The following is an article written by Wes Simpson for DV.com. The original posting can be found here. So thank you Wes and DV for this very relevant posting from the readers of the Marcellus Blog:

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Flash video is a technology that is widely used on Web sites throughout the Internet for delivering video (and other) signals to a wide variety of different devices.

Flash video files and live streams can be displayed on handheld devices (such as the new Droid from Verizon Wireless), all types of laptops, netbooks and desktop PCs as well as a growing number of televisions that have Ethernet ports for displaying content from sites such as YouTube. Originally created by a company called Macromedia, Flash is now a product of Adobe Corp.

WHY USE FLASH?
Flash’s big advantage is the widespread distribution of the software required to play Flash content on a variety of devices throughout the online world. Adobe claims on their Web site that 98 percent of Internet-enabled desktops worldwide have the Flash player installed, and so do hundreds of millions of other devices.

Having the support of the dominant online video providers is obviously a big plus for market penetration, but Flash has a number of technical benefits as well.

Flash is particularly strong in Web sites that combine both vector animation and bit-mapped raster graphics. Vector graphics require much less data compared to sending frame after frame of data describing the changes to hundreds of pixels, even using advanced compression technologies.

Flash also supports H.264 compression, which is used around the world for video recording and delivery. Ideally, this would allow video that was already compressed using H.264 to be directly imported and streamed without much manipulation, or for video to be exported easily to other players.

Unfortunately, Flash’s advanced stream management techniques, coupled with the variable bit-rate control methods used, make this impractical. Instead, videos normally require transcoding before they can be streamed using Flash, and similar manipulations are needed to export Flash files for playback in other formats. This is a double-edged sword — Flash can deliver high-quality images to users on many different platforms, but it has the drawback of requiring unique file structures.

HOW DOES IT WORK?
Flash video is delivered to clients by way of a Flash server, either from a pre-recorded file or as a live stream. In either case, the process is quite similar.

It begins when a user decides to view Flash content. The user can request the content through a Web page hosted by the Flash server, or, much more commonly, the request is made through another Web page that redirects the user’s request for content to the Flash server.

In either case, the user’s device (client) sends two messages to the server to initiate the client-server handshake. Adobe recently published the protocol used in this process, called RTMP (for Real Time Messaging Protocol). Once this handshake is complete, the resulting connection is used to deliver video, audio and other content.

Decoding and displaying the content on the user’s device is performed by Adobe Flash Player software that must be installed on the user’s device before display or playback can begin. This software is typically configured as a plug-in to a Web browser, which means that the browser is responsible for activating the player software and for facilitating the flow of data between the server and the player.

One major benefit of plug-ins is that they can be updated without requiring any changes to the browser software, allowing for rapid innovation. In addition, a plug-in can contain proprietary code or tools for handling encrypted content that do not need to be incorporated into the browser.

Flash plug-ins also support the ActionScript Virtual Machine (AVSM), a software construct that implements a set of common, well-defined behaviors, enabling developers to write a single application that can run on a variety of different platforms, such as Microsoft, Apple and Linux.

Scripts can contain a number of actions for many different types of behavior, such as user interaction, stream management, Web site access and other functions. The ASVM gives Flash a lot of power that can be harnessed by developers to create rich multimedia experiences and even to create games that are written entirely in ActionScript.

CREATING THE VIDEO
Creating a Flash video can be deceptively simple — many Web sites will accept video files in any of a number of different source formats and create a Web page containing that video in a matter of minutes. Similarly, self-contained, portable Webcasting appliances can be used to convert live video signals directly into streams. However, several steps must occur to produce the final product — either a live stream or a file that can be hosted on a server and streamed on demand.

The first step in the process is acquisition, where the source video signal is brought into the appliance for processing. When the signal is a composite/component/SDI video source originating from a camera, tape machine or similar device, this process is known as capture, wherein the video signal is fed into a specially designed interface board that converts the signal into a form suitable for further processing within the appliance.

In the case of video content that is already in a file, the process begins by copying the video clip or file into the appliance, which is often called file capture or upload.

The next step in the process is compression. This needs to be done using one of the compression formats support by Flash technology, such as those provided by Sorenson, On2 or the standard H.264 format (available since the launch of Version 9 of Adobe Flash). Scaling is often also done during this step, whereby the size of the original video frame is adjusted to fit the size of the destination video device, either through stretching or squeezing the video image (normally) or through cropping (rarely).

