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New Companies, New Markets In Asia

Asia is a largely untapped streaming media market. That's the message many have voiced at Streaming Media Asia 2001 in Hong Kong, and the mantra of many Asian-based companies just starting streaming media business.

Hong Kong-based Deansee.com ( www.deansee.com), a streaming services provider, said it is essentially still educating the local market. Deansee, was founded by Ken Lau and Mark Young, now co-CEOs, acting as a producer of content (shooting, editing, post production) and streaming services (encoding and hosting). The company has done work for a wide range of customers like Armani, Motorola, MTV, Microsoft, and Goldman Sachs, helping them to create and deliver corporate videos.

Although Deansee works primarily in Hong Kong, it has also done work in Japan, Taiwan, Singapore, Thailand and China. According to Lau, the Asian market, and the Hong Kong market specifically, is behind the U.S. market. Asia has not been immune to the downturn in the economy, said Lau. "It's been an uphill battle educating clients. The majority of our clients have never used streaming before," he said.

Lau said that there is no content market in Hong Kong, and there have been no big name webcasts either. Still, he believes that content will come out as broadband reach expands. Despite the huge Hong Kong film market, Lau said that movie companies don't even stream trailers.

He's hoping Deansee can capitalize on this. "We can do interview with the stars and put it on their Web sites to promote the movies," he said. Hong Kong is very 'star-centric' and newspapers and magazines often run pictures of movie and TV stars as well as gossip. He also believes that TV stations will eventually start putting up content. Deansee was an innovator in creating its own niche: filming and streaming fashion shows.

Using their knowledge of events and fashion labels, Lau approached the companies to see if they would want to record and stream their lavish events. "They throw huge launches," he explains. "Why? For the publicity. They invite A-list Hong Kong stars." Newspapers, he said, devote lots of pages to covering these events. "The more outrageous they are, the more press they get," said Lau.

Deansee documents the entire event, from the behind the scenes looks, to the arrival of the paparazzi, to interviews with the stars, to the actual fashion show itself. Footage is edited, then cut to short 4-8 minute videos. "Then we put it on their Web site or send a video e-mail," he said. For a label putting on a lavish show, paying an extra $3,000 to $4,000 for a video isn't much money, said Lau.


Corporate Customers

Like the rest of the streaming market, Asia is looking to the corporate market, too. Lau says he's been successful in the last year since they've been in business because a few simple rules: They kept it small, didn't have VC funding, kept the burn rate low, and didn't spend much on marketing. "Through word of mouth we get lots of referrals," he said. Future growth will come in the wireless and corporate events space, Lau believes.

David Chen, CEO of V2 Technology in China, said that the streaming market in Asia is "very early, with very little awareness." He also pointed out that the actual term itself, (streaming media) is new and not well understood. Much like in the U.S., Chen said that large media companies in China are holding back and pondering business models. Also, broadband adoption has been much slower than anticipated, he said.

V2 Technology is a platform maker, much like Real and Microsoft, except it is based on MPEG-4. It creates encoders, servers and a Java-based player for playback. V2 is going after customers in the TV, cable, newspaper and radio industries and is currently in negotations with some companies.

Chen believes that his company offers a good alternative to RealNetworks, Apple and Microsoft because he's using MPEG-4. V2's advantage, he said, is that it has a low barrier to entry, lower pricing and uses standards. Plus, he said RealNetworks doesn't have dominance in Asia, saying that there isn't even a Chinese version of the RealPlayer. Still, Chen said there's no doubt that there will be a market for streaming. "There will be a market, the question is what size," said Chen. And when will it happen? "No one knows," he admits. "Everyone's still educating the market."

StreamingAsia (www.streamingasia.com) is another firm waiting for the Asian market to blossom. The company provides everything from shooting and editing video, to encoding, hosting, syndication and content management. Also tapping the corporate market, StreamingAsia has provided streaming services for companies such Hang Seng Bank, RTHK (a Hong Kong-based radio station conglomerate) and Davenet in Australia.

Market research firm NetValue, set up shop in Hong Kong in April 2000 to monitor Internet usage and trends in Asia. In April the company released a report stating that broadband use in Korea, dwarfs that of other countries with a commanding 57.3 percent penetration rate, with Hong Kong at 8.1 percent, Singapore 7.1 percent, Taiwan 6.2 percent and China 0.4 percent. In addition to providing broadband penetration rates, the company also measures overall reach of non-Web protocols such as audio-video files, gaming, instant messaging and e-mail. Working with market research gatherer Taylor Nelson Sofres, the company analyzes and aggregates data through statistical sampling. NetValue sells full reports, and annual or monthly online subscriptions, to advertising agencies, financial investors, and Web and e-commerce companies.

The Asian market is ripe for analysis with only veteran measurement services company AC Nielsen as the other monitoring firm in the region.

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