Australia gets Flash web video on demand service

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Two veterans of mega-portals Yahoo!7 and ninemsn have formed a new Australian startup to launch online video on demand services in competition with new offerings from Telstra, FetchTV and more.
Dubbed Juno Interactive, the company has been formed by ninemsn’s former head of video Jimmy Storrier — who left the web giant in March — and Yahoo!7’s former head of media production David Morrison.

In an interview earlier today, Storrier said the pair were planning by the end of this year to launch an online video on demand service exclusively in the Australian market that would make content such as television shows and movies from major studios in the US and Europe as well as Australia available online locally for streaming viewing, with a beta to go live in late July or August.

Unlike rival offerings from FetchTV and Telstra (through its T-Box), which will be tied to subscribers’ broadband connections, Juno Interactive’s video on demand solution will be streamed through a web browser to customers using any internet service provider. It will use Adobe’s Flash technology, with built-in digital rights management technology that will allow users to watch the content for a certain time (usually 24 or 48 hours) after they’ve paid for it.

“We’ve always wanted to make this available to as many people as possible rather than limiting to a certain box or ISP,” Storrier said, noting the technology would work on PCs, Macs and so on, with plans to eventually extend it to other devices such as the iPhone.

However, the platform will be limited to Australian IP addresses, although Juno is checking out the potential to offer it in the New Zealand market as well.

Storrier couldn’t disclose pricing on the service yet, although he noted subscriptions would be available (pricing models will be tested with the beta). “The back end is geared up for advertising,” he said, but he added Juno didn’t believe there was currently a big enough local video advertising market to build its business on an advertising model just yet.

Juno will launch with content in standard definition (as are rival services from FetchTV and Telstra), but the pair also have plans to ingest all of the content into their system in a high definition format and start to provide it when Australia’s broadband networks are ready for it.

In general, Storrier said there was a big barrier to entry to providing such a service in Australia. “Having contacts in this area is really important,” he said. “It’s certainly not something you’d be able to set up quickly or easily without knowing the people … and the technical side of things.” He said the pair’s experience in the industry had really sped things up for Juno.

The company is privately funded, but is currently in discussions about taking a second round of funding. In its media release earlier today, Juno pitched the service as being able to defeat rampant levels of online content piracy in the Australian market.

“Australians illegally download more tV shows and movies than any other country in the world,” said Storrier in the statement, noting much of the problem came from the fact that the content simply wasn’t legally available online Down Under — “This is an accessibility issue”.

“When you consider the availability of video entertainment content in overseas markets, we’re practically a content wasteland Down Under,” Storrier added. “A couple of recent launches of IPTV services hardly fill the existing void.”

Image credit: Andrzej Pobiedziński, royalty free

11 COMMENTS

  1. This is certainly good news for Australia, however I’m simply not interested until the content is available in HD. I’m extremely spoilt by 1080p content available on Blu-Ray. Streaming content would have to be available in 720p at the very least for me to be interested. Upscaled 480p flash video looks like absolute rubbish on a 50″ 1080p plasma.

    I’m not sure what they mean by “start to provide it when Australia’s broadband networks are ready for it” in regards to providing HD content. Even Youtube has expanded to providing 720p and 1080p content and it streams no problem on my ADSL 2 connection.

    In addition to this, it’s disappointing they’re choosing flash as their standard. I like to think that flash is on the way out with HTML 5 being the preferred format. Not only does this mean less CPU load with hardware accelerated H.264, but it would mean compatibility with Apple devices like the iPad, which is a perfect device for viewing streaming video on demand.

    Yes I’m a picky bastard but flash and standard definition video are yesterday’s formats.

    • In many ways I agree with you — I try to watch all of my content in at least 720p, if not 1080p, because obviously we have big-screen TVs now and the lower-res content does not look crap on them.