The final step in the process is to apply a “wrapper” to the video content that helps the playback device understand how the video and related audio or other content is to be interpreted. This wrapper contains information (metadata) about the video image format; lists the compression codecs used to create the data; and describes any other signals such as audio or text that will form part of the output of the viewer. Wrappers, which are also called “containers,” provide a common format for communicating the relevant information about the stream, thereby enabling the playback device to quickly and easily determine how the bits within the stream are to be decoded and displayed.

DELIVERING THE VIDEO
Two methods are frequently used for delivering Flash video to viewers: real-time streaming and on-demand streaming. With real-time streaming a video signal is delivered to one or more viewers from a single source, which can be live or pre-recorded video. This technique is often used for broadcasting live news on Web sites such as CNN.com, and the viewer “tunes-in” to the ongoing program while it is playing.

In contrast, with on-demand streaming, each viewer receives a stream that is custom-delivered to his or her viewing device, on a time schedule that is controlled by the viewer, who can pause, rewind and fast-forward the video. YouTube and many other sites use this technique. Two different, but related, technologies are used to support these two delivery methods.

In real-time streaming, the big challenge is to make a copy of the source stream for each of the viewers who is currently watching. Because the public Internet and many private networks are not multicast-enabled, each viewer’s device must receive a unique sequence of data packets addressed specifically to the user’s device IP address.

To accomplish this task, a “reflecting server” is used to take a single incoming stream and generate multiple output streams.

As shown in Figure 1 (above), video is fed from a source to a Webcasting device, which captures the video, compresses it, and places it into the Flash stream wrapper and format. The reflecting server then replicates this stream for each client device.

In parallel, a portal Web site is often set up that serves as a landing page for user devices to get information about available streams. Clients that navigate to this page are redirected to the reflecting server to actually receive the stream.

The process for on-demand streaming is shown in Figure 2 (above). First, the video content must be created and uploaded to a Flash server. Inside the Flash server, content files are transcoded as necessary into the final Flash streaming format and stored. In parallel, the author of the content will often create a Web page that contains an ActionScript that tells viewers about the available content and give them controls to begin video playback.

These Web pages will redirect the client devices to the Flash server to actually receive the streams. Typically, these Web pages will display a thumbnail that is a single frame selected from the video to illustrate the contents.

GETTING STARTED
A large ecosystem of software and systems has grown up to serve the Flash video market. One of the easiest ways to begin real-time streaming is to rent or purchase Webcasting equipment that is available from a number of suppliers. These self-contained units have video and audio inputs and Ethernet outputs that deliver one or more fully compliant Flash streams. Also, the services of a reflecting server can be purchased or rented as needed to replicate the stream to many viewers. Companies using this approach can get on the air quickly without a huge expenditure of time or money for purchasing systems and training. So what are you waiting for?

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Again – thank you Wes and DV.com

Silverlight aficionados will tell you that comparing Silverlight and Flash makes as much sense as a comparison between a Moto Razr and the iPhone. They will tell you that Silverlight was created for a far bigger purpose;  to light up the web (to use Microsoft’s marketing lingo) in the same way as Windows Presentation Foundation (formerly Avalon – I just love Microsoft’s system of nomenclature. Which genius thought of Vista though?) was to light up the Windows Platform. Maybe they are right – Silverlight might have a more audacious goal (which Microsoft product doesn’t?), but with Microsoft trying to eat up some of the ubiquitous Flash market a comparison is valid.

Before we begin to start comparing them as media clients, let us examine them as application platforms from the perspective of the one trying to play ketchup, i.e. Silverlight:

Security

Silverlight stepped out of the browser with Silverlight 3 and brought with it the same sandbox environment as it had within the broswer. Unlike Adobe Air applications (Flash’s flavor for desktop applications), Silverlight apps do not require elevated privileges to run, which makes for a more secure environment. But then, with elevated privileges Air apps can do so much more.

Offline Browser Support

Speaking of more, Adobe Air has better offline browser support with an included webkit; whereas, with Silverlight if the app requires HTML or a script running within the browser, then too bad – you can’t do it. Air also has local database support with embedded SQLite, Silverlight does not.

