HomeChoice VoD Hits 15,000 Subs, Reach Doubles to 2.4m

HomeChoice STBVideo Networks Ltd (VNL) has announced that it’s broadband and Video on Demand (VoD) service, HomeChoice, now has 15,000 subscribers, since its relaunch in last September.

Eight in ten of their customers have also signed up to the company’s ‘triple play’ package that consists of broadband-delivered TV, broadband and voice calls.

It’s also taking this opportunity to announce that it’s going to be doubling the number of homes it can reach to 2.4 million in London and the Stevenage area, up from 1.2 million.

The VoD component of HomeChoice lets subscribers choose from over 1,000 movies, over 3000 music videos and hundreds of hit TV series, all available to watch exactly when you want.

“The concept of broadband delivered TV and VoD is very new to the entertainment-buying public and to already have 20 per cent market share of new DSL subscribers in our coverage area so soon after our launch is a great achievement. This gives us the confidence to significantly expand our network”, said Roger Lynch, Chairman and CEO VNL Ltd.

VNL initially made inroads into launching its phase 2 footprint in December 2004 when it enabled five new exchanges, including Stevenage – its first exchange outside of the M25. By ‘unbundling’ the exchange, called LLU (Local Loop Unbundling) in the trade, Homechoice is able to provide customers with a 6.5Mbit connection. 2.5Mb are used for TV and VoD delivery, and up to 4Mbit for Internet connection.

The company’s major marketing push for the re-launched HomeChoice service began in September 2004. During Q4 of 2004, VNL was responsible for one in five new DSL net additions in its initial launch footprint of 1.2 million homes.

The company has continued to build on what it offer its subscribers. In August last year, HomeChoice signed a retail deal with BSkyB enabling its subscribers to watch Sky Sports and selected Sky Movies channels on the service. It has also added telephony to its offering, and is about to launch a music download service that will allow HomeChoice customers to buy downloadable music tracks as they appear on screen. It also plans to double the speed of its broadband service from February, at no extra cost: 512Kbps will raise to 1Mb, 1Mbps to 2Mbps, and 2Mbps to 4Mbps.


Real Networks Results, Sales Up but No Profit

RealNetworksRealNetworks is enjoying record sales that have helped the Seattle-based Internet company to trim its fourth-quarter loss. The announcement comes amidst its ongoing cost of litigation against rival Microsoft, with whom it’s suing in a billion-dollar case for unfairly promoting its own media software.

The company reported a net loss of $1.0 million, or 1 cent per share, for the fourth quarter, compared with a loss of $5.3 million, or 3 cents per share, a year earlier. According to RealNetworks’ CEO Rob Glaser, the company’s improved sales have resulted in an increase in ad-supported revenues ($19.1 million of revenue in 2004, up from $8.2 million in 2003), mainly due to a better Google relationship. Its Comcast relationship (on the music side) is going very well, and Video/SuperPass now has lower content acquisition costs.

The company has also discontinued CNN and Nascar video offerings to focus on more profitable products, and noticed a secular trend going on – the move to digital music – in which it will participate in the overall category growth, along with Apple. RealNetworks is also no longer counting on university subscribers.

RealNetworks has been aiming to reach profitability, excluding litigation costs, by the end of 2004, and said it expects to be profitable on the same basis throughout 2005. For 2005, RealNetworks expects revenue to grow 16 to 20 per cent over 2004 with revenue of $266.7 million. Other Q4 highlights include music revenue grew 172 per cent to $21.6 million from $7.9 million in the year-ago quarter, revenues from games sales and subscriptions grew 156 percent to $10.1 million from $3.9 million in the year-ago quarter, although video and consumer software and other revenue was down slightly to $29.1 million compared to $29.3 million in the year-ago quarter.

Paying subscribers to Rhapsody music and premium radio services increased to over 700,000 from over 625,000 at the end of Q3 of 2004, and ad-supported Web services garnered $19.1 million of revenue in 2004, up from $8.2 million in 2003. What’s also helped the company is that Internet video streaming was up 80 per cent in 2004, with 14.2 billion video streams being counted worldwide over the year, according to a new report by AccuStream iMedia Research. The number of video streams last year was up by 80 per cent compared to 2003.

Real Networks

Wireless Headphones Possible with Aura’s NFC LibertyLink LL888

Aura Libery Link LL888Aura Communications has announced the first samples of its LibertyLink LL888 system-on-chip, for enabling high-quality wireless voice and stereo audio. The chip provides wireless stereo headphone capability for MP3 players, portable DVD players and audio-capable mobile phones – or indeed virtually any portable product where digital audio performance must be coupled with long battery life and low cost. The technology was previewed in ‘real life’ earlier his year by Creative Technology, whose wireless-enabled Zen Micro MP3 player is based on the LibertyLink LL888 chip.

