Stream-Rolling Into Video Reality

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Lariat Software, Virage and ChannelSEEK demonstrate the
imminence of streaming media -- especially video Webcasts -- as a factor in the
interactive environment.

These companies aren't the big infrastructure
technologists, like RealNetworks, or the Wall Street darling system operators, like
Broadcast.com. Rather, these young companies are creating specific tools for streaming
video service.

Lariat specializes in reporting, measurement and
asset-management software to help site operators determine if anyone is actually watching
the streaming programs.

Virage (and its competitors, such as Excalibur
Technologies) sells tools that search Web video, enabling users to pull out specific
visual sequences. CNN, C-SPAN and other TV-allied Web

sites are using this technology to offer video searching on
their sites.

ChannelSeek (and others like it) provides a media guide to
let surfers know what they can watch on the Internet.

With such specific tools in its arsenal, the
streaming-video business is ready to explode. And it needs bandwidth -- the kind of
bandwidth that cable-modem services could provide, especially if they didn't have
those nasty restrictions about cutting off streams after 10 or 15 minutes because they hog
the shared pipeline.

The "streamroller" that is taking shape in the
Webcasting world was clearly evident a few weeks ago, at the "Streaming Media
East" conference in New York, which attracted 2,000 attendees and nearly 60
exhibitors. Not bad for a business that has barely caught the attention of many Internet
users. For in reality, and despite the hype, only about one-fourth of Internet users have
downloaded and installed the media players, such as RealAudio, RealVideo or
Microsoft's Media Player software. (Microsoft bashers love to point out that this is
one category where the Redmond giant is being overrun; RealNetworks controls 80 percent of
this audience.)

Moreover, this young industry faces economic hurdles.
"With every increase in simultaneous streams, there's an increase in bandwidth
costs," explains Lisa Amore, marketing vice president of TV onthe WEB, a
streaming-media company that offers one-dozen "channels" of specialized video
shows. Its lineup ranges from ethnic and special event programming to an "Equestrian
Channel."

One indicator of where streaming video is heading comes in
the form of a mysterious start-up called iCast Corp. It is headed by Neil Braun, a former
NBC and Viacom executive, and backed by CMGI, the Internet greenhouse that has spawned
numerous Web successes.

In guarded terms, Braun's keynote at the Streaming
Media East conference described a new type of programming for this new platform --
something that could be called "Two Minute TV."

Braun described very short newscasts, interviews and
micro-dramas that could be summoned on-demand to a desktop. These shows might be viewed
when a person needs an update, when he arrives at the office or when he wants a short
video break.

Braun talked about learning the principles of this new
medium, such as, "Rich media creates the opportunity to bring people close to an
emotional experience. That's entertainment."

Indeed, entertainment is at the core of iCast's
agenda. Although not revealing content deals or details, Braun indicated that sports,
music, film and TV will make up iCast's core offerings when the service debuts this
fall.

Characterizing the streaming opportunity as "a new
mint," Braun outlined the value of this format as a way to reinvent business models
for video media. iCast plans to establish subscription services, assuring a recurring
revenue stream, and to take a share of transactions created within the streaming content.

"Relatively few businesses will be profitable based on
advertising alone," Braun said. "Each iCast brand will have a membership
fee." The personalization and participatory nature of streaming media will also mean
that viewers "are receptive to paying a premium" for such content and for the
transactions that are built onto them, he added.

One interesting demographic element emerged from
Braun's remarks, but it is reflected through other highly visible (or audible)
aspects of the streaming business.

As a graying media executive, Braun admitted that he is
seen by his former TV-industry colleagues as one of them "who has gone over to the
other side of the fence." Nonetheless, he acknowledged that iCast's target
audience will skew young -- 18 to 34 years of age, mostly college students and young
professional workers.

That cohort, plus the teen-age group just behind them, are
the adopters of MP3 and other streaming-music services. They represent the target for most
of the streaming businesses that are now taking shape.

That's the audience all of those tools from Lariat,
Virage, ChannelSEEK and others are being built to reach and interpret. For traditional
media companies, it's going to become a matter of survival to get aboard this rapidly
moving stream or be crushed under the streamroller heading their way.

I-Way Patrol columnist Gary Arlen enjoys a serving of
streaming hot Java on a regular basis.

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