Remote Data Access

Silverlight 3 does address remote data access shortcomings; Ajax apps (and Silverlight apps) will be able to to retrieve remote-data which will come down in the default JSON format.

SEO Friendly

Silverlight 3 is also looking to be more SEO friendly by permitting deep linking URLs to point to places within the application.  To make things even more exciting for search engine crawlers, an ASP add on mirrors dynamic content into HTML for easy indexing.

3 D

Things become easier in the 3rd dimension with Silverlight, where you can apply a 3 D effect to any media object with a 3 D API.

Oh and here’s the closer: multi-touch support is available with Silverlight 3… but only on Windows 7 (did I mention this was a Microsoft product?!)

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To summarize: Microsoft seems to have done a great job with Silverlight 3 and promises much more with Silverlight 4. But how can it convince developers to ignore the ubiquity of Flash (installed on 95% of web browsers) remains the big challenge for Microsoft.

The (impending) arrival of Giraffic, with its Peer-2-Peer content delivery technology, raises some interesting thoughts about online video models.

Obviously, the first question to strike me was: what if YouTube was powered by a P2P delivery network? Imagine a distribution network comprising hundreds of millions of “mini”servers, serving up over a billion video views every day.

It’s a WOW factor on too many levels. I won’t even bother going into the cost-savings that would result from a scenario like this. Bandwidth costs could be halved, at least.

But even more exciting than the cost savings is how this could drive a fundamental change in new media business models. Now, you have millions of “distributors” who are not just pointing people to your content, but actually serving up the content as well. As a content owner, you benefit. As a content consumer, you benefit.

As a CDN, you’re scared stiff, and as a video platform, you’re ensuring QoS and reliability, perhaps giving the CDNs a comforting pat in the back.

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A few harsh realities that stand in the way, nonetheless.

P2P delivery happens in chunks, so for users to help deliver those chunks, data will need to be downloaded/cached on their local machines first. This is obviously antithetic to streaming video, and a big argument in favor of progressive downloading.

Along the same lines, the local P2P client would be  the Flash player. Every time a user refreshes a page/navigates away from a page, the P2P network loses a seed. This is in stark contrast to a traditional BitTorrent client, which is “always on”.

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Nonetheless, P2P delivery of online video is a very interesting conversation to have.  Adobe is definitely thinking hard about it, with RTMFP (Real Time Media Flow Protocol), supported by the Flash 10 Player. Joost gave it a shot, but failed.

I think this is one disruption that will completely depend on timing, more than execution. Now’s not the time for it, but 2010…who knows?

A title Guy Kawasaki can use… but the inspiration comes from Umair Haque – “listening beats talking.”

The most significant aspect of a SaaS experience is the relationship that a service provider has with the subscriber. More aptly, the most important control point (for a service provider) is the relationship that the subscriber has with the service.

A sure way to make that relationship a successful one is to let it be driven by customer feedback. It is better to be proactive (in getting that feedback), than having to look reactive (in responding to critique).  The most important thing I took away from the recent post featuring Marcellus (NOSTEALTH) on Techcrunch was that you lose out on interacting with customers when you are in the self-imposed “stealth mode.”

One of the more practical methods of practicing the art of listening is to set up a customer advisory board. If that is impractical for you, then there are tools like Getsatisfaction that make active listening easy. Regardless of how you choose to do it, the ability to listen to validated feedback is your most important weapon. It is practically chapter 1 of your survival guide for SaaS success.

You increase the odds of success in your favor by letting the service be driven by those who are paying to adopt it… your paid customers. Eric Ries made an interesting point in the discussion that ensued the posting:

Customers don’t usually know what they want, but that doesn’t mean it’s not helpful to talk to them to learn about what they need

While Marcellus has a unique product perspective of its own, we also love to listen …a lot of the features in production and in the lab are also customer success stories.

And it is something we are very proud of.

A couple of days ago, I posted the first part in the “20 Questions with Dr. Dre(y)” series.

Something Kris said caught my attention, and this second question is directed at that.

#2. Very interesting point, re: “Platforms are beginning to narrow their focus on core competencies”.
As we see the emergence of more end-to-end platforms, where would that leave pure-play offerings like Tube Mogul (syndication only) and Encoding.com (encoding only)?
The way I see it, both form a piece of a bigger puzzle, and if there are vendors emerging that not only solve that larger puzzle, but also focus on specific core competencies, then it’s probably not going to be very good news for the other pure-play folks.

