive features. It can be resized to enlarge or shrink the
video-playback window, enhancing the multitasking nature of a TV screen on the desktop.
Its start-up time is 40 percent faster than previous versions, and its memory usage is
about 40 percent less.

In other words, it's a step closer to bringing TV to the
desktop -- and it is being offered by a software developer in Washington state that is not
(as far as we know) under attack by a federal court.

Of course, by various measures, that 88 million-customer
base for previous RN products is a bit specious. Only about 25 percent of the users who
download such software (be it from RN, Microsoft or others) actually use it on a regular
basis, often frustrated by the slow download times of programming or the grainy,
thumbnail-sized visuals they can actually see.

Yet the breadth of RN's latest package underscores the new
kinds of competitors that are entering the digital arena, including on the programming
side. The company is expanding its ad-sales capability and acquiring global programming to
round out its media package.

RN's pitch material boldly compares itself to
"traditional" TV, declaring itself a winner in every attribute
("appointment viewing," multinetwork platform, "on-demand capability")
except the creation of original content.

So far, the RealPlayer7 represents a serious presence,
although many others are vying for a role in this tools market.

It will surely reach a broader market than RN's other
recent product debut: its "RealJukebox," which debuted in May and has registered
12 million users since. That product has appealed primarily to young music collectors,
many of whom were incensed at last month's scandalous revelation that the company was
keeping track of what customers downloaded and stored.

It sure seemed like a prelude to a knock on the door by the
copyright police.

Take5, the daily showcase -- in coordination with other
tools such as a new messaging service and an opt-in news flash -- begins to change the
structure of what viewers expect to see online and where they go to find it. As we near
the post-portal era, sites that offer an aggregated range of content will become
increasingly important.

Microsoft TV is, not surprisingly, demonstrating another --
albeit comparable -- approach to the same issue: software toolmaker as media mogul.

In the Microsoft WebTV service now rolling out as part of
the EchoStar 500 package, there's a new Information Channel among the video lineup. It's
an on-demand collection of text-and-picture news, sports, business, lifestyle and weather
pages, some of which feature streaming video.

The content is displayed in HTML-like format, but it is
actually transmitted as digital video. (Adroit media observers may appreciate that the
major sections are displayed, respectively, in a familiar color scheme of blue, red,
green, lavender and taupe for the weather page: Hello, Gannett.)

Microsoft is producing the collection of material in
conjunction with -- but separately from -- its Microsoft Network and MSNBC ventures. In
other words, here's a timely, updated TV-on-demand package that doesn't even require a
customer to go to the Web, although he or she can easily do so through the very same
set-top box.

The lure of creating content continues to appeal to tool
companies that want to move beyond their core businesses. Sun Microsystems has already
hinted at its plans for Western Show revelations: They include alliances with AT&T
Interactive TV content, Oxygen Media and The Weather Channel.

Will it be solely as an enabler? Doubtful.

I-Way Patrol columnist Gary Arlen envisions a software tool
belt with built-in clapboard and Panavision viewfinder.

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