The most interesting feature of the LibertyLink LL888 is that it uses a patented form of Near Field Communication (NFC) rather than conventional radio frequency technology (such as Bluetooth) to enable digital audio wireless performance. NFC is a short-range wireless connectivity standard that uses magnetic field induction to enable communication between devices when they’re touched together, or brought within a few centimetres of each other.

Jointly developed by Philips and Sony, the standard specifies a way for the devices to establish a peer-to-peer (P2P) network to exchange data. After the P2P network has been configured, another wireless communication technology, such as Bluetooth or Wi-Fi, can be used for longer range communication or for transferring larger amounts of data.

Unlike Bluetooth, which radiates in the crowded frequency band at 2.4GHz, Aura’s technology is more private and secure as it operates at 13.5MHz – it completely avoids the interference of the 2.4GHz band. Aura Communications claims that the chip’s magnetic signals creates a ‘secure communication bubble that surrounds the user and is uniquely owned by each user for reliable and private communications.

The chip is currently scheduled for production quantity availability by the second quarter of 2005, with pricing set on an individual customer basis, but expected to be under $5 (US) in OEM quantities.

Aura Communications

Video/TV Search Beta Launched By Google And Yahoo!

Google VideoGoogle has added another product to its long list of extended beta services. Google Video is a TV video-search service that searches the closed captioning content of television programs – from major American TV content providers including PBS, the NBA, Fox News, and C-SPAN, among others – to return still photos and a text excerpt at the point where the search phrase was spoken.

Google Video also; displays a preview page of up to five still video images and five short text segments from the closed captioning of each programme; lists when a particular programme will next be aired in a given area (US only); and allows for searches within a particular show.

Transcripts are available, but not video clips. This service is another milestone as it broadens the company’s strategy of expanding search to information on and off the Web, and it takes it into a market where more advanced services have been available for years.

“What Google did for the Web, Google Video aims to do for television,” said Larry Page, Google co-founder. “This preview release demonstrates how searching television can work today. Users can search the content of TV programmes for anything, see relevant thumbnails, and discover where and when to watch matching television programmes. We are working with content owners to improve this service by providing additional enhancements such as playback.”

Not to be outdone, US-based rival Yahoo! has also launched a video search link on its home page. The Yahoo! service searches and returns actual video clips for playback, but does not offer transcripts. Google and Yahoo!’s video searches are interesting launches, but they do not match those of video search services currently available on the Web. Examples include Blinkx.tv and SpeechBot from Hewlett-Packard, which uses speech-recognition in its search, and ShadowTV, which offers a paid business service. Nevertheless, when a leading search engine company enters a new market, we all know something big is going to happen.

Google Video

Music Download Giant Napster Considers Film Service

napster provide filmNapster, one of the largest players in music downloads, is considering offering a film download service. The new service would sit alongside its music offering and help to give the company a competitive edge over its rivals. The technology is already in place to download movies, so the same service model could easily apply to films, television programmes and video games, now that broadband connection speeds are getting faster and more prevalent.

In a move targeted at the younger video-game generation, Napster won’t be the first company to enter the legal movie download market. In the US, MovieLink and CinemaNow are already offering a service to a growing customer base in America. Films on these sites start at around $2.99 (£1.59 Euro 2.29). However, similar to the music industry five years ago, the film industry is struggling to keep piracy at bay with technologies that allow movies to be downloaded quickly and in full to users with high-speed Internet connections. The Motion Picture Association of America has already filed lawsuits against pirates and is cracking down on distribution networks such as eDonkey and BitTorrent.

Regardless, legal film downloads will be a winner and are the future – just like audio downloads. Since broadband, film downloads have surged considerably, and around one in four people online have now downloaded a film, according to the MPAA. Such statistics have encouraged Napster and others to keep an eye on the market.

Since Christmas, Napster UK has reduced the price of its entire music catalogue of over 1 million tracks by 20 per cent. In response to record sales, the more aggressive pricing strategy will mean that full albums now cost £7.95 (US$14.89 Euro 11.43), while individual tracks cost 79p (US$1.48 Euro 1.14) when bought by Napster subscribers or purchased with Napster Pre-Paid Cards and Online Music Vouchers. Pricing for movies has yet to be announced, but it’s obvious they’ll have to be a lot cheaper than the latest DVDs for the service to takeoff.

Napster – UK
Napster – USA

EU Software Patent Causes Controversy

Plans to introduce European-wide laws on computer software patents have caused controversy because of the impact they could have on the cost and availability of commercial and open-source software. Microsoft chairman Bill Gates put the case rather more strongly, describing opponents of the legislation as ‘modern-day sort of communists’ who want to damage industrial innovation.