What’s your take on this?

Kris Drey:

I see the pure plays as a very distinct piece of the OVP puzzle, some having come directly from the platform world.

Encoding.com was once an OVP until they changed their business model one year ago this month.
VideoEgg changed gears back in 2007 from being an online video platform to that of online “engagement advertising” development.

The pure-plays have a very significant role in the big picture, focusing their time on a specific function which adds value to everyone in the form of third-party relationships.

As mentioned in question 1, the partner programs include these pure plays which save the top-to-bottom platform providers time and money offering win/win relationships as add-ons for the end customer.

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Preetam:

Yes, and No.

These pure plays *could* save top > bottom providers time and money if they were able to offer easy hooks into their service that make a particular task(for example..video encoding) economical.

Most of them have an API that can facilitate the hook, but very few of them offer clear economic value in deviating from an on-premise solution.

Case in point, Marcellus uses the Amazon Cloud for video encoding, storage, and delivery. Not only does Amazon provide a seriously awesome API for us to be able to pull that off, they also offer a usage-based model starting at pennies, which makes adoption/integration a no-brainer.

On the other hand, we have a company like Encoding.com. It’s a great service that seems like a clear complement to our offering..on paper. We were even considering leveraging their API to off-load our video encoding. But the economics simply didn’t make sense to us, and we ended up building up our own encoding engine.

In theory, it’s all a nice value-chain. But in reality, there’s very little opportunity for forging fast, on-demand relationships. Which is why I feel like the pure play service providers need to start thinking about interoperability from an economic standpoint…moving beyond simply providing an API.

Over the next few weeks, I’ll be publishing a series of posts under the title: “20 Questions with Dr. Dre(y)”.

These are conversations I’ve had with Kris Drey, the founder of VidCompare.com-  an online service that helps folks find the perfect online video platform provider suited to their needs. Kris is also Vice President (Product Marketing and Management) at Fliqz, which is also an excellent online video hosting and delivery service.

Kris happens to be one of the under-mentioned stalwarts of the online video space, IMHO. His perspectives on online video are very clear, grounded in reality, and create a good balance between innovating vs. catering to demand. We are totally delighted to have Kris talk to us and share his thoughts, so after a round of profuse thanks, and without further ado:

#1: Kris, you’re the founder of a terrific site that compares video platforms, VidCompare. It’s surprising that in the 10-odd years of streaming media being around, there hasn’t been a site like VidCompare. Why do you think that is?

Kris Drey:

The key reason for the lack of an OVP comparison site until now is that online video has not been in the mainstream for long, we’re still in our infancy. But thanks to massive broadband penetration and the birth of YouTube, online video has become a world-wide phenomenon pushing viewership numbers to astronomical levels with and astounding 21.4 billion views in July ’09, in the US alone. This staggering number proves the fact that online video is no fad, much like email has become a permanent and daily part of our lives.

Consumers and enterprises alike have come to realize the power of online video in the form of entertainment, shrinking television viewing, and as a highly effective marketing tool. OV is no longer just a competitive advantage but is rapidly becoming a table stake for any online marketer.

The OVP space is looking more and more like the CDN space every day as feature sets expand and prices retract. Platforms are beginning to narrow their focus on core competencies such as video SEO, syndication, and analytics for example. The fight for differentiation is fierce as business deals are struck with third parties forming deep partnership programs offering a wide array of solutions, and internal technologies advance bringing about unique offerings such as Kaltura’s open source platform.

Now, more than ever, as marketers look for new ways to drive high quality leads, online video is proving to be at the top of the list of every strategic roadmap. This fervency has sparked a fire that has yet to be contained in the growth of the OVP space. Innovators such as The Feedroom, Brightcove, and thePlatform are joined by a wave of new players like Marcellus, Wistia, and vzaar and we’re still seeing new players come into the fray like the recently launched Quick.tv.

This is where initiatives like the OVPSummit and VidCompare come in play. The mission of VidCompare is to help first-time buyers of video, such as VPs of Marketing and CEOs, understand the options available to them, and to assist them in choosing the right platform provider for their business needs.

