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Home Grown Video

by Pamela Parker
Managing Editor of ChannelSeven.com and Internet Advertising Report

Checking my e-mail at home the other day, I clicked on a message from my brother and up popped a video window. There, on the screen, I saw my younger sibling, his wife, and their adorable Beagle pup. I noticed my brother's recent haircut and his new glasses, and I laughed at seeing my sister-in-law waved the dog's hand "hello" as he wriggled in her arms.

They'd just purchased a new Compaq computer and it came with a Web cam -- an accessory that's grown increasingly less expensive (I got one for around $40) and is often now included with PC packages. In fact, they're growing so common that IDC predicts that worldwide shipments of PC cameras will have increased 300 percent to 11 million by the end of the year. By 2004, the research firm says, that number will grow to 44 million.

Meanwhile, excitement is arising over streaming video -- and its potential for advertisers. But one of the big questions has been about the cost of producing the video content that wraps around the ads. After all, some of the most spectacular failures in dot-com land in recent months have been nascent streaming video content players -- Pseudo, POP.com, and DEN are three well-known examples -- that burned out before streaming video advertising really took hold.

Content on the Cheap
Now, some in the Internet industry are looking toward those increasingly ubiquitous Web cams to solve that problem. They're looking to put advertising on messages featuring brothers, sisters-in-law, and their dogs. Well, not exclusively. . .

It's the latest mutation on advertising-sponsored user-generated Web content. First we saw discussion boards, chat, and home page building. Now community is going audio-visual.

"We really believe that the next killer app will be a Web cam," says Marise Nazzaro, co-chief operating officer of Oediv, a Los Angeles-based start-up developing broadband video applications (whose name was derived from spelling video backwards).

While there may be some dough in tacking commercials onto videos sent via e-mail by friends and family members, the real opportunities, according to the players in this nascent space, are in video-enabled communities. Rather than just publishing home pages, or participating in chat rooms, individuals can create personal videos about the subject areas they are interested in.

Meanwhile, the advertisements can be targeted to match that particular subject area. Say, for example, I am such a fan of Christina Aguilera that I video myself lip synching "Genie in a Bottle." Anyway, I could put this video up on my personal Christina fan page, and the ads could tout similar teen-oriented products. Sellers on eBay could produce videos about the products they are selling, as well, and the ads could reflect the page on which the links appear. Or the commercial on eBay could be for UPS, because you know that the viewers are likely to use shipping services.

These published videos, after all, are likely to get significantly more views than one I e-mail to my brother (unless I'm lip synching Christina Aguilera, in which case he'll forward it to everyone he knows so they can share a laugh).

Taking Community to the Next Level
That publishing model is why another video technology start-up, New York-based iClips, has been busy striking deals with community sites like The Globe.com and Homestead.com. These deals basically allow members of these community sites to produce and post streaming video (in the Real Player format) on their Web pages. If you've ever tried to produce, digitize, and offer streaming video yourself, you'll realize that the ease with which iClips allows users to do this belies the complicated process that lies beneath. For the user, though, it's simple. Press record, press stop, and then add the video to your Web site.

The process is similar on a new site launched a few weeks ago by Oediv. It's called Vidville, and it's basically a forum for people to sound off on whatever subject they're interested in. Politics, television, film, sports, or whatever floats your boat. It's there in living breathing talking color. Instead of just mouthing off in text, people can literally speak their peace. Although there aren't any advertisements so far, the site is ripe for them, and Oediv is partnering with iBoost.com, a fellow Softbank portfolio company, to sell banners on the pop up video screens.

So far, this concept is novel, and people will click just to see what lies behind door number two. But whether they'll keep clicking or not will depend on whether the content is consistently compelling. When it comes to mom-and-pop stuff... well, I'll click on something my brother sends me no matter how boring it may be. But something that just gets one or two views probably isn't worth it advertising-wise, and the volume on community sites just doesn't exist right now.

Still, it's not like iClips and Oediv are burning through dough at the rate of, say, DEN or Pseudo. "We're not spending millions of dollars on content," says Michael Diamant, iClips' chief executive officer. "We're not a content company, we're a platform." So, in the meantime, while the advertising opportunities shake out, the two firms are looking to license their technology to corporations and other users. "The advertising model is sort of a longer-term model," said Diamant. "We need to look at other ways to generate revenue and we were doing that. But there will come a time when Web cams will be as common as speakers are." And marketers, of course, will be there to seize the opportunity.

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