Facts About The Digital Economy

Having information and facts at-your-fingertips about the internet and web is absolutely critical whether you’re a startup needing content for your pitch, a marketer needing to understand a 40,000 foot view of trends, a corporate user needing to understand mobile access to the ‘net or international usage, or if you’re just someone like me: an info-junkie who needs a constant data fix in order to constantly track what’s hot and what’s not.

This report is put out by the Progress and Freedom Foundation, an organization that is a “…market-oriented think tank that studies the digital revolution and its implications for public policy. Its mission is to educate policymakers, opinion leaders, and the public about issues associated with technological change, based on a philosophy of limited government, free markets, and individual sovereignty.

PFF’s research combines academic analysis with a practical understanding of how public policy is made. Its senior fellows and other scholars are leading experts in their fields, with distinguished careers in government, business, academia and public policy. Its research is substantive, scholarly, and unbiased.

Covered in the report are these key areas:

  1. The Growth of the Internet
  2. The Hardware Sector
  3. The Communications Sector
  4. Digital Media
  5. Electronic Commerce
  6. Threats to the Digital Economy
  7. The Worldwide Digital Economy

One of the best parts are the active links in each chapter’s EndNotes which allow you to drill down into many areas covered within this report.

Here is the download page and a direct link (PDF).

Broadband Providers: “Let’s cut ’em off at the pass!”

Even the most naive and casual observer can see that the threat from services like Hulu; both Apple’s TV and movie offerings within iTunes; Joost; and the accelerating number of media center software offerings (providing access to ANY video on the internet), pose a huge threat to the cable companies and other broadband providers.

They are all clearly trying to get out ahead of the user market (and the maturity of video provider business models as well as the open source media center software) and put caps in place before wider adoption occurs.

As a tail-end baby boomer with enough of a geek nature to be involved far too deeply in the ‘net, web and social media in my business, I realize I’m atypical within my demographic on how I, and as a result my family, use our Comcast broadband connection. With Comcast’s 50mbps down/10mbps up DOCSIS 3 setup in my office (Note: we were one of two companies in their Minnesota rollout of this new technology) and 16mbps down/2mbps up at home, I’m dealing daily in video, photos, moving around large Zip files, screensharing, personal publishing, and numerous other online activities. These activities are mission critical to our small business, my wife’s and my client interactions, as well as family activities and connecting with others.

Comcast, one of the largest providers in this space, directly affects all aspects of our digital lives. With my family and my current and increasing use of the internet for an every expanding array of online activities (Skype calling; my son’s video gaming; Flickr and Vimeo for photo/video sharing; online backup of our computers; use of our new Mac mini media center), we are certain to end up violating Comcast’s draconian 250GB bandwidth caps (er, I mean, Network Management Policy).

The kicker? According to Comcast’s executive escalation group, I can’t even pay them more for higher tiers of service with no cap or, as one representative told me in March, “…the cap is the cap, regardless of the tier of service.

Did you know that, in Comcast’s case, they can simply cut you off for exceeding that 250GB cap with no warning and that their promised metering tools are still missing in action?

Then I read this recently about Time Warner’s laughingly low caps and realized that, if Time Warner gains traction with this approach, Comcast will follow suit and we’ll all have to watch and do whatever these providers allow us to do online.

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TV is Toast: Mac Mini Media Center

My friends and family are sick of hearing me espouse the virtues of the Mac mini media center I built last weekend, but the experiences since have made me realize that TV as we know it is going to be toast much quicker than I thought even two years ago.

Though I considered AppleTV as one solution, it’s too limiting as it’s Apple and iTunes-centric. Instead, I am using PlexApp, an open source media server forked from the XBox Media Center (XBMC). I’ve downloaded and am playing with Boxee as well, which is positioned as a social media TV platform so friends can see what each other is watching or has watched. 

Using this has profoundly shifted our use of our HDTV. From my watching of HD shows from Revision3 to Hulu shows as well as those from Joost. It’s been fun to get hooked on an old science fiction show with my son as well as my wife who discovered several shows she watched many years ago and is delighted to view again.

We can even bring up DVD’s I’ve backed up to the 1TB external drive which is also increasingly holding all the video I’ve shot over the years (and never pulled off the miniDV tapes). In addition, my multiple gigabytes of photos will end up there as well as all of our music.

iTunes? Yep. We can leverage all that it has to offer from movie rental or purchase to podcasts to music.

The best part is the ease with which developers can create plugins that bring other video sites to Plex. In the works are CBS and ABC ones and more.

Why is TV toast? Because even Comcast cable can’t compete with the on-demand capabilities (and MUCH better user interface than the embarrassingly bad one they offer) of apps like Plex and the ecosystem that has already exploded around it. Yes, they can try to slap us around with draconian measures like their 250GB cap to stave off the inevitable move away from what they offer, or do what I view as the smart thing: embrace these moves, help the development of Plex, Boxee, XBMC and others, and be the preferred delivery method for it all.

So I’ll keep moving along with what we’re doing and hope I’m not exceeding the cap. NOTE: I did ask recently — when on with Comcast’s executive resolution center — that even paying more for a business class account is still subject to that 250GB cap. Weird.

