HDTV Update: Online Video Buildup

Aug 22, 2005  •  Post A Comment

Mark Cuban, who co-founded HDNet with Philip Garvin of Colorado Studios, is known for his willingness to take strategic risks. He’s doing that again in the high-definition TV business by making HD content available on a downloadable basis from the Internet.

HD video on the Web is a nascent business, engaged in by only the earliest adopters. But initial feedback from HDNet partner CinemaNow, an online download service specializing in feature films, suggests that consumer appetite for HD video online is strong.

“Because of interest from the customer base and lots of opportunity to make this available to CinemaNow users, we are putting a lot of effort into building up this HD library,” said Curt Marvis, CEO and founder of CinemaNow.

Providing HD video on the Internet is in some respects easier than bringing it to the traditional TV set. About 13 million homes have HD-capable sets, but only a third of those are receiving HD programming, according to Leichtman Research Group. On the other hand, nearly every desktop or laptop on the market today can handle HD video, said Marcus Matthias, product manager for Microsoft’s Windows Digital Media.

That’s not surprising because computer monitors have better resolution than TV sets. If a monitor can handle a high resolution, it can usually display HD content.

Mr. Cuban began making content from HDNet available online through the CinemaNow service last month. Early this month he began separately serving up free footage of the Discovery shuttle launch at hd.net/downloads. The 20-minute HD highlight video is available as a beta test, using Red Swoosh technology. Users sign up for the service and their My Yahoo or My MSN pages, for instance, are updated with the latest HDNet clips.

Promoting the Channel

Mr. Cuban said he views the online distribution of HD content-via both Red Swoosh and CinemaNow-as promotional and complementary to the linear HDNet channel. “The goal is to drive them back to HDNet,” he said. “We are not looking to create an alternate delivery mechanism.” He added that HDNet is the first high-definition network to offer HD downloads of its content.

To provide the shuttle video downloads, Red Swoosh uses peer-to-peer technology similar to that employed by online pirates, in which users download large files by sharing broadband capacity with other users. In this case, though, the content is not pirated. As more and more users trade content, the video is sent at faster speeds. Additionally, Red Swoosh can monitor and control the distribution of content and can track how long a download takes and how much bandwidth is used. Mr. Cuban said HDNet is refining its service based on that information.

The shuttle video service is hosted by Box.net, which enables the files to be sent using a subscription technology known as RSS, or really simple syndication. RSS allows content to be fed regularly to a personalized Web page. The HDNet content is encoded using the Windows Media format. The HDNet download is not available yet for the Mac platform.

The marketplace demand for HD programming, coupled with consumers’ increasing willingness to watch broadband video, suggests that the HD online market could be big. “More and more PCs are being connected to HDTV sets,” Mr. Cuban said. “With Media Center PCs and Apple pushing hi-def, and with Sony PlayStation 3 and Xbox 360 [in HD], we think that will expand it further.”

While he does not plan to make online HD video a replay or online feed of the linear network, Mr. Cuban does anticipate adding more HD content for download, such as weekly promotional video for upcoming shows and perhaps a complete episode of a show to promote the linear channel.

“We want to give you a reason to call the satellite operator or cable operator [and get HDNet],” he said.

He also plans to offer more shows on CinemaNow. The site currently offers a handful of HDNet programs and will add more as HDNet encodes more shows in Windows Media.

Mr. Marvis said demand has been strong for the HDNet material and other HD content on CinemaNow. About 25 to 30 of the site’s 3,000 titles are offered in HD. “The interesting thing about HD content, and one of the reasons we are pushing to get more, is that there is a disproportionate interest in users interested relative to the amount of content we offer,” he said. CinemaNow is selling thousands of HD titles each month.

Consumers can expect more HD content, including concerts and extreme sports. HD files take about four times as long to download as standard files, which makes shorter-form content more attractive initially. The goal is for CinemaNow to offer several hundred HD titles by the end of the year.

The HD content on CinemaNow is also in the Windows Media format. Mr. Marvis said the Windows Media HD format is competitive with the high-definition standards for TV sets. Windows Media Video files can be played in Windows Media Player and other compatible players, including those from RealPlayer and Musicmatch, Microsoft’s Mr. Matthias said.