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eBahn Internet Broadcast Television is Here!
By Elisabeth Lawrence
There's a technological revolution underfoot, and Ed Clunn is leading the charge. Although you wouldn't mistake him for Mark Cuban, the founder of Broadcast.com and HDNet, Clunn's brainchild – www.eBahn.tv - is the next great development in broadcast television. With eBahn.tv set to become the first true Internet television network, Clunn can barely contain his enthusiasm.
"Our vision has been to bring hundreds of channels of 'real television' content to viewer's computer screens in the quality that they have grown to expect," effused Clunn, the chief technology officer of eBahn.tv. "The success of Broadcast.com and Mark Cuban inspired me to take the technical steps necessary to really deliver TV content over the Internet."
This techno-revolution in viewing is made possible because streaming video is now so advanced and audience-friendly that hundreds of channels of TV content are about to come to viewers right on their PCs. In the meantime, Clunn is sitting amidst a complex array of computer equipment in Vancouver, British Columbia, and is in the last throes of moving his company's data center to Los Angeles.
Cuban is a good example of how a simple concept can grow into a multi-billion dollar opportunity. In the early days of streaming, Cuban and Todd Wagner, who were big sports fans, founded a company called AudioNet, initially to provide out-of-market coverage for college basketball games. AudioNet eventually grew into Broadcast.com, which was purchased by Yahoo! in 1999. (Cuban is now the owner of the Dallas Mavericks basketball team.) When Yahoo bought Broadcast.com for $5.04 billion, Cuban's simple idea was definitely validated.
There certainly were naysayers to Cuban's concept just as there are critics today who are skeptical about Clunn's own vision. The advancements of streaming media changed those sentiments in Broadcast.com's case though. Streaming media, a method for transmitting multimedia files so that playback occurs upon arrival of the first data packets, was and will continue to be one of the key drivers behind Internet growth for years to come, according to a report by U.S. Bancorp Piper Jaffray (http://www.piperjaffray.com).
In an industry report released in 2000 on the future of streaming media, Gene Munster, senior technology research analyst for U.S. Bancorp Piper Jaffray, said that streaming media will be the next "macro-growth driver" on the Internet.
"We expect significant growth drivers in the streaming media sector, including the availability of broadband, simplified ease of use, the availability of content, and the convergence of the TV and the PC," Munster said. "We believe the Internet of tomorrow (two to five years from now) will resemble the television of today in terms of audio and video quality, while enabling users to control the media viewing experience." His predictions were clearly borne out.
Clunn believes with the continued acceptance of streaming technology, and the rapid growth of video stream usage, that the public at large will now be turning to their computer screens more and more for entertainment content. "The dramatic rise in streaming video usage is the signal to me that Internet TV will be accepted broadly in the next two years," Clunn confidently stated. "The companies that get in front of this trend now will be the big winners. I don't intend to be the next 'Johnny come lately'."
The rise of video streams is actually staggering when one views the numbers of individual video plays on a year-to-year basis. Video streams increased 80.7 percent in 2004, for a total of 14.2 billion streams, according to AccuStream iMedia Research (http://www.accustreamresearch.com).
"Growth was really strong in the number of [both] audio and video streams in 2004, outpacing even our own optimistic forecasts in the past," stated Paul Palumbo, research director of AccuStream, a media research firm. "I remember a few years ago when we had 3.5 billion video streams, thinking that was a really big number. Now, we're already four times that."
Robust growth continued in 2005, with a total of 21 billion streams (up 48 percent year-to-year) forecast for 2005. By 2007, the annual volume of video streams is projected to exceed 35 billion.
Just fifteen years ago, the thought of delivering hundreds of channels of television content over the Internet anytime in the near future was not taken seriously by many. The reason was simple: The only Internet users at that time were using dial-up connections that would bottleneck the stream of data necessary for true broadcast quality video. Those times have changed completely with the advent of various broadband technologies.
Broadband penetration rates have now made it possible for an Internet TV network to arrive on the scene. The number of U.S. at-home broadband users now accounts for 55 percent of the total U.S. at-home users as of December 2004, according to data from Nielsen/NetRatings. If this robust adoption rate continues, almost 70 percent of all U.S. home users will have broadband connections by the first half of 2006, according to forecasts based on Nielsen.
Even though broadband and streaming media technology are available, this doesn't mean the success is assured for a true Internet TV Network. Entertainment usage habits of the general consumer have to adjust and change in concert with both of these technology developments. This is now being played out as men and women continue to use computers more and more, and not just for work!
In a typical week, men spend 10.2 hours on a PC, 6.7 hours of which are spent on the Internet. Women spend a total of 8.5 hours using a computer, 5.3 of those are online. Media consumption across all categories, except reading magazines, is higher among men by an average of seven hours per week according to a Forrester's Consumer Technographics report. On the Web, men tend to surf for news, magazines, finance, job and career information. They also visit discussion boards and comparison shop. Online activities for women skew more toward utility: they get movie information, play games, share photos, and use online phone directories.
