Broadcast.com presentation about its broadcast services

2. Webcaster
An individual(s) misguided enough to
think he/she can change the way the
world is entertained and communicates

3. We’ve come a long way in 4 years….
Streaming Media is causing us to rethink
the big media picture and face
important issues

4. #1
What is Media
 Media used to be defined by its spectrum
– TV by channels
– Radio by stations
 Not in a streaming media world
– All digital media is just a stream of bits
– Whats the difference between Digital Cable and
Streaming Video ?
– Both are just streams of video sent to a
computer output to a monitor !
– Streaming Video can vary its bit rates
– Streaming Video can be inherently interactive
 Streaming Media is already dominant in the office.
– Only 9% of office workers can get TV while more
than 95% can receive streaming media !

5. #2
What is Content
 It used to be defined by its packaging
capacity
– CD - 62 Minutes / VHS - 1 Movie
– DVD - 3.7gb
– Not in a digital world
 Content is now available live or on
demand
 Its defined by its availability as a stream
or transportability as a file
– Do I have to go to a website
– Can I send it as an email or take it on my Rio
 The amount of video content on the net far
exceeds the amount available through any other
medium

6. #3
What is a Broadcaster ?
 Every company is a broadcaster
– Dell, GM, Intel, P&G…
 Everyone is a broadcaster
– For Free you can reach your friends using MP3
streaming or Windows Media from your home
– For 5k a month you can reach a niche
audience using a provider
 This is just the beginning
– within 3 years there will be >1mm
video channels
– within 10 everyone will have a personal
channel

7. #4
What is TV ?
 TV is an alternative to boredom
– Its what you do when you have nothing better to
do
 Cable TV
– is a video monitor connected to a stupid
computer (STB), connected to a wired network
that is limited in what it can provide
 Streaming Video
– is a video monitor connected to a smart, but ugly
computer, connected to a wired network that is
unlimited in what it can provide
 When computers start looking like they
belong in the living room, and broadband
becomes more available, streaming will
change the definition of TV

8. #5
How do Corporations
Communicate ?
 Real Time Communications is having a
profound effect on the business world
– CEOs can now speak to their employees on a
regular basis
– Product Introductions can be held online
– Quarterly earnings conference calls and
Shareholder Meetings can now reach all
shareholders
– Multimedia can be added to product
descriptions
 Applications continue to appear and streaming is
becoming mainstream in many corporations !

9. But our progress is being hindered ….
Not everyone is doing their part…..

10. #1
Digital Millenium Copyright Act
 Webcasters have become the poster
children for record label abuse. What they
couldn’t get from Radio, they try to take in
abundance from webcasters!
 We should have to pay copyright owners
for their work.
– The question is how much
– RIAA is not asking for fair compensation

11. #1
DMCA Economics
 RIAA is asking for as much as .5 cents per
song from webcasters
– There 12 to 20 songs played per hour
– Using .3 x 15 songs = 4.5cents which equals
– $45 CPM per hour of listening
– This is CRAZY Pricing
 Or a Percentage of Revenue
– As high as 15% has been reported
 Penalizes those that have revenue,
rewards those that don’t …
 Corporate Intranets have it even worse
– Company Intranet Radio stations and events could
cost you a fortune !

12. #1
DMCA Programming Politics
 Artist Complement Act
– Limits # of songs from an artist/CD that can be
played in a time period
– Requires that pre-recorded loops be a minimum
length
– Requires us to show title and artist
– Prohibits webcasters from pre-announcing songs
– None are hard, but all put us on uneven ground with
traditional broadcasters
– Only makes it harder for us to compete with
traditional media.
– They can run 24 hour Beatles, we cant
 This might have been OK 2 years ago when this
was being negotiated, but with MP3s and
Jukeboxes everywhere, its ancient, and it needs to
change

13. #1
What you should do...
 Talk to a copyright attorney about your
options
 Join lists like the webcasting.net list to
get educated
 Call your Congressman and Senator…
 Move your servers to Canada
– Laws are realistic
– They are supportive of webcasters
– They are looking for ways to create bandwidth flow
OUT of Canada
– www.iceradio.com for a great example

14. Deep Linking
 Linking directly to Media Files is a way for all of us
to subsidize wanna-be portals.
 Direct Links Deprive webcasters of sales of
Banner Ads, Interstitial ads, Sponsorship and
Branding.
 This is not the same as linking to a webpage.
– The cost to deliver a webpage is negligible
– The cost to deliver a stream is not
– ASCAP/BMI
– DCMA - $30CPM
– Bandwidth
– Stream Licenses
– Server Capacity
– Support
 We need to stop this as an industry
#2

