Internet Outsider

Joost: The PointCast of 2007?

No startup has been more unanimously embraced (and hyped) by Big Media than Joost, the latest in a long line of (so far) failed attempts to bring television to the Internet.  Today, for example Joost announced a partnership with VH-1, in which Joost will premiere a new VH-1 series before it runs on TV. 

Joost is certainly slick, and its non-user-posted features are certainly friendlier to incumbent TV networks than, say, YouTube.  But do Internet users actually like it?  How many users does it actually have, anyway?

The Joost software that I beta tested reminded me of 1) television, which I like to watch at night and on the weekends but not at work, where I use the Internet most, and 2) PointCast, the bandwidth and processing hog that enjoyed a brief burst of buzz in the mid-to-late 90s before annoyed users began ripping it off their PCs.  For the sake of Joost fans (and Big Media), I hope Joost has a longer life than PointCast, but I haven't seen any numbers that persuade me that this will be the case.

Joost took the VH-1 announcement opportunity to note that it has "more than 500,000 users."  It's possible that this means it has "more than 500,000 regular viewers who use the service at least once a week", but it's also possible that this means "downloads."  Clarification here would be nice.  Some sense of a growth trajectory and churn would also be helpful: Is the 500,000 growing...or stable (or worse)?  Do new users use the service more as they get used to it...or do they try it out a few times and then abandon it?

I'm open-minded and would be glad to look at any data that can provide insight into Joost's future.  For now, however, count me among those who think the hype may exceed reality.

VUDU: NetFlix in a Box

One of the most successfully secretive start-ups in recent memory finally came out over the weekend...and now the promise of true TV-based VOD (anything you want to watch, whenever you want to watch it) seems a step closer to reality.  According to Brad Stone in the NYT, the VUDU TV box will allow owners to watch any of 5,000-plus movies instantly, instead of playing roulette on cable Pay-Per-View, waiting for Netflix discs to arrive, interminably downloading full-length films to their PCs, or, god forbid, driving to the video store.

The VUDU box apparently stores the beginning of all movies locally, which allows for the "instant" viewing, then downloads the rest from a peer-to-peer network of other VUDU boxes.  Owners pay about $300 for the box and then $6-$10 for each movie.  Several studios have already signed up to distribute movies through the box.

Thoughts:

• The future--a world in which TV and movie viewers are no longer "programmed" and, instead, can always watch what they want to watch--is, slowly but surely, arriving.  VUDU is the next step.

• Unlike YouTube, Joost, and PC-based movie-downloading services, VUDU is attacking a TV problem through the TV, as opposed to through the PC.  Downloading and watching movies on a PC will never be a big hit with consumer, and today's PC-to-TV solutions are klugy.  VUDU starts with device on which most movies will and should be watched: the TV.

• The early incarnation of the VUDU functionality, which will require yet another TV box and remote, seems clunky and inconvenient.  Sooner or later, however, the functionality will likely be built into other boxes (the way TiVo is/was).

• The early reported business model--$300 for the box and $6-$10 per movie--is not likely to be as successful as a subscription model (all-you-can-eat or a Netflix-like tiering).  Consumers hate to be nicked for every action, and the per-movie charge will discourage use, no matter how convenient it is.  (If Netflix users got discs for free but had to pay every time they used them, the service would be far less popular).

• This said, the movie studios that have rushed to sign on with VUDU would likely be more wary of a subscription model, and have likely forced the company to go with pay-per-view. The fact that the studios have signed up so fast is, on the one hand, positive: They are finally embracing some change.  On the other hand, the fact that they have signed up so quickly indicates that, from their perspective, the change may not be that radical.  Unlike analog media, digital media is a high fixed-cost, low/zero variable-cost business.  Monthly subscriptions would/will ultimately make far more sense for both producers and consumers.

 

Joost: Big Advertisers Love It. But Will Users?

ClickZ reports that Joost has signed three-month contracts with a group of 31 big brand advertisers, including Procter & Gamble, Coca-Cola, Nike, General Motors and Visa. It will offer these marketers traditional units such as :30 mid-roll spots as well as unique formats, including a small digital overlay ad. "The foundation is the traditional :30 spot, which we believe is far from dead, served on a mid-roll basis," said David Clark, Joost's EVP of global advertising. "We're inspired by others who seem to be able to make this work, like ABC for example."

JJ:  This is pretty cool.  We are witnessing an Interactive TV medium built from the ground up.  It all sounds good but I  haven't heard how they will get Joost into the living room.

HB:  The bigger question, I think, is whether Joost viewers will be willing to watch 30-second ads.  The Joost environment is already startlingly TV-like (see "Test-Driving Joost"), which is great for traditional TV programmers, but not so great for many Internet users, who don't like to be programmed (and who often watch online videos at work, where transforming the PC into a TV won't go over so well).  The reason "traditional TV spots" aren't common online is not that they don't work--it's that Internet users hate them.  So I think it's premature for Joost fans to commence an end-zone dance.