Brightcove: Betting your business is a crapshoot

One of my favorite video platform plays, Brightcove, clearly was torn for some time between going elephant hunting (trying to capture big media players) vs. the user-generated YouTube-type crowd (with Brightcove.tv) and the rest of us just lost:

Beginning December 18, 2007, we plan to end support of direct consumer uploads to Brightcove.TV.  As a result, you will not be able to upload new videos to Brightcove.TV after December 17, 2007. But videos you have already uploaded to Brightcove.TV will remain available on the site and through your Brightcove.TV channel.  Videos you have embedded in other sites and blogs will also continue to play. (Read more in this writeup at ReadWriteWeb).

Here’s the problem: If you’re a startup, small or even medium sized business unwilling to spend “thousands per month” for a platform play (as Brightcove has repeatedly told me in response to my inquiries about their business accounts) who do you bet your business on in the video space? Veoh? Kyte? Mogulus? As it stands now, I wouldn’t trust any of them to provide an “on ramp” to build a video-centric business unless my client had deep pockets and could enter into an agreement guaranteeing a service level.

This is too bad since there are a lot of content producers searching for a platform upon which to build their businesses or expand their current ones. It’s also unfortunate for the Brightcove’s of the world since there’s a dwindling supply of elephants to hunt.

What if a 1% increase in broadband penetration equaled 300,000 jobs?

Often I take Robert X. Cringely‘s columns with a grain-of-salt, but this one entitled, “Game Over: The U.S. is unlikely to ever regain its broadband leadership” really hit me since I make my living on Internet-centric management consulting and view broadband as the key enabler of business going forward. Cringely’s article is an important one to read if you care about US competitiveness in the future.

Back in the mid-1990’s I had an ISDN line with a whopping 128kbps access for $69 per month. Incredibly fast at the time, I even considered their bonded option for 256kbps (well over $100 per month) but I wanted to stay married. Today I have 8mbps per second downstream and 768kbps upstream for essentially the same price.

I have friends in San Francisco with 10mbps symmetrical (both upload and download) for under $100 a month. Others using Verizon’s fiber (FIOS) and getting 15mbps down, 2mbps up for $50 per month.

But Cringely talks about the 100mbps speeds in Japan, others have complained about them being ahead of us too and the OECD’s April, 2007 report (which showed the US at 25th in global broadband penetration and speed) is open to debate. So is it important for us to have competitiveness in broadband speeds and why aren’t we — the inventor and creator of the Internet — in the world’s leading position for broadband speed and penetration?

When you think about the relative sizes of countries vs. US states, you begin to get a feel for the enormity of the problem. Japan is roughly the size of Montana, for example, and (as of 2001), 79% of the population lived in urban areas with ~20% in Tokyo alone. That makes it considerably easier to provide a high speed broadband infrastructure for the overwhelming majority of Japanese. It’s a lot tougher to do so across the vast geography that is the United States.

The stakes are too high, however, to NOT solve this accelerating need for true broadband. ArsTechnica has a good article on House Democrats and discussions about ‘true’ broadband. I’m not even going to get into the lobbying and politics of broadband, telephony and wireless, but suffice to say there are alot of complexities on why we’re NOT the world’s leader. What most discussions don’t focus on, however, is that broadband is viewed as a driver of gross domestic product (GDP) output and we need to be accelerating the Internet — both in speed and penetration — now.

What if a 1% increase in broadband penetration equaled 300,000 jobs? Read on for a very interesting set of data…

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Will Apple’s Safari become a rich, Internet application container?

When Steve Jobs put up the slide at the Worldwide Developers Conference (WWDC) last week that the Safari browser would be available on Windows, there was interest but not much discussion in the blogosphere of why Apple would do it. Some thought it was stupid to try and fight the browser war on Windows.

I see the logic of it and think it’s stealthy, clever and absolutely brilliant. Here’s why…

Apple announced at WWDC that there are currently 500 million active users of iTunes. Every iTunes installation has Quicktime in it. Thinking about the huge install base of Quicktime for some time, I’ve been puzzled why Apple wasn’t taking advantage of Quicktime as a delivery mechanism for cool online-n-offline functionality that is being delivered by Adobe’s AIR and Microsoft’s Silverlight.

But then Steve Jobs shows Safari on Windows and I had one of those forehead-slap moments and a “Doh!” utterance: Safari will be the rich, internet application (RIA) container, not just Quicktime alone!

In his keynote, Jobs emphasized over-n-over again that “the iPhone contains the exact same version of Safari as this one” when describing Safari 3, played up strongly that this same Safari runs on the iPhone and that developers can now create apps for the iPhone by delivering them inside of Safari!

Check out this at the 37Signals blog where Jason says, “That is a bold idea. Very forward thinking. A whole new product with the opportunity for a whole new platform. But instead Apple chooses simple and familiar: HTML and Javascript. Tens of millions of developers already know it. Instant developer uptake and an instant batch of apps that likely already work with the iPhone.” Then look at the first comment which says, “I fully agree. And these are scary times for those who try to push RIA  technology like Flex and Silverlight.” (Note: John Gruber has a much different take on Apple’s positioning of writing Web apps for the iPhone with Safari, “It’s insulting, because it’s not a way to write iPhone apps, and you can’t bullshit developers.

