Andy Chan is a friend and recently, an entrepreneur. He wrote a smart post about Bittorrent a few weeks back:


    The key point is that Youtube makes everything so, so simple. Like RedSwoosh, it gets rid of bandwidth concerns. It can also migrate with embeds (RS can do this, but who wants to have to edit code?)

    Youtube doesn't require a client install, and it's very community-centric.

    I don't think that Red Swoosh wants to be Youtube. It has a different set of advantages.

    But what exactly are they?

    How do Youtube and Red Swoosh co-exist? When do you use one as opposed to another?

    I ask these questions not to be a hater, but GooTube is now a force, and I think it's best to add value to the gaps in the video space rather than try to compete head-on with the dominant player.

    Any thoughts?
    • CommentTimeDec 16th 2006 edited
    [For beginners, the similarities between YouTube and Red Swoosh is that we both give away free bandwidth for folks distributing content]

    This is a good question and gets to a fundamental shift that might be ahead in the telecom marketplace.

    That shift is what I call CDN Subsidies. (CDN stands for the term Content Delivery Network, Red Swoosh considers itself a P2P-CDN). I'll get into the details in a second, but first let me explain the background here.

    In this new online video era, uploading, publishing, and licensing have all become easier (though licensing content is still not "easy"). What has resulted from all of this simplicity is that the new bottleneck in the marketplace is shifting toward delivery and bandwidth infrastructure.

    On the revenue side of the equation, there are a host of business models that have really started to hit their stride. . .a notable example is Google's AdSense (but there are others as well). Revenues look so good and are scaling so well, that they're simply looking for new real estate, new outposts to place their profitable product.

    Google asks itself everyday, "Where else can I put another keyword advertisement?", and the question that follows is "where is the most pain in the marketplace where I can essentially trade easing that pain for more real estate for my keyword advertising"

    And so a perfect example of CDN Subsidies is GooTube (I wish it were called Yoogle). GooTube gives away free bandwidth in exchange for advertising real estate that they can sell. They essentially trade their profitable Ad product and bandwidth, for your content. GooTube gets their new ad real-estate (your content), and you get free bandwidth.

    GooTube has created the perfect CDN Subsidy that they hope will make them gobs of cash. Heck, they don't even have to split the ad revenues (which reduces their take by up to 80%--look at the deals they've done with MySpace, AOL, etc.).

    So getting back to your question, where does P2P and specifically Red Swoosh fit into all of this? Where there are a few angles here:

    P2P-CDN makes networks more efficient, thereby making the CDN Subsidy more beneficial to all those involved. That could mean that Google uses P2P-CDN to basically create a FREE subsidy. They subsidize bandwidth, not by paying for it, but by simply providing an effective P2P-CDN that gets rid of bandwidth costs all together. That's truly the ultimate b-model for Google. .. . they get your content, the ad-real-estate, they don't share the profits, and they don't pay bandwidth costs. It's so good it's almost evil.

    The other side of this however is that if the P2P-CDN is widely deployed, then content owners don't really need GooTube to get rid of their bandwidth costs. This allows content owners to go out on their own without whoring their content away for free to GooTube. It may also result in GooTube giving the content owners a better shake for their real-estate.

    All this being said, the major aggregators on the Net are not willing to give up control of their content or their brand to GooTube who for all intents and purposes is a vast media company and competitor to the large aggregators and media co's. And they certainly do not want to have to put up with the low-quality resolution and bitrate that youtube constrains clips at. And don't forget about the 10 minute limit. And then there's the whole IPTV thing. Comcast, Time Warner Cable, DirecTV, Echostar are all getting into IPTV in a big way, delivering video over the Internet to your Tivo or DVR. GooTube just doesn't play in that world.

    GooTube isn't delivering files in your RSS feed. They won't predeliver files to your users, or let them record like you might on a Tivo. They don't let you distribute in even a decent resolution let-alone hi resolution(GooTube clips can't be over 200kbps). They won't let you go over 10 minutes. They won't let you sell advertising. They won't let you get a cut of the advertising they sell on your content. Oh, and man doesn't it suck when those GooTube clips come down slow, and you have to wait before viewing the stream? Sounds like a great deal for the professional content owner, no? Not particularly.

    So the bottom-line is that GooTube is the ultra-Consumer-CDN-Subsidy. But GooTube is not a professional-grade CDN that delivers content with no strings attached. That's what Swoosh does, and what we continue to do well. And the top 5000 sites on the Net who won't really use GooTube in any substantive way are our primary customers. And the bottom 100K sites that don't have control of their content and are getting a raw deal from GooTube, now have an alternative and can focus on making money instead of giving away their content for free bandwidth.

    And hell, if Google enlists Swoosh to help them create the most fiendish CDN Subsidy (I recently saw 3 different Google employees sign up for Swoosh accounts), we're ready for duty!
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