      However, I will be interested to see what Juno’s offering is like — maybe there is some way to deliver a higher-bitstream 480p format that is better than the YouTubes of the world. And certainly Juno is a positive step in any regard, Australia really needs this kind of online streaming solution that is independent of ISPs.

      As for Flash, I disagree with you. While HTML5 is no doubt the way of the future, right now the name of the game for Juno is scale. They need to get as many subscribers in the door buying as many movies as possible, and this means using the easiest web video technology that everyone is familiar with. At the moment, courtesy of YouTube, this means Flash. I think Juno know exactly what they are doing here.

  2. Based on Flash? Get with the program – you’ve got to have a standard that can support all mobile devices and tablets. Cutting out the iPhone and iPad market is a mental (bad) business decision.

    • Sorry Dugald, I disagree with you. It will be trivial for Juno to convert their videos in future and provide multiple formats for iPhones and iPads. In the meantime, they need to win the loungeroom, not the palm-top viewing devices. Flash is the best way to do this quickly, courtesy of everyone being familiar with using it through YouTube.

  3. Whoa there cowboy, it’s not trivial to re-encode a Flash content library to HTML5, even if you control the source material, which Juno doesn’t. It takes CPU and storage and time, which are all getting cheaper, sure, but aren’t free, and the bigger your library, the bigger your headache.

    I believe iPad is going to major as a personal IPTV screen (too early for there to be market data on this so I’ll have to stick with “believe”) and I think Juno would do well to consider the choice between Flash, HTML5 or both very carefully.

    All those iPhone users chewing up the majority of Australia’s mobile web data at the moment are familiar with YouTube on their device only because of HTML5. Offering a Flash-only service is never going to persuade them to change devices. Not even if Juno somehow manages to secure exclusive rights to some of their library.

    • >Whoa there cowboy, it’s not trivial to re-encode a Flash content library to HTML5, even if you control the >source material, which Juno doesn’t.

      Actually my impression is that Juno does control the source material — they are ingesting it into their system, so I am pretty damn sure they have access to the original HD material and are downsizing it.

      >I believe iPad is going to major as a personal IPTV screen (too early for there to be market data on this >so I’ll have to stick with “believe”) and I think Juno would do well to consider the choice between Flash, >HTML5 or both very carefully.

      I’m sorry, but in the real commercial environment, there are simply crap all PC-based media centres out there (which is the market that Juno is going to initially target) that currently support HTML5 without a browser upgrade. You can argue all you like that they should be targeting HTML5, and Steve Jobs will back you all the way, but the only way Juno is going to survive and prosper is to use the format that most of the web still does … Flash.

      It may not be perfect technically — but it’s commercial reality, and if there is one thing I am in favour of in terms of technology startups, it’s facing commercial reality.

      >All those iPhone users chewing up the majority of Australia’s mobile web data at the moment are >familiar with YouTube on their device only because of HTML5. Offering a Flash-only service is never >going to persuade them to change devices. Not even if Juno somehow manages to secure exclusive >rights to some of their library.

      I’m sorry Alan, but if you are launching a video and TV on demand service over the web, your audience is not iPhones or iPads — at least in the short term. It is media centres. And this is where Juno is rightly targeting its service.

      • Sorry Renai, I wasn’t clear. I didn’t mean to suggest Juno should abandon Flash and go all HTML5, I meant that it will become increasingly necessary to provide both Flash and HTML5 support and that the cost of doing so won’t be trivial, whether you do it from day one or day 1,825.

        Just to be even clearer, having the original HD source files means Juno need only wait for permission from the content owner to re-encode in HTML5, and that permission isn’t likely to be delayed unless Adobe tries flexing marketshare muscle to discourage them. But having to do the re-encoding and extra hosting yourself adds costs for Juno. If I can encode, host and serve one version of a video file, the profit is X. If I have to encode, host and serve both a Flash and a HTML5 version the profit is nearly X/2. If they also have to pay for a H.264 licence or a royalty at some future point, well, reduce that further.

        iPad and iPhone are starting off a low base, but their penetration is growing at an enormous rate and iPod Touch is huge too. I’d love to ask 25 randomly selected average consumers (i.e. not Delimiter readers) whether they’ve watched a video on a Media Centre PC or an iPhone/iPod Touch in the last 30 days.

