2003 has already been productive for the Seattle technology company RealNetworks. With its partners, it launched two new major services: ABC News Live, a 24/7 online news broadcast, and MLB.TV—a venture with Major League Baseball to Webcast live video of the leagues thousands of games. RealNetworks technology also became the de facto delivery mechanism for much of the live, breaking news from the War in Iraq, turning already connected citizens into online junkies hungering for news at all times of day. RealNetworks execs claim a five-fold increase in the amount of audio and video delivered by the company. The war even increased subscriptions to RealNetworks paid services.
Theres no telling how many of those subscribers will stick around as the war winds down, but RealNetworks and its CEO have already proven adept at navigating rough waters. In the past few years, the company joined in the fight against what it perceived to be Microsofts anticompetitive practices and then watched as the same company launched a major streaming media initiative with Windows Media 9 Series. Microsoft and RealNetworks were once partners.
The broadband wave, swelling to 20 million US homes, could help float the fortunes of streaming media companies, so this seemed like a good time to chat with the man who started it all: RealNetworks CEO Rob Glaser.
LU: How has the release of Windows XP impacted RealNetworks bottom line, technology choices, and direction?
RG: Well, you know, basically theres a set of fundamental technology trends out there if you just step back. Theres the growth of bandwidth, and that is a fundamentally positive trend for us, because it allows us to deliver better and better experiences.
There is an increase in the range of devices that speak IP, be [they] mobile devices like the new Nokia 3650 phone that you can buy anywhere for $300 bucks [and that has] a full-fledged RealOne player in it, or these network devices that people are using to take MP3 collections and run them all over their houses.
Personally, I just got one of these Vonage IP phones. Its actually pretty cool. It comes with one of these Cisco ATA routers where you just plug an analog handset in.
In terms of technology trends, a new operating system like XP makes a big difference. It makes the PC more stable and robust, so you can be running background tasks as your PC operates effectively as a hub or a server in your environment. Those are positive dimensions of a new operating system.
Because Microsoft seems to sometimes not trust customer choice, they salt XP with all these little gizmos and trap doors to get people to try Microsoft stuff. But the reality is that were downloading more players than we ever have on a worldwide basis. Whatever the impact is of the courts saying what Microsoft should or shouldnt be doing with Windows XP, weve focused our business on continuing to deliver the best technology. Were increasingly focusing on a combination of enabling free services and keeping an eye on the growth weve seen in our premium services.
So our business is just fine. In terms of market dynamics, just look at the broadband trend and the growth in the wide range of devices. I wouldnt say were going into an era where PCs are irrelevant, and I certainly wouldnt say that to PC Magazine, but I think were going into an era where the PC is just one of a number of important devices. It plays a special role because of its programmability and extensibility, but when you look at the totality of whats going on with digital media in the mobile market, in the living room, in the home networking environment, theres more. Our focus is on the totality of that, with the PC as a core part of our heritage that were continuing to focus on.
As the landscape gets broader, the fact that we have partnerships matters. In fact, I was at the NAB convention last week showing our player running on the PlayStation 2, and running on the new Nokia phones, and on the new Palm Tungsten devices. Think of those three categories: the new game consoles, PDAs, and mobile phones. The leading manufacturers are people who are bundling our player, and the players are not running on a Microsoft operating system. My view is that the opportunities in front of us are very good, and well continue to more than hold our own on the PC.