Streaming Vendors Zero in on the Enterprise
By Matt Stump
from the June 18, 2001 issue of Broadband Week
While the business-to-consumer streaming market has torpedoed the business
plans of dozens of technology and content players, streaming survivors are finding a receptive audience in the enterprise market.
Earlier this year, Jupiter Media Metrix released a report that estimated the enterprise streaming market will reach $2.8 billion by 2005, lead by high tech, financial services and pharmaceutical companies who will using streaming for sales training, corporate communications and customer education.
According to Mark Harrison, research director, at Jupiter Media Metrix, enterprises are finding that streaming, as a productivity tool, can improve internal communications, boost the sales process and save businesses money on corporate travel and training costs.
Streaming is repeatable, allows for dynamic on-demand access, and takes into account time shifting and time zones, Harrison says. "You have internal streaming applications like executive addresses, sales training, then external, which is product launches, launch support, marketing events, customer service."
High tech companies are an early adopter, "particularly for internal streaming because they want to prove a concept," he says. "Ultimately it comes down to ROI. The early adopter needs to show
ROI."
A number of companies, some of which launched with business-to-consumer strategies in mind, now are transitioning to the enterprise space.
For CacheFlow, the basic premise is to move popular content to the network's edge to give end users better experiences, according to Patrick Harr, vice president of marketing, CacheFlow. Time Warner's RoadRunner high-speed service was an early client, he says. "Users have an insatiable appetite for bandwidth and you need to cache content closer to the end user."
But CacheFlow has expanded beyond RoadRunner into the enterprise space. "The enterprise is somewhat similar in their needs," Harr says. "They tend to service their internal community, and their networks are very
hierarchical in design."
By combining with service provider backbones, CacheFlow offers enterprises quality streaming experiences for employees and customers at far ends of the network, Harr says. "Caching solves a lot of problems in the service provider space," Harr says. "It prevents enterprises from having to upgrade networks. Users have access control, and are able to filter out what's coming into the enterprise."
"We've seen a fundamental transition from client/server based architecture to one of browser-based as one of the primary mechanisms of getting information," Harr continues. "Oracle and PeopleSoft are moving toward a
web-based model of dissemination of information
We see a wholesale trend toward that premise."
CacheFlow launched its CIQ content delivery architecture in February. The software enables enterprises to manage content flow and efficiently distribute it closer to end users. The software includes a server accelerator that sits in front of web farm, and provides better response time.
Harr says over the past four months, more enterprises are looking at instituting streaming applications. "They're saying: 'We see the benefits. How do I get started and what's the cost?' " For the enterprise, the cost tradeoff centers on buying bandwidth and software on their own or having third parties like CacheFlow step in.
The economic slowdown works for CacheFlow in a number of ways, Harr says, beyond the sales pitch that streaming for sales training can save companies travel costs. One enterprise is using CacheFlow so their CEO can communicate more often with employees around the world, Harr says. Start to finish, CacheFlow set up 60 sites with 60 servers in 60 days, Harr says, and saved the company $1.3 million. "The branch offices aren't stepchildren and they can view content on demand. That's a big plus in the enterprise." CacheFlow counts CS First Boston, Morgan Stanley and Goldman Sachs among its financial services clients.
Pharmaceutical companies are another growth area, Harr says. "They typically have a six-month training window to introduce a new drug. Now they think they can cut that down to one to two months [using streaming]. That's another four months selling the drug."
Daimler Benz Corp. is using streaming media to film, transmit and store auto repair information, such as how to change out parts in cars, how to change mirrors, etc., Harr says. The company records hundreds of videos for mechanics, then downloads them to computers at service centers via streaming technology.
"There is tremendous upside opportunity," Harr believes, across various industries for various applications. "We're starting to see their eyes open. What's going to explode here is the enterprise."
Harr says only six percent of his current client base use streaming applications. But 70 percent to 80 percent of all new deals require a streaming element. "We allow companies to deploy a proxy today, then they can upgrade quickly to a full blown CDN network. The appliance is a form factor that's easy to deploy and manage."
Harr says the biggest challenge is customer education. "It's one of those classic disruptive technologies that will change how business does business going forward." Harr said CacheFlow's discounted its bundled CIQ started kit from $215,000 to $115,000 to jumpstart the business.
Kasenna is seeing increased interest in its MediaBase technology, according to Greg Carter, director of business development. The company counts 1,200 customers including 500 universities.
MediaBase supports multiple frame rates. "Being on corporate networks, you want the quality to be good," Carter says. "The frame rates should be high. The quality of MPEG1 at 1.5 megabites per second is very high."
One California university uses three different streaming encoding formats to serve its students, Carter says. The university will videotape lectures and send an MPEG 2 videostream within a closed-circuit TV feed to a neighboring lecture hall. A separate MPEG1 feed is sent to students viewing the lecture in their dorm rooms. And a 56 kpbs feed will go out across the public Internet for telecommuters in their homes. "It's really, really a powerful solution," Carter says.
Kasenna's enterprise customers are using its software to distribute training content to edge servers throughout their company. "We can pre-populate all content at all the offices," Carter says.
"When you put a video server into a network, historically that raised a red flag," Carter says, because of the impact streaming video had on the network. "We've learned about network throttling. Part of our product allows you to throttle back the network adapter."
Kasenna's software also allows companies to post content that only certain users can see, such as content for managers only. "We have a whole authentication and access control system," Carter says. "There may be some higher priority content or we can raise the priority of the CEO's address and lower the priority of training tapes."
Another key element going forward, Carter says, is content management. One university now has 24,000 hours of content, Carter says, which must be categorized for students to effectively search through the material. "We have relational database technology or companies can partner with an asset management company. In that case, we can be streaming component of that system."
NaviSite has upgraded its streamOS product for enterprise streaming by introducing streamVOX that includes six rich media panels, says David Gilby, director of marketing, streaming media at
NaviSite.
"Enterprise streaming activity definitely picked up in the first quarter," Gilby says, adding the industry is still young. "We're only at 10 percent of what we're going to see. There will be some growing pains as people try it."
streamVOX allows companies to introduce polling, chat, email, e-commerce and synchronized slides to standard talking heads in videostreaming applications.
NaviSite boasts a wide ranging client list. "We just signed a deal with Northeast Power Utilities which has 7,000 employees," Gilby says, for education training. NaviSite also handles the long distance streaming for St. Jude's Hospital in Nashville, which covers medical operations and public relations events.
Anheuser-Busch has used NaviSite to store and stream its Budweiser TV commercials on the company's web site. And Gilby says A-B is using NaviSite to handle internal corporate communications streaming.
Gilby says future growth "will come down to how cost effective it will be for the enterprise." Jupiter's Harrison couldn't agree more. "There is a tremendous amount of market education vendors need to do," he says. "You have to show efficiencies in the streaming process, the cost savings of training, and also have tracking and compliance tools."
"The real reason we see that enterprise streaming will take off is there are fewer revenue model implications [versus entertainment streaming]. The CDNs are driving this because they are anxious to prove their viability."
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