Streaming vs. Progressive Download
Today’s online video publishing market is a mix of user-generated and premium content. Major movie studios are trying desperately to control distribution of their premium content by protecting their revenue through digital rights management and, in extreme cases, litigation. This is the battlefield of disruption and disintermediation where the new world of technology battles the old world of physical distribution and control. Billions of dollars are at stake.
The rest of the business world, outside of Hollywood, stands to reap huge benefits from video content delivered over the internet. Combined with the user-generated content and social networking phenomena of YouTube and MySpace, video offers huge benefits even when there is not a clear path to revenue and monetization. For example, it is not likely that consumers will pay to see user-generated content or will stand for pre-roll video ads inserted before the video of interest. Still, the brand-strengthening effect and customer loyalty derived from community exposure through visual association is clear. Imagine the 1980s Pepsi Generation campaign bolstered by a YouTube-like customer-participation community. Or consider Target with its lifestyle campaigns and strong brand identity driving user-generated video community development. By facilitating continuing education, experience-sharing, or best practices, affinity groups and trade associations increase the value of their membership.
Every organization can strengthen its ties to its members and customer bases through viral video and social networking. This is the definition of Web 2.0 in the truest, purest sense. In effect, every organization that includes its individual constituents with this in mind is a web video publisher.
These web video publishers need to embrace and leverage complex technologies but often do not have the technical expertise to match the need. Those organizations require partners with full-featured solutions that make their entry into this technology quick, smooth, and painless. And even organizations with solid video and IT support find themselves facing tough choices. Right at the top of the list is whether streaming or progressive download is a better delivery mode for their content.
What would appear to be a subtle choice carries a huge business impact for all web video publishers. Technically, both streaming and progressive downloading are methods to deliver online video. Streaming is the delivery of video by means of a dedicated video streaming server to a client video channel. Progressive download is simply the delivery of video files over standard web servers (HTTP). Typically, you are viewing streaming when you see Windows Media and RealNetworks players, and you are receiving progressive downloads with QuickTime and Flash players. However, most players have the ability to do both.
Publishers start with the simple ambition to deliver video content online, but first must choose the method of delivery. Each delivery solution offers functionality within its technology. Cost is naturally a factor, as is the level of control the publisher wants to have over the distribution of the content—that is, will they want to limit who sees the content or will they welcome viral, widespread sharing? There are four factors factors to consider.
With a typical streaming server, each stream requires a specific, or fixed, allocation of bandwidth between the user and the streaming server. The streaming server can only support a defined number of users, determined by the total available bandwidth divided by the bandwidth allocated to each user’s video stream. Since progressive download is similar to a web page or file being delivered from a web server, there is no specific bandwidth allocated to a viewer. The more users, the slower the download, which will result in slower start time, called "buffering" or "loading" in most players. Because progressive download is really just file delivery, it is perfect for existing content delivery networks and, therefore, for supporting a very large viewing audience. Since viewers are downloading the video file, playback is not affected by how fast they are receiving the file. With progressive download and a little patience, the user can view the video without the start/stop buffer breakdown typical of streaming servers, ensuring a higher-quality viewing experience.Ownership of content
With most streaming servers, stealing raw content is difficult because the video is not downloaded, or cached, on the hard drive as it is with progressive download. Most streaming servers offer some form of digital rights management (DRM) capabilities, which provide a degree of confidence that the publisher’s content won’t be stolen and spread across the internet. Progressive download typically offers limited protection, though some efforts have been made to raise that bar.
Building a community is the focus of any Web 2.0 initiative, and in that world, content flexibility is critical. The two main methods of sharing content are through embedding and segment streaming services. These sharing techniques are difficult with streaming because of the ownership controls that are usually deployed to protect content. Progressive download, on the other hand, easily enables these and other sharing standards. Additionally, progressive download will create the playground for future viral services, such as tagging, mashups, and remixing. What role does the ownership and restriction of distribution play in the viral world, where having more views is better? Advertisers are also beginning to realize the power of viral distribution when it is associated with a strong community. Imagine a lifestyle YouTube for Apple or BMW.
Streaming has significantly higher costs than progressive download due to a number of factors. While both have the same hardware costs, streaming also requires a software license for each server. In addition, streaming encourages the use of high-cost servers, versus the low-cost nodes used for progressive download. Further, the need for a larger pipe or expenses associated with bursting should be taken into consideration with streaming. With progressive download you can plan closer to your peaks. If you should exceed your capacity, users will only experience delays, not the start/stop disruption of the buffering process.
Both solutions are struggling to support online advertising. Streaming has a larger infrastructure to leverage, but because its solutions are proprietary, it covers less ground than the free-market opportunities associated with progressive download. Per business context discussed above, in the case of building strong brand loyalty, the monetization is indirect. It is not one-for-one in terms of pay-per-view, CPC, or ad insertion; its value is often realized in reduced churn and increased revenue through loyalty.