        You’re right: in the short term, Juno’s biggest market is in serving Flash. I agree. But the short term may be short indeed, and the cost of meeting the medium term requirement for supporting both formats don’t mean the business model is unsustainable but they shouldn’t be shrugged off as not a big deal.

        • Excellent post Alan. A really solid argument there. When it comes to providing video on demand service it’s essential to look ahead and provide services that the competition can’t deliver. Flash is on the way out and to start a new service now with it as the foundation sounds like a big mistake.

          Look at what is happening with Netflix in the US for the perfect example of how it should be done. They’re in the processing of rolling out H.264 Netflix across ALL platforms. You can rent a movie, start it on your X-Box 360 or Media Centre, then pause and resume the film from where you left off on your iPad or iPhone.

          This is the type of seamless cross platform integration that consumers want. If you use flash you’re cutting yourself off from the portable market entirely. Even portable devices that do support flash like Android 2.2 and Symbian\Maemo can’t play back flash video without dropping frames and killing the battery in an hour. It’s a horrible CPU intensive format that needs to die.

          Surely there must be a better solution for a startup company with the giant financial backing of Nine and Seven.

  4. “When you consider the availability of video entertainment content in overseas markets, we’re practically a content wasteland Down Under,” Storrier added. “A couple of recent launches of IPTV services hardly fill the existing void.”

    I wonder if Australia’s draconian Broadcasting Services Act has anything to do with it? I trust that this new service will be offering MA15+ content on a commercial basis, what about R18+?

    Renai, do you have any idea how they have solved the requirement for a Restricted Access System (RAS) for age verification? To the best of my knowledge most RAS use a credit card for age verification. Whether that was appropriate when first setup that hardly seems a suitable surrogate for age verification today.

    You can buy a VISA gift card from the Post Office, this allows the person that purchases it or receives it to spend the gift amount anywhere that VISA is accepted, when depleted the card is then disposed of.

    You can also get a VISA debit card when less than 18 years old, this allows you to spend your own money wherever VISA is accepted and is not a traditional credit card.

    There have also been numerous reports of people under the age of 18 getting a traditional credit card themselves or as a second card attached to a parents credit card account.

    I think the above is enough to question the suitability of a credit card as age verification. I think most users would and should be reticent to hand over any further information than that needed to pay for the content.

    So, how do they plan on meeting the requirements of the BSA?

    • I’m sorry, I have no idea … but surely it can’t be that much of a problem. I mean I assume you would have to be 18+ to sign up for the service, and then if anybody younger than that was using it for adult content, the responsibility would fall onto their parents/guardian/whoever signed up.

      Common sense?

      • You would think so Renai, but common sense isn’t that common, especially in those that drafted the BSA.

        The BSA is the reason that the iTunes store no longer have a “gift this movie” like they used to, because it fails the RAS requirement.

        The ACMA have failed in their enforcement of the BSA as they are meant to. I would have thought this would be a significant problem in trying to secure capital in the current environment.

        There have been a couple of complaints to the ACMA about R18+ content that is available for download from Bigpond Movies. The ACMA ignored the complaint for months rather than acting on them, giving Bigpond Movies the chance to remove the specific titles complained about. And although they have powers to investigate content not specifically reported by the public but they have not done so.

        It is a bad law, but rather than refusing to apply that law it should be repealed. It needs to be looked into as this kind of service will become more likely under the NBN. But the anti-competitive thing is subscription TV services have an exemption.

        PS: Simply saying you are 18 or older doesn’t meet the requirements for a RAS, and neither does providing credit card details. If they host the content OS then it would be OK, but would ISPs then unmeter the service? Not sure if that is being considered though.

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