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Burning question for OVPSummit/VidCompare audiences:

How do you use Vid Compare? What’s the one feature/service missing on the site currently that would simplify the evaluation process for you?
Fire away in the comments section below.

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Every valid response will a free BASIC account at Marcellus for 30-days, in addition to the 30-day evaluation- a $25 value!
Be sure to leave your e-mail address, and rest assured that we will never ever give it out to anyone else, or use it for any purpose except for this one specific e-mail sending you instructions on redeeming this offer.

Here is something you probably don’t know about Marcellus: we’ve tried our hand at content publishing.

Yesssirreee! The Marcellus team was exactly where you, the content publisher, is today: looking for venues/channels/mediums to distribute/monetize/publicize our content.

And honestly, we were not mighty successful at it… so with the deepest respect for you, and a first-person understanding of your needs, we decided to stick to what we do best: design the tools to help you dig the gold.

What are the 10 things we learned about online video:

1. Online video is online first and video second.

2. Online video is driven by consumption, not adoption.

3. Online video is essentially a niche business.

4. You can compromise on the meaning, but you cannot compromise on quality.

5. Context is king; content is the king-maker.

6. Unless you are in the porn-business, people are willing to pay$0 for video.

7. Youtube is, and will increasingly become, the TV Guide channel.

8. Finding your audience is easy, keeping it is hard.

9. The name of the game is: accessibility.

10. It helps to have an online video platform that places its bets on your success.

Okay, the last one was a plug for Marcellus… so I will give you another one:

10. You only define the price, the users decide the value of your content.

Happy Streaming.

I do this post and then this one emerges.

Defining the problem – content is treated differently under different contexts.
People tend to treat social networks with a certain level of attention deficiency, compared to content/portal sites, which is understandable.
Reading CNN requires more attention (for the most part) than reading your friend’s status message (though I do not know how can you not pay attention to – “John is growing purple blisters. They may burst open any time”).

Hence, the need to create more engaging social media experiences on social networks.
Can you do it with interactive video? Yes.
Can you do it with contextual based advertising within video? Yes.
Can you do it with personalized recommendations? Yes.

But I still do believe and would like to harp on respecting the context of the content.
Content will play significantly differently in social networks when compared to content portals because the core user needs that are being satiated are different. Content owners will have to recognize that.

And OVP providers will need to provide tools that help slice ‘n dice content into meaningful micro content that can be re-purposed and/or redistributed and tracked easily. Sell the car and sell the parts of the same car – bling bling.

It is a brave new world.

Facebook’s dramatic rise as video site further exemplifies the importance of video as a social media object.

Instead of the linear/one-to-one relationship that video plays in traditional media, video has the increasing potential of becoming a major driver in an ecosystem of creators, promoters, re-mixers, consumers and enthusiasts.

Not sure that this signals a new trend “where YouTube is being abandoned in favor for the social networking site”, because YouTube is making its own moves to create new avenues for creation and consumption, for example, with YouTube Direct.

But the bigger point: video is rapidly turning into a highly pervasive social media object, and has the ability to carry tremendous amounts of context + conversations > subsequent earning potential with it. Be it Hulu, Facebook, or YouTube, online video is shaping the next frontier of social media.

I got my first email at 12:28 pm – “rumor: Google to buy Brightcove.”

I got my second email at 1:07 pm – “rumor false: Google to buy Brightcove.”

I spent the time during those emails scratching my head – What is wrong with the Brin/Page/Schmidt triumvirate? Does it really make sense for Google to invest in an up-market (at those price points Brightcove is no Walmart) white-label video streaming provider?

Google has an audacious goal – organize the world’s information. I guess it does make sense for Google to acquire tools that publish that information… but Brightcove? Seriously? Some reports went on to expand that it would create synergies with Youtube. Um… you mean the same synergy that Brightcove and Brightcove TV created?

Sometimes the sum of the parts is less than the parts themselves… what these speculators are missing out on is: the white-label video platform space is different than the UGC video portal space. Publishers in the white-label video have different needs – they are not looking for platforms that market their content.

They are looking for tools that let them publish, manage and track their content at affordable price points. Then they are looking for a platform that lets them scale up and scale down on-demand. Simply put, IMHO – Google + Brightcove makes as much sense as Pizza + Ketchup. Sounds exciting for 39 minutes… and then you wake up.