The software Patentability of Computer-Implemented Inventions aims to clarify existing European laws on patenting software, but could create legal hurdles for IT departments wanting to develop their own software. In the worst-case scenario, the patents could force smaller suppliers and open-source specialists out of business, restricting competition and the choice of software available to users.

To be patented, software has to have a ‘technical application’. This basically means that a company that develops software to control a DVD recorder can patent it, as controlling a DVD recorder is a technical application. However, a company that develops software to automate an accounting system would not be granted a patent. This is because accounting systems are regarded as a business process rather than a technical application. The whole process is governed by European Patent Convention, an international treaty which has so far been implemented in slightly different ways in each country.

The bill has sparked a debate on whether the EU should follow the US model of granting patents to Internet business methods, such as online bookseller Amazon’s ‘one-click shopping,’ or instead restrict patents for computer software. Poland, a large EU member whose backing is crucial for the adoption of the proposed rules, told Reuters last week that it was not ready to back the legislation amid fears it could open the door to the patenting of pure computer software.

The major benefits of the bill is that it would provide European companies with protection for their ideas and encourage innovation, create a level playing-field for patents across all European countries, and clarify existing patent laws, rather than introducing major changes. However, small suppliers will not have enough financial muscle to obtain and enforce patents, thereby reducing choice for IT departments. It could also restrict the availability and functions of open source software, and IT departments may have to conduct patent searches to make sure they are not infringing rights. The saga continues, with adoption of the bill now scheduled for next week.

China Develops its First Digital TV Chip

China Digital TV ChipShanghai-based Fudan University has developed the country’s first home-made digital TV chip. Not only that, but the chip has passed appraisals by experts from the Chinese Academy of Sciences and Chinese Academy of Engineering, and it’s outperformed European and US standards in terms of sensitivity and anti-jamming capacities – at lower costs.

The ‘Zhongshi No.1’ chip, which is based on China’s DMB-T standard and is made by Grace Semiconductor Manufacturing and Semiconductor Manufacturing International, integrates more than 70 storages, 2 million logic gates and 20 million transistors. It’s expected that the mass production of the cost-effective chip will help to boost China’s digital TV industry as it will pave the way to a new generation of high-definition televisions (HDTV).

Apparently, dozens of electronics makers have integrated the new chip technology into their products, including Changhong, TCL, Skyworth and Haier. China’s Henan Province has applied the new technology to launch mobile TV programs, and other localities have reported success in trial operations. US-based Time Warner has also announced that it plans to offer subscription-based digital TV programs to China.

According to official statistics, China has more than 370 million TV sets and an average 40 million sets are being sold each year. China plans to broadcast the 2008 Beijing Olympics on digital TV and hopes to roll out the service nationwide by 2015.

Philips Sells Total Holding In Vivendi Universal

Royal Philips Electronics has sold its total holding of 32,265,561 shares in Paris-based conglomerate Vivendi Universal. The transaction, which closed yesterday, will provide Philips with proceeds of approximately 720 million euros, and will result in a non-taxable gain of approximately 300 million euros in the fourth quarter. Prior to this transaction, Philips’ holding represented approximately 3 per cent of Vivendi Universal’s outstanding shares. Philips’s share prise rose 1.1 per cent after the announcement, while Vivendi shares fell 0.7 per cent.

The initial combination of the companies was believed to lead to the strengthening of all parties involved, including Philips and its shareholders, by creating a global powerhouse in entertainment and services in the new economy. Philips was a set-top box provider for Vivendi, with whom it supplied to Vivendi’s Canal+ division. Philips has not commented further on why it has sold all of its holdings

Vivendi Universal which began as a French civil engineering enterprise, grew to absorb the Universal entertainment conglomerate in the US and then sold or spun off most of its media acquisitions after investors lost patience over rising debts. Restructuring since 2002 has reduced Vivendi to a much smaller, but significant French film, television and telecommunications operator. The company was expected to drop the ‘Universal’ part of its corporate name in 2003 after a deal that transferred its US film, theme park and cable television interests to a joint venture with NBC-owner General Electric.

In 2001, Vivendi Universal and Sony launched ‘Duet’, an alternative to Napster. The service sported monitoring of what’s downloaded and listened to, better sound quality, a subscription service, and pay-per-listen options. ‘We hope to license 50 per cent of the world’s music’, said a company representative. To kick-start the venture, Vivendi Universal purchased MP3.com for about $350 million, a move that followed Napster’s deal with media conglomerate Bertelsmann. Both deals marked a critical moment of détente and an admission that the labels needed the help of their one-time enemies, as they got serious about online distribution. Unfortunately, that dream failed too.

