To print: Click here or Select File and then Print from your browser's menu

This story was printed from silicon.com, located at http://www.silicon.com/

Story URL: http://comment.silicon.com/0,39024711,39116704,00.htm

Leader: What Yahoo's video rewind tells us
The moving image - still the toughest nut to crack on the web?

By silicon.com

Published: Friday 31 October 2003

Although yesterday's announcement from Yahoo! isn't exclusively focused on the US - there's that important relationship with BT to consider, for one thing - there was a very real American flavour to the talks about halting paid-for video content.

But don't miss the global significance of the move. Charging for video over the web is tough and something littered with past miscalculations and missed opportunities.

Arguably the biggest play of them all was the 1999 purchase of Broadcast.com by - you guessed it - Yahoo!. Remember this was approaching the height of the dot-com boom meaning the price at the time - $5.7bn in stock - didn't raise nearly enough eyebrows.

Ever since, you can imagine the fervour at Yahoo! around making video work over the web.

The problem has always been securing access and the rights to content that people really want. (Broadcast.com made a large part of its name on airing archived episodes of programmes and those Victoria Secrets 'fashion' shows.) Sports led the revolution in cable TV roll out in the 1970s in the US and it is naturally something every ambitious content distributor wants.

So when it was revealed Yahoo! had won the online rights to World Cup football games last year, we expected something innovative and ultimately profitable to Yahoo!. After all, sports doesn't get much bigger than that quadrennial competition.

Yet Yahoo! got it all wrong. Instead of serving millions of Europeans who would pay for delayed games they'd missed after early kick-offs in the Far East, it produced a paltry highlights and 'classic moments' package with strange pricing. It never revealed who used it and to what extent.

Besides sports, of course the other big area that saw non-traditional delivery of TV grow was pornography - and that just isn't an option for many portal operators, with their typically wholesome image.

And the backdrop to the whole market doesn't help any provider - broadband usage is getting better but it still isn't used widely enough. Whether trying to reach homes with entertainment or businesses with useful information, there are barriers. The former suffers from lack of penetration via DSL, cable or satellite, the latter from firewall configurations and IT departments wary of carrying gigabytes of video over critical LANs.

Notably, in South Korea, with its high penetration of broadband, a study last year found programmes downloaded were typically repeats of soap operas that had been missed on mainstream TV. Viewers valued the second chance and were willing to put up with slightly poorer quality delivery in exchange.

Perhaps, when it comes to the net, video will for a long time be a premium offering for subscribers to other services - as per Yahoo's latest move and those of others. (You may have noticed silicon.com is one of many for whom video is now 'an added extra' rather than a staple.)

Whether it's conferencing, movies on demand or plain old streaming or downloading of content to various devices, video remains a tough nut to crack.