Webcast Industry Focuses on Downturn

Providers say economy could hurt or hasten adoption of the technology

While there is little doubt the quality of streaming media has made significant gains in recent years, the current chill in the economy has led to mixed opinions about whether the downturn will hurt or hasten adoption of the technology.

Some within the industry say belt-tightening will work in streaming medias favor, offering enterprises the ability to reach employees and customers in a less expensive way. Others say economic woes have slowed the spread of broadband, leading some companies to offer streaming solutions that get around such bottlenecks.

"The industry is in a challenging phase right now," said Ashok Thareja, chairman and CEO of Orblynx Inc., citing last-mile issues, with some digital subscriber line providers in "retrench mode," and uncertain demand.

The satellite-based content distribution company has a streaming platform in use by a few customers but, so far, hasnt pushed the technology.

"Were looking to see when the economics start making sense to launch it globally," said Thareja, in Fairfax, Va. He estimated that about 8 percent of his companys international Internet service provider customers have asked for streaming services. "Were waiting for the economy to turn around. Our strategy is to be ready to take advantage of it," he said.

Those challenges have led startups and other companies to look to sidestep last-mile access problems.

Newcomer EnjoyWeb Inc. is trying to further streaming for entertainment purposes. Yangbin Wang, the companys chairman and CEO, said users expectations about quality are constantly being raised.

"Streaming media has had a lot of hype the last couple years," said Wang, in Sunnyvale, Calif. The challenge remains how to deliver high-quality video instead of "herky-jerky" images, he said.

Scaling up to millions of users at once is another hurdle. To avoid bandwidth congestion, EnjoyWeb is developing software that delivers content during off-peak times and can be cached at the users machine and replayed at any time.

"By no means has it lived up to its full potential," said Ray Harris, CEO of StarBak Communications Inc., a streaming-media appliance company in Columbus, Ohio. "This is a young child just starting to crawl."

On the flip side, Harris and other industry experts said they believe a slower economy may work in streaming medias favor.

"In a slightly slower economy, people are going to start looking for communication alternatives," Harris said.

StarBak makes a streaming-media network appliance called Torrent, which supports Microsoft Corp.s Windows Media, Apple Computer Inc.s QuickTime and MPEG. The company has a product called Torrent CE that turns videoconference signals into a Windows Media or QuickTime signal for streaming. Torrent CE allows anyone to participate in distance-learning classes without needing to travel to a videoconference-enabled classroom.

"Streaming video and streaming audio can provide some very, very specific solutions to increase your audience and reduce costs," said Patricia Kirkish, product director for interactive applications for Akamai Technologies Inc., in Santa Clara, Calif. Akamai Forum, released last fall, allows companies to put together large Webcasts with an average cost of $15,000 for a 1-hour event and an audience of a few hundred.

"What were offering is a product that can be justified as saving them a lot of costs," Kirkish said, citing travel and materials expenses that streaming eliminates. "Were not asking them to buy middleware and install anything. The networks are already in place."

Customers agree there are savings to be had through the use of streaming media.

"It makes it a lot easier for us to get our point across," said Shawn Garner, IT manager at CyberGroup Network Corp., in San Bernardino, Calif. The company has been a StarBak customer since last year.

But Garner added that bandwidth, as well as the economy, needs to improve. "Definitely, some companies are holding off because they can only do so much," he said.

One of the larger companies in the streaming business, RealNetworks Inc., of Seattle, has tried to overcome bandwidth hurdles and improve quality at the same time as a way to make streaming a more compelling medium. The companys RealVideo 8 and RealAudio 8 both reduce the amount of bandwidth required. Its RealSystem iQ, also released last year, is designed to avoid network congestion using "honeycombs" of interconnected servers.

"In the year 2000, streaming media became mission-critical for a lot of people," said Ben Rotholtz, RealNetworks general manager of products and systems.

"Whats still needed is achieving a level of scalability to reach audiences of Super Bowl size. Today, were confident weve got the right architecture," Rotholtz said.