Compare these numbers with TV consumption and one sees how close Internet usage is to overtaking traditional television viewing. Men are watching TV 13.6 hours a week while women are viewing television for 12.1 hours each week. Men are also watching movies on video or DVD an average of 3.7 hours a week, and women are watching 3.3 hours a week.
The number to really watch, says Clunn, is multi-channel viewing. "People are now watching TV and working on their computers at the same time," observed Clunn. "As this trend grows eBahn.tv will grow with it."
The number of minutes adults spend simultaneously surfing the Web and watching TV has increased a dramatic 72 percent, from an average of 174 minutes per week in 2001 to 300 minutes per week in 2004, according to the latest "Media in Mind" survey by Universal McCann.
The 2004 Web/TV figure accounts for 20 percent of total weekly TV-viewing time for the average U.S. adult aged 18-49. In 2001, only 11 percent of total TV-viewing time for that age group was accompanied by Web use. The percentage of adult TV-viewing time that is potentially distracted or enhanced by Internet use has almost doubled in three years.
There is one other reason an Internet TV network may not have succeeded in the past, and that is the lack of real content. "People want to see the same type of content they can see on regular TV if they are going to watch Internet TV," said Clunn. "In the first quarter of 2006, eBahn.tv will be delivering almost 200 channels of content, the type of programming you would view with any cable operator."
At the end of the day, every business model has to generate more income than it spends and the timing may be right once again for the Vancouver media company. Advertisers are now moving their promotional budgets towards the Internet in ever increasing numbers. Online sales have also mirrored the increase in advertising.
Online retailers saw a 24 percent increase in sales in 2004. Growth by the end of 2005 is projected to rise by another 22 percent.
The 2004 growth rate of 24 percent outpaces traditional retail growth, which saw an increase of only seven percent. Last year, online sales accounted for 6.5 percent of total retail sales, up from 5.4 percent in 2003. In 2005, online sales are expected to account for 7.7 percent of total retail sales according to Forrester. "On the demand side, we continue to see more new shoppers coming online," said Scott R. Silverman, executive director of Shop.org, "and the new shoppers that have been online continue to get more comfortable."
Online advertising revenue is expected to reach $16.5 billion by 2005 according to research released today by Jupiter Communications, Inc. Interestingly enough, sponsorships are most popular on TV broadcasters' Web sites, such as CBSNews.com, BET.com, and FOXNews.com. "A significant number of sites owned by major media brands that experimented with streaming video advertising in 2000 and 2001, and then moved behind subscription services, reemerged as ad-supported content sites in 2004 and 2005," Palumbo added.
With all of these trends involving broadband penetration, Internet usage, streaming media viewing and multi-channel viewing on the rise, Clunn feels that it will be a very good year for eBahn.tv.
"We believe that the 'perfect storm' has arrived for the birth of our Internet TV network", said Clunn. "When the network goes live in January, all of the proverbial cosmic tumblers will click into place for eBahn.tv and we'll be off to the races." These are optimistic sentiments but they seem to be rooted in pretty sound logic. Are we looking at the next Broadcast.com? Just check the Internet in a few weeks and we'll all see.
About the Author
In Touch Media Group is pleased to announce that Elisabeth Lawrence has joined this leading edge Internet Marketing and Advertising Company as Head Copywriter and Team Leader for the ITMG Writing Group.
As a veteran writer and TV producer/director, Elisabeth Lawrence received 3 EMMY awards while at CBS. She also wrote for the Wall Street Journal, and later, as a TV & video consultant, she handled material for Fortune 500 clients including Exxon, Pepsico, The Ladies Home Journal, RJR Nabisco, J.C. Penney, Hill & Knowlton and United Artists.
As executive producer of talk shows and magazine series, Elisabeth developed her expertise in the public relations strategies that serve the needs of a diverse client portfolio most successfully. In addition, Lawrence was Bureau Chief, New York & Washington, for RTI Italian Television during Gulf I.
On the lighter side, Elisabeth Lawrence's entertainment producing and writing includes Jim Henson's Muppet Babies, NBC Saturday Night Live Commercial Parodies, and Entertainment Tonight. She also created and produced Low Fat, Healthy & Delicious" TV food segments for WFLA- Ch. 8 in Tampa Bay, the NBC affiliate.
In the healthcare arena, Elisabeth has consulted and produced for Mt. Sinai Hospital in NYC, Saint Anthony's Hospital, as well as Morton Plant Hospital in Tampa Bay, and the University of Medicine and Dentistry of the State of New Jersey. She also has a background in alternative health solutions, including health & fitness, from her tenure as Marketing Director of Shapes Total Fitness.
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