15. Audience Reporting
 We have got to stop playing this game of
my webcast is bigger than yours
– As an industry we are starting to look more clueless
than the reporters who write about these events
 A hit, stream served or visitor is not a
UNIQUE user.
– All of these terms have been misused to mislead
#3

16. Audience Reporting
 May I suggest, that if you choose to report
on the size in terms of users to an event,
that we employ the following metrics
– # of Unique Users
– Ave. time spent on each stream
– Its not hard to capture, its all right in our logs
 This will at least demonstrate that as a
medium we understand our own statistics
and we are able to convey the reporting
advantage of streaming - actual usage
 And to help keep us honest...
#3

17. Audience Reporting
 There are 3rd party ways to at least
qualify numbers to some extent
 All 3rd party streamers include a defining
URLs in their presentations
– http://www.broadcast.com/thisevent.asx
 Media Metrix tracks these URLs
– Media Metrix ratings/uniques per mo.
– Broadcast.com 6.0 - 3.7mm
– RBN.com 1.4 - 864,000
– Intervu.Net .7 - 438,000
– Netaid.org - not enough
– Winloud.com - will be interesting
– All URL driven webcast audiences show up
#3

18. Vendor Issues
 Real, Do Not Mislead Users to a Paid Player
– Too many users are mislead into thinking they must
pay for a player because they cant find the free one.
– It makes the users mad at us, not you
 Its time to offer some server management
tools, any tools
– Its not that we cant create them we can.
– But every time you change your software, client
and server, which is often, our tools and services
are immediately out of date
– Then we spend far too much time figuring out
what to change to match your changes !
#4

19. Vendor Issues
 Stop making ridiculous player download
claims.
– They are meaningless and misleading
– Let us know what percent of new PCs are shipped
with your product to alleviate download fears
 If you say you are compatible with a
particular operating system, please release
compatible versions on a timely basis.
– We are tired of being told we just upset an entire
company because we upgraded a server and their
players are no longer compatible
 Real, please pick a consistent pricing plan.
– Its no fun to compare notes with friends and find out
that pricing is all over the map.
– We don’t mind paying for streams nearly as much as
we hate the fight we go through to buy them !
#4

20. The Business of Streaming Media
Some Observations…..

21. Webcasting -The Business Side
 This industry is just beginning.
– It is probably about a 250mm business in 1999
– I expect it to grow to 750mm the following year, and at least
triple each of the next 3 years
– Streaming media will be expected as part of almost every major
website
 The base of revenue will be services
– EVERY company and website in the world can benefit
from real time streaming communications
– 80% of revenue will be streaming services
– 20% will be advertising around content
#1

22. Growth will be Incredible !
 We will see the number of events broadcast over the
web EASILY TRIPLE each of the next 5 years.
– But this will only increase audience
fragmentation per event.
– The number of Victoria Secret size commercial
webcasts of more than 1.5mm UNIQUE users
will number less than 5 per year.
– Only breaking news will surpass Vic Sec on a
regular basis
 Service companies should focus on selling services
and events, NOT in pushing bandwidth
– Value added services will mean profitability
– Selling needs to be a core competency
– Customers wont show up at your door, you
need to go find them
 The Sky is the limit
#2

23. Profitability is King !
 Webcasters must operate for profitability
 Everyone is a genius in a bull market,
– But the market wont stay hot for ever
– Nor will VC funds always be available
 Within 12 months it will be put up or shut up time
– Investors will have been able to see what
webcasting models work, and which don’t.
 We are starting to see the impact of this with the
lagging valuations of streaming related stocks and
companies like
– AudioHighway
– Tunes.com
– ForeignTV
 They are all underperforming other internet stocks
or private company equivalents
#3

24. Advertising Supported Content
Sites will have it Rough.
 The toughest asset to create on the net is traffic.
– Generating traffic for original content without
any inherent demand is the hardest of all
– Without critical mass traffic its impossible to
generate any level of revenue
 Audience fragmentation will make it far harder to
create hits on the net than on TV
 The best original content model ?
– The 1 minute video that can be sent as an
attachment with email
#4

25. Picking Who Streams Your Content
Finding the Best Solution

26. The Decision Criteria
 Can your provider help you generate
demand ?
 Will your provider stay in business ?
 Can your provider scale ?
– UniCast Networks
– Multicast Networks
– Number of Streaming Events
#7

