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FEATURE

Pay-Per-View: 1

Pay-Per-View: 1

January 13, 2006
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Will virtual reality boost the paysite market?
Yes, it will soon
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Yes, but in a few years
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No
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Out of 179 votes. Results based on votes submitted by members of XBIZ.net social network.

" We have truly entered the age of digital media distribution. "

Long before planned communities and strip malls devoured the landscape of Southern California and forced motor sport enthusiasts to abandon their speedways, motor sports legend Mickey Thompson set his sights on the long dirt roads of the Baja desert and turned this wilderness into the Southern California Off-Road Racing Enthusiast (SCORE), the Baja 1000 and the Baja 500.

Unlike many of his peers, Thompson was both a promoter and a participant in his events. I had the opportunity to work with Thompson during the early days and in just a few years, we accomplished much of what we had set out to achieve — including holding motor sport events in major arenas. However, the ability to produce television broadcasts still eluded us, even though the public was requesting more of these types of events. The networks saw little value in our four-wheeled circus and it became evident that the future of televised motor sports was at the mercy of the networks and the advertisers.

Cable television offered an alternative, and we were able to televise our events and find advertisers for niche broadcasts. In doing so, we found a way to enter the households of America using "sponsored programming," which changed television into a medium that could serve niche markets on an ongoing basis.

In 1998, I jumped at the opportunity to use a new broadcast medium: the Internet. Soon, we launched WebPayPerView.com, a television station that broadcast to personal computers around the world... or, so we thought. We had a studio, a few cameras we had purchased from a defunct TV station in Palm Springs and a ton of ideas. We thought since we controlled every element of the broadcast from production to deployment, no one could stop us.

However, our biggest obstacle was that nothing had been developed to support this online, pay-per-view model. We found that most billing systems were either too complicated or too expensive, and the content delivery networks were limited and costly. However, our biggest problem was how to build a PPV system.

Since our competition was the cable PPV TV market, we needed an edge. That edge was a vast library of niche content that could be viewed and ordered "on demand." Every time we had a great idea that could create more energy from investors, we found ourselves at a loss for an adequate solution to deliver that idea. In short, we could not create the on-demand, PPV scenario we wished to produce, since the much-needed resources did not yet exist.

If the resources we have today were available then, we might actually have made it. Now, new technologies and payment systems are easy to use and cost effective. These factors, combined with greatly reduced bandwidth costs, are allowing PPV models to pop up everywhere online.

We have truly entered the age of digital media distribution.

Power Of Downloads
The BBC recently reported that online legal music downloads now exceed in-store sales. In addition, broadband users make up 70 percent of the U.S. market. New technologies not only enable anyone to create, distribute and charge for rich media online, they've made it easy. Nonlinear editing tools, drop-in effects and digital photography equipment can make anyone with a couple of evenings to spare the next Cecil B. DeMille.

In short, if you have media-rich video or audio content, this is the time to put that content online using a pay- or charge-per-view model, which translates to a "cover your cost and make a profit" model.

Developing an online catalog is not only easier to do, but it also is a profitable way to create a new type of e-commerce website. By eliminating memberships, one can now utilize massive libraries of content that were previously limited due to constraints caused by excessive downloading. The key to this type of deployment is to create an encrypted content distribution model. You can achieve this by coding the content and thereby making it useless unless it is paid for.

We've seen for some time that more content means greater retention, but it also can mean higher bandwidth cost. As broadband usage continues to increase, so does the demand for more video and audio files, and the possibilities are endless. The way to start is to post old videos, random footage and new releases and build an archive of accessible media. Then take those videos and encode them into a well-compressed format and capture expressive thumbnails from the video. By placing accurate descriptions alongside those thumbnails, you can entice customers browsing your site. What's even better is that this model does not cost anything until someone purchases the content.

Start to build your technology by finding a good digital rights management (DRM) service provider that can easily integrate into a billing solution. DRM systems do far more than protect content, they also offer easy-to-deploy distribution models, integrated payment systems and controls and tracking mechanisms. Best of all, they are easy to use and can be extremely cost effective.

It is also important to make sure you select a service provider that is established and has the resources to stay around for a while. But most importantly, make sure the developer of the technology endorses the provider. In other words, if a DRM service provider offers a Microsoft Windows solution, check the Microsoft website to see if they are listed. The last thing you need is to spend the time and effort to encrypt your content with a provider who quickly closes shop, thus leaving your content useless.

In part two, we'll examine hosting solutions and more.

Randall Crockett is vice president of DRM Networks, a Windows Media Rights Management Partner that was founded in 2001. DRM Networks is a complete, turnkey application service that is fully E-commerce enabled and creates an easy-to-deploy, quick-to-market solution for the distribution of media content. For demonstrations and additional information about DRM Networks, visit www.drmnetworks.com.


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