Verizon officials are about to roll out a new digital media utility service that will leverage the company's ongoing investments in its worldwide IP network to reduce the costs and burden for entertainment companies that deliver online content to customers through their televisions, smartphones and other mobile devices.
Unveiled April 11 at the 2011 NAB Show in Las Vegas, the Verizon Digital Media Services has been in development for more than three years, and currently is in beta testing, according to David Rips, president of Verizon Digital Media Services. It should roll out for commercial release in July.
The end-to-end digital media network is designed to give media companies-from advertisers to media groups to entertainment businesses-a more cost-effective and efficient way of managing and distributing their content to a customer base that has a rapidly growing number of devices with which to receive the content, from TVs to smartphones to tablets, Rips said.
"This is ... a new type of business for Verizon," he said in an interview with eWEEK. "It's essentially a value-added service."
Verizon is aiming the service at content creators-from videos to games to music publishers-and content distributors, all of whom are under pressure from customers, who are looking to get the content they want on the device that they want. The problem is that traditional avenues for distributing media-such as television networks-were not made to meet the demands of the current environment, Rips said. For example, television networks are built for a one-to-many scenario-broadcasting-rather than the current one-to-one demands, which he called "unicasting."
With unicasting, the number of simultaneous media streams, formats and data transfers skyrocket, Rips said. Broadcasters aren't built for it, and neither is the Internet. Traditional media distributors don't have the money, resources or networks to meet customer demands for customized, on-demand content. They're spending too much on delivering media content, and would need to spend millions more to keep up with the demand, he said.
Verizon's new service is designed to take that task off their hands. The utility service will automate such processes as formatting, managing and delivering digital media to any device or platform, and will be able to do it on a large scale, Rips said. Verizon already has much of the infrastructure to do this, he said.
"We're leveraging the giant network Verizon already has," Rips said, adding that more than 200 engineers have worked on the project creating the company's Digital Media Services. "We can achieve the economy of scale ... that will create an economically viable model."
Mike Weintraub, director of technology for Verizon Digital Media Services, said Verizon already has much of what such a distribution network needs, including large data centers and a sophisticated infrastructure.
"It's big, it's reliable and it's secure," Weintraub said.
Turner Broadcasting, Hearst Magazines and The Associated Press are among the first digital media content companies to use Verizon Digital Media Services' capabilities, according to Verizon.
The Verizon Digital Media Services will address the increasing consumer demands for a faster, more customized and more on-demand digital media experience, Rips said. And consumers want that enhanced experience, even if it means spending more, he said.
"People are willing to pay a lot of money to get a high level of [digital] media," he said, adding that the rub is that it costs money to meet that demand. "We know what the customer wants, but what they want is very complex [and] very costly."