But it gets better.

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My Live TV Adventure…

Delivering live TV is always an adventure, but even more so when everything you’re using is free and the sheer act of using it is stepping out onto the ledge with a 20 story drop in front of you!

Last Friday evening, Malcolm Cohan delivered a live webinar to ~20 or so people that I set up (this screenshot above is from a later date and it’s only me in the chat room) scattered all over the US, London and Germany.

Though I’m not a developer, I knew what we were trying to achieve for Malcolm and that we’d be out on the bleeding edge a bit using the beta of this awesome video production platform, Mogulus, along with Malcolm’s incredible energy and his TV production background. The screenshot is of a web page for this first small event. I embedded the Mogulus player as well as live chat with a Meebo room I signed up for and also embedded in the page. The whole page was under 100k since the functionality was hosted elsewhere.

We set up lights, the shot with Malcolm with windows behind him, a microphone and mixer and a separate prosumer camcorder on a tripod so the video quality would be good. He ran the Mogulus platform and cued up videos he’d uploaded previously (which was really cool) so he could play videos and insert them directly into the live stream. I modulated the audio as I watched and listened (and recorded) the live stream to ensure that our audience was having a good experience.

When I wrote this post about Mogulus a couple of weeks ago I hadn’t yet used the platform. After our experience last Friday, I’m absolutely stunned with what power this brings to deliver Live TV *and* 24/7 playing of videos (which, by the way, is perfect to do before the live segment begins). I’m also acutely aware of my scale discussion since I could only imagine a hot show with thousands of people (or multiple tens of thousands) logging on to view and crashing the Mogulus servers. It could be ugly and there really isn’t any way to predict if a Mogulus, uStream or Stickam could even handle large scale events.

This was not without hitches. One person viewing didn’t have enough bandwidth (slow DSL connection) and another saw only a black square instead of the video (he didn’t have a current Flash install) so there are still hiccups which browser sensing could help overcome (to check bandwidth and look for the correct version of Flash).

The other piece to this is what you see above. Look-n-feel is important. I want to pay for a branded, skinned player that is mine and a branded, skinned chat room that works great (because of Internet latency of multiple second delays, chat is currently the best method of interacting with an audience). I also don’t want to pay more for monthly access to a live streaming platform than I do for my office space (most of the big providers: WebEx, Adobe Connect, charge hundreds or thousands per month) or have anyone insert their advertising into my live or recorded streams.  Bandwidth use as live TV shows take off and scale is going to be the #1 issue any of us who are dabbling in these technologies will face. Still, doing this event with Malcolm just made me grin as to the possibilities!

Live TV on the Internet

Searching for innovation in live, streaming video brought me to Mogulus last night. I’ve been enamored with uStream, Stickam and BlogTV but realize how limited and “Webcam-centric” they are currently.

Since Mogulus is in beta right now, I’ve not yet had a chance to put it through its paces. Viewing the video, going through this online presentation (that had too many people in it which caused a hiccup on Adobe’s servers), looking at the screenshots absolutely blew me away.

Here’s what excited me about this service:

a) The capability to deliver a live show with graphics, over-the-shoulder images like the news, crawls and more which look professional

b) Having multiple other people — all connected through their own webcams or cameras — allows a host or producer to switch between “feeds” instantly (“…and now let’s go to our correspondent live at the conference…”)

c) In advance of a live show, a storyboard can be created of assembled videos that can be in the queue and inserted into the live show at the click of a mouse

d) Assembled content can be delivered sequentially so a “channel” or “station” you create can broadcast programming 24/7. This meets the old broadcaster mantra of “no dead air” on a channel, but archived content needs to be available on-demand and I didn’t see how Mogulus could achieve that for viewers.

Just days ago I wrote in this post:

I’ve brought up scale over-n-over again on this blog and I know that streaming video is really hard and the bandwidth needed is expensive. What if a hot ‘show’ is streamed on Stickam or uStream and has even 1% of the disappearing network TV show audience (37.5 million viewers in the US in March for broadcast networks), there is NO way that any of these lower end solutions would be up to the task of streaming to an audience of 375,000 people…let alone millions.

When individuals, companies or organizations start down a path of choosing superior communication technologies, they are placing a bet. I view many solutions — Skype, Stickam, uStream, and many Web 2.0 solutions — are bleeding edge and not a safe bet.”

If you have a small audience, no problem. An important event that you need to have rock solid and guaranteed uptime? I wouldn’t use any service that wouldn’t provide me with an SLA (Service Level Agreement guaranteeing service parameters).

Mogulus will be one to watch as will similar live streaming offerings coming from Brightcove as well as the recently announced Flash streaming service from Akamai (more info here and a video with Akamai’s streaming product manager here).

Figure out right now how you’ll be delivering live TV over the Internet starting this Fall or expect that this time next year you’ll be kicking yourself you didn’t start sooner!