27. How will you generate demand
 This is the greatest challenge for any content
provider
– Everyone thinks their event is the next Victoria’s
Secret
– The reality is that most events don’t reach 1,000
simultaneous users
 You must be realistic in setting expectations
 The right partner will assist you in determining how
to acquire the most relevant & largest possible
audience
 It’s the key to a successful event, and for content
based businesses, it’s the key to financial success.
– A content based site without eyeballs, wont be
in business very long
 For DiskJockey.Com we increased their audience by
more than 500% in less than 5 months !
#7

28. Will Your Provider be in Business
?
 The best providers establish long term relationships
with their customers
– We get to understand our customers business
– We invest in our customers and provide
ongoing support and resources
– We have customers that have been with us for
four years !
 Many providers are in business to play the stock
market rather than show a profit
– Is your provider profitable ?
– Or are they showing ever increasing losses ?
 Yahoo is one of the most profitable companies on
the net and Y!Broadcast is a profitable contributor !
 Before choosing a vendor, make sure they will be in
business !
#7

29. Scalable Networks - Unicast
 The greatest challenge to Streaming Service Providers
is NOT scaling unicast audience size.
– Anyone can add servers and buy bandwidth
– Regardless of what city the servers are in
– If you connect them in any way to the top 20
networks they will work until you run out of
bandwidth or servers
 At Yahoo!Broadcast we pass 1gbs of unicast
streaming traffic on normal weekdays
#7

30. Scalable Networks - Multicast
 True Scalability for Streaming Media will come from
Multicasting
– There is no limit to audience size
– True Broadcast Model
– The Problem with Existing Distributed Servers Networks
is that they are not MultiCast Capable
 Multicast Streaming is thriving at Yahoo!Broadcast
– Yahoo!Broadcast is the only provider with experience at
multicasting at all bit rates, all streaming vendors
– Yahoo!Broadcast is the only Commercial, Multi-Network,
MultiCast enabled Network in the world
– With more than 50 MultiCast Enabled Partners
– We can reach more than 1mm simultaneous users
on multicast networks !
– Yahoo!Broadcast has done thousands of 100% multicast
broadcasts
– As many as 40k simultaneous multicast users !
#7

31. Multicast Affiliates
52+ and growing
 Accesscom
 ACI
 ATMLink
 BorderNet
 Carrier1
 Cais
 CharmNet
 CoastLink
 CyberZone
 DirecPC
 dotSTAR
 Electric Lightwave
 FlashNet
 Galaxy Star
 Granbury.com
 Great Basin Internet Services
 IDT
 IIJ
 Information Highway
 InLink
 InMotion
 InReach
 Insync
 Jato
 Jump Net
 Level 3
 Lightspeed
 Megsinet
 MicroCore
 Midwest Web
 Mobile Star
 NetCarrier
 NetConcept
 Network Internet
 Nortel
 Nova
 PIXINet
 South West Plains Communication
 Splitrock
 Sprint
 SysNet
 Teleglobe
 Telepak
 The Internet Connection
 The-OnRamp.Net
 Transport Logic
 UniComp
 uniView
 Verio
 WebNet
 ZebraNet
 ZipLink
#7

32. The Real Scalability Challenge
 The reality of the streaming market is that the # of
live streaming events is exploding.
– But most live events are narrowcast events that are
designed for under 100 simultaneous users
– Distance Learning, Corporate Presentations,etc
– Most require multiple BitRates and Multiple Streaming
Formats
– The challenge is to be able to cost effectively deliver
thousands of simulaneous events, each with top level
quality, with out any failures
– The cost issues for doing many events, with multiple
bitrates are very different than doing a couple large
events
#7

33. The Cost Breakdown of a
Broadcast
 A typical live broadcast today requires the following
bitrates to be streamed
– 20k, 32k, 100k, 300k, 1mbs
– In total 1.452mbs
– In two formats, WMT and Real
– Total encoded bits sent to servers - 2.9mbs
 Send these streams to 20 distributed servers across
the net and you are using 58mbs just to reach the
servers before you have served a single stream to an
end user !
– Now imagine if you are streaming 1000 of these
events at once.
– You would be using 58gbs of internet bandwidth
before serving a single end user !
– Its hard to make those economics work
#7

34. The Benefit of a Centralized
Network
 At Y!Broadcast the links between the encoders and
servers are localized to one of 2 networks in Dallas,
or a 3rd Redundant location in San Diego
– This gives us the lowest cost to deliver the
greatest number of events, large or small
– It removes any Internet Risk of the encoded
stream not reaching a server
– It allows us to leverage our multicast network to
scale audience size
– We can deliver any any bitrates, from 6kbs to
more than 1mbs with the equal ease and
reliability.
 So, when chosing a service provider, consider all the
issues, not just meaningless capacity claims !
#7