Brightcove: Online Video Snowballing Into $500 Million Market

TiVo Deal Will Serve Digital Video to Subscribers' TVs

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NEW YORK ( -- The idea of an open-distribution model for online video has been bandied about for the past few years, but with little impact on the walled gardens of cable and satellite companies and, more recently, telecom video services. However, since October there's been a steady stream of direct-to-consumer moves by media companies. The latest? A deal making Brightcove content available to TiVo subscribers.
Brightcove is a distributor of online video.
Brightcove is a distributor of online video.

Warner, Fox deals
Under the agreement, announced today, Brightcove will begin distributing some of its broadband video to customers of TiVo, the Alviso, Calif.-based company that has made digital video recording a household name. The agreement comes to light in the same week Warner Bros. said it will make its TV shows and movies available to consumers via BitTorrent software and Fox put up 16 programs on Apple's iTunes.

"The snowball is slowly gathering speed and getting bigger as it rolls down the hill," said Adam Gerber, VP-advertising for Brightcove. Mr. Gerber predicts over the next 12 months, $500 million will be spent in advertising in the online-video sector.

Brightcove, an Internet company based in Cambridge, Mass., distributes video content created by its producer and programmer partners to third-party sites across the Internet. Most of the content is ad-supported and ad revenue is shared between Brightcove, its content partners and the third-party distributors.

Under the terms of the deal, TiVo will begin offering its subscribers select Brightcove content from partners expected to be announced in the next few weeks. A customer will opt in to a particular piece of Brightcove content, which will then be forced over broadband to the TiVo set-top box where it takes up hard drive space until it's deleted.

Select customers and partners
The process is a bit clumsier than what most pundits suggest a future open-video platform would look like: Only select Brightcove partners will be distributed to TiVo customers and only those customers with the new Series T set-top box who have connected their TiVo service to a broadband connection will be able to use the service. (At the moment that means about 400,000 customers.)

Still, it's another step in taking that open, direct-to-consumer content to the 10-foot viewing environment. Key for Brightcove and its chief competitor, a company called ROO, will be an Internet-connected set-top box that delivers online video to the TV. And while companies are beginning to experiment with how consumers get access to the content, other challenges remain, chiefly technical perspective and bandwidth capabilities and legacy production business models that have to change. Said Mr. Gerber, "This is the first step in a long series of steps."
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