Vivendi Universal

MPAA Judge Finds ‘bulldozer’ approach ‘improper’

Last week, members of the Motion Picture Association of America (MPAA) filed 11 lawsuits against hundreds of people they accused of using file-sharing networks to share infringing copies of movies. However, the Federal Judge ruled the ‘bulldozer’ approach improper, ordering that the case should be put on hold for all but one of the defendants.

The move by the MPAA to group defendants into arbitrarily-joined actions was probably thought of as a ‘neat’ and easy way to get the message across to other US citizens participating in file sharing. ‘Bulk’ suing could also save a heck of a lot of paper shuffling and administration work.

The MPAA sued groups of “Does” (John Doe) identified by numerical IP address and requested the discovery of names from the users’ Internet Service Providers (ISPs). However, Judge William Alsup ruled that because claims against the 12 defendants were unrelated, suing them together into one big case was improper. “Such joinder may be an attempt to circumvent the filing fees by grouping defendants into arbitrarily-joined actions but it could nonetheless appear improper under Rule 20,” the order states.

The Electronic Frontier Foundation (EFF) has filed friend-of-the-court briefs, objecting to similar misjoinder in many of the cases filed by the Recording Industry Association of America (RIAA) against alleged infringers.

“This decision helps to give due process rights to the Internet users accused of infringement,” said EFF Staff Attorney Wendy Seltzer. “Lumping them together makes it more difficult for everyone to defend against these claims.” EFF is also concerned about the movie studios’ failure to produce evidence of infringement against even Doe #1 in this case.

In a separate case, Warner Brothers Entertainment has secured a $309,600 judgement against an actor for allegedly making promotional ‘screener’ copies of ‘The Last Samurai’ and ‘Mystic River’ available for bootleg DVD copying and unauthorised Internet trading.

Carmine Caridi, a former recurring actor on ‘NYPD Blue,’ is accused of copyright infringement and is facing a default judgement of $150,000 per film and $9,600 in attorney fees. Caridi and co-defendant Russell Sprague were caught because the screeners were individually watermarked for each recipient.

According to Warner Brothers, Carmine Caridi, as a member of the Academy of Motion Picture Arts & Sciences, signed an agreement before he received the 2003 awards season screeners promising not to circulate them. It is believed that he immediately sent the VHS screeners to another address where they were copied onto DVD and converted to digital files that were posted on the Internet.

BT And Blueprint Jointly Develop Innovative Music Distribution Service

In yet another move in the legitimate digital music market, BT and Blueprint have jointly developed a new service based on Blueprint’s Open Royalty Gateway (ORG) and Song Centre software that allows copyright holders to take more control of their material.

The new service for hosting, managing and distributing music and related content online, promises to accelerate the growth of the market by addressing key problems hampering the development of online music businesses, such as time to market, copyright protection, capital expenditure in IT and networking technologies, control of rights and the margin structure of the present models.

BT brings to the table IT, networking and data storage knowledge, while Blueprint offers experience in media management software and music industry relationships. Blueprint will provide the software framework and industry interface, with BT utilising its digital content hosting platform and international network to deliver a global reach.

The solution enables rights holders – artists, writers, publishers and record companies – to host their songs, videos, ringtones and other digital media files while having a direct commercial relationships with retailers. Content can be delivered directly to any number of media-enabled devices, including PCs, digital audio players and mobile phones. Of course, online-only distribution also dramatically reduces the time it takes to get digital files to market, but the system has to be successful in managing rights and digital licences, reporting royalties and sales to rights holders, and offering a wide variety of digital media to consumers using variable pricing structures.

An interesting feature of ORG is that it allows rights holders to actively manage their content, including setting business rules for pricing and location, electronic contract creation, sales tracking and royalty reporting. In addition to handling ‘major label’ music content, ORG allows independent labels and artists, many of whom control their own rights, to encode, package and upload their content to the service and then manage contracts. Blueprint will also work with retailers, letting them mix and match content to create their own offers and campaigns through a service called Song Centre.

On the other hand, the service could, however, let artists or smaller labels bypass the majors and sell their music directly to retailers or consumers. Referral and reward programmes, using viral recommendation, also means that consumers can earn back the cost of the music they purchase, by rewarding them with a commission each time one of their friends buys recommended content.
The service has already been used by EMI for Robbie Williams’ recent No.1 hit single ‘Radio’ with Australia and New Zealand’s leading music retailers, Sanity and Sounds. Audio, video, visual and mobile content was bundled together for sale, and linked into a competition utilising Blueprint’s referral and reward technology to drive additional opportunities to win prizes. The service is now powering the global Robbie Williams ‘Greatest Hits’ digital download store.