Reed Hastings, CEO of Netflix, is a smart chap. He recently posted a hefty presentation on SlideShare. It provides several great lessons for those in the Video E-commerce industry. Let’s check ‘em out.
(1) DVDs Will Go Extinct

We talk a lot about the end of DVDs. If there’s any question, visit your local Blockbuster.
Is it dead, yet? Try to stay out of the DVD business come 2030.
(2) Streaming. Streaming. Streaming.

It’s simple. Get out of the DVD business. Get into the streaming business.
(3) Dominate Your Segment/Content Type
This is a valuable lesson for media companies of all sizes. If you sell videos and want to
create a video store dominate one segment first.
(4) Piracy Sucks (and it isn’t going anywhere)
We believe the affordable, easy to use solutions help beat piracy. A good example of this is iTunes. However, it’s also important streaming and distribution companies (including Vidli) roll out the cannons to protect digital content. Pirates aren’t going anywhere.
(5) Cable is still the Giant. Darn.
Mark Cuban thinks the key quote of this presentation is on page 26 – ”
almost no customers leave cable for netflix.” Yes, that’s true, except one of Vidli’s co-founders (
Michael Murphy) who left cable for Netflix over a year ago. Haha…
So, we think the key quote is actually on the last page. “Innovators Needed.”
Full Presentation

This may be a little shocking for you. When video is delivered via progressive download, it can be saved as a digital file. We’re talking about the exact same file you created! So anyone watching your progressively downloaded video can save the source file – all he or she needs is the right software tool. These sorts of tools can easily be found on the web – for FREE! YIKES!
So at Vidli we took a long hard look at this. Before ever licensing a single video, we realized we had to help you with video piracy.
“It’s probably helpful that you know that most of the video you watch on the web is delivered via progressive download. That’s the kind of video that can easily be saved. YouTube is the best example. 100% progressive download. While the video is viewed, the video file is downloaded to the cache of the machine viewing the video where it remains until the cache is deleted. Here’s an interesting fact: Go back to a website and watch a video previously viewed and chances are good the video is playing from the cache and not from the site. In fact, after the first viewing, videos downloaded to the cache play from the cache every time they are viewed – that is until the cache is deleted.” (Wes Moore – source)
The thing is most people use “streaming video” when referring to all video we watch on the web. In reality, it’s totally different than progressive download. True streaming video does not download to the cache of the machine playing the video. Because it does not download, it cannot be saved. So that’s a HUGE first step for people who are serious about protecting their digital assets.
So long story short, we’re launching Vidli using real “streaming video”. We’ve loaded up Vidli with some special technology to help further protect the stream. We’re keeping this information confidential for now but if you’re interested to know more reach out to us.
That said, this is not a video protection utopia. Any computer monitor can be screened captured and there’s very little we can do about that right now. But a screen capture is low quality and is nothing like the digital file. “As is the case with most things in life, there is one downside to using streaming video as a delivery method. Unlike progressive download, which uses the familiar HTTP protocol, streaming video uses Adobe’s RTMP protocol. The hazard there is that some larger businesses and government organizations have firewalls that prevent RTMP sources to penetrate their firewalls. In the case of a firewall, the video will never play and the screen will remain black and empty.” With Vidli we’re not too concerned about this. ( source)
We’ve received a lot of feedback as we prep for launch. People want to know if Vidli will provide a download option for the license. That’s a great question! To clear things up this has nothing to do with progressive download. That is a form of delivery. A download option for a video would actually allow someone to download your media file – much like iTunes does for music files.
To help us build something that is incredibly helpful for you we need some feedback around this concept. We’re thinking it would be an option (as in an additional check box) that you could select to make your video file available for download. It would then appear as a purchase option on the video detail page. In some cases it makes things easier and better all around. Currently, we’re thinking it sounds like a helpful and spiff idea. So we’re headed in that direction, but not for awhile. Ultimately we’re here to help you protect video right away. And streaming helps us to that immediately. Our mission is to make Vidli a better product. So if you have thoughts about a download option let us know what you think.
A Big Booby Thank You to Wes Moore! His article rocks!
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