Internet TV on its way to the masses

by Andrew Walmsley, Marketing 07-Feb-07

In the early days of satellite TV, back in the analogue era, hours of harmless fun could be had channel-surfing the weird offerings of foreign TV, writes Andrew Walmsley.

In those days, Eurosport would fill the many hours between recognisable sports with live logrolling from Arkansas, and the desperate late-night viewer would be left with no alternative but to tune in to 70s Bavarian soft porn on German TV, where lederhosen and white slingbacks were the uniform of choice.

Satellite TV didn't seem important then - it was just a novelty to have an alternative to the four channels available to mere mortals. Sky and rival BSB fought it out over meagre audiences, and balance sheets ran red.

All that has now changed. Sky is in more than 8.5m homes in the UK, and three-quarters of homes now have digital TV of some sort. Multichannel TV is mass-market, and the novelty factor has disappeared.

But the internet is recapturing some of that feeling. Want to catch up on the latest from Kabbalah TV? Cuban TV? Albanian? Ten channels of Vietnamese TV? These and hundreds of slightly swivel-eyed religious channels of various denominations are now available on the web.

The explosion in availability of channels over the internet doesn't mean internet TV is set for the big time, though. There is a fundamental problem faced by TV on the web - a technical barrier that prevents the market growing with demand.

Conventional TV is highly scalable. The signal is broadcast once, and as many people as are awake can receive it (though BARB doesn't insist they are actually awake). The 'load' on the transmitter is the same whether 10 or 10m people are watching. But with web TV, the signal is streamed from a server to your PC. Each new viewer requires a stream of their own - and demand on the server therefore scales in proportion to the audience.

So there is a high price to pay for success in the web TV world. That is why so much interest was generated by the recent debut of Joost.com - a peer-to-peer TV system founded by the people behind Skype and KaZaA, using part of the $2.6bn eBay paid for Skype in 2005.

Peer-to-peer networks break this viewer/server relationship by distributing the task across thousands of users, each of which serves a part of the file to other users. So, rather than grinding to a halt, peer-to-peer networks actually become more efficient as more users come online.

It is not the first peer-to-peer application to be applied to TV - the BBC's Integrated Media Player did it last year, and KaZaA has been at it for years. But Joost does it to streams - in other words, you can watch live rather than downloading for later.

This is crucial, as it removes the 'planned viewing' nature of downloading, allowing impulse behaviour and a more TV-like environment.

There is a virtuous circle that must be in place for online TV to succeed: content (stuff to watch), devices (things to watch it on), delivery (how it gets there) and audiences (people to watch). According to PricewaterhouseCoopers's 'Global Entertainment & Media Outlook', there will be 286m broadband households globally by the end of 2007 - three times the size of the US TV market. Joost has cracked the distribution conundrum that has held online TV back, and built in the piracy protection that content owners demand.

Currently, the system is still in limited beta form, but the picture quality is impressive for such an early stage - not DVD, but better than VHS. It still takes too long to change channels, and the content is fairly limited - music videos, extreme sports and channels that hark us back to where we started, the good old days of satellite - Wet 'n' Wild and Paris Hilton.

Skype took just three years to reach 136m users - if Joost does the same for online TV, we won't be watching logrolling for much longer.

Andrew Walmsley is co-founder of i-level

30 SECONDS ON ... LOGROLLING

- Logrolling or log-birling - the practice of standing on a log and rolling it - developed from the technique of 'river pigging' in which lumberjacks floated on logs to guide them downstream and avoid log jams.

- When the 'piggers' reached the saw mill, they and other workers there would have contests to decide who was the best axeman, sawyer or river driver. The river-driving competition would comprise two or three men on a log in a river or pond rolling it out between them. The last man standing was the winner.

- The first official Logrolling World Championship was held in 1898.

- The sport is now a regular feature of lumberjack contests in the US.

- One variation of the sport, apparently rare today, is Trick and Fancy, in which the rollers perform stunts on the log. Usually carried out with a partner, these can range from jump rope to doing a headstand on a chair while balancing on the log.