Mobile phones just got interesting…

Despite being a tech geek I have not used a mobile phone more that about 10 times in my entire life (shock horror). They just never really interested me but I guess it says more about my social ineptness than it does about mobile phones.

But an odd correlation, I had the same feeling about computers as they went through the Microsoft business tools era (Word, Excel, Quickbooks et cetera), as a developer back then computers just didn’t get me going, so I spent the nineties in electronics making audio products.

Mobile live stream battle on SXSW 2008: Scoble vs. Pistachio

Despite being an early hacker on a Sinclair ZX Spectrum at about age 14, computers really only got interesting for me with the arrival of the Internet, then when broadband arrived I got ‘really excited’.

But in the last few months something has changed the landscape so dramatically in the mobile market that I see a paradigm shift similar to the above where an entirely new species of mobile device evolves which is much more attractive than has been previously seen. Obviously I’m not alone having these thoughts, as we sit here thousands of others are having the same realizations, not least those emanating from Adobe’s crystal ball.

So after teasing Sarah Lacy I’m checking out the comments of Arrington’s interview with Lacy which was streamed live through a mobile via Qik and looking through, there’s loads of trolls getting into a twist about the quality of the stream. Being a bit of an expert in the sound department, immediately I see obvious errors and solution.

Sound quality is everything see! People will generally tolerate lower quality images providing they can enjoy the experience audibly. The majority of content I have seen via the Qik service (embedded on blogs that I’m subscribed too) has been compelling but would probably not have been published if not for the elegance of these emerging innovations.

IMO these criticisms about quality of the stream could have been avoided. The quality of mobile streaming is just about OK (if used correctly) providing these simple rules are adopted.

1) Most importantly, you have to use an external mic (in some cases), plus the mic should be as close to the speakers as possible.

2) Like all video filming, you need to have the device on a stand, or at least support the mobile so that it does not shake while your filming.

But the upside is that the elegance of this technology is amazing and mobile streaming is going to finally make mobile phones interesting (for me at least!) but more importantly, online video is going to soon actually start making money too, and that is really exciting!

False Starts

We have seen many false starts in online video so far, most notably Youtube is still loosing money, then the recent announcement of the closure of Stage6, Reever just salvaged by Live Universe, and these are just the obvious examples, with many others also struggling to pay the bandwidth bills.

So what have we learnt? We have learnt that streaming high quality video is expensive and current advertising models do not generate revenues sufficiently needed to sustain these services.

But raising ad revenues needs a little careful analysis of new innovations / technologies before we will start to enjoy profit from online video. The good news is they have ‘just’ arrived. I saw the first example of Adsense in Flash being used by Scribd and posted the article Adsense in Adobe Flash now possible detailing the said innovation.

I should not need to explain why Adsense is the best ad network online, the fact that Google makes more money than anyone else via relevant online ads should be evident enough.

Yet right now we have millions of Flash widgets and videos embedded all over the net without related embedded ads within them, madness! Why this is where the content is? The good news is that this is ‘just’ about to change. Relief at last…

Adsense for Video (AFV) is just emerging from the laboratories and while still not having FDA approval it is being tested in some surprising places. The prize for best execution and innovation goes to Barcelona based Sclipo who are leading the way in undergoing stage 4 trials with these emerging technologies and are changing the nature of online video advertising. They are also building a catalogue of interesting content and exploiting it correctly.

Turning Mistakes Into Opportunities

However, were not out of the shit just yet, the biggest gripe I have with online video is this: you choose a video that your interested in, you get your 5 minute dose, then you need another fix, but you have to actually get up and push buttons, what a drag, can’t you guys tell I’m just wanting to relax right now?

This was an immediate problem I initially experienced with my own application Myplaylist (a free music playlist Web app), when their (a users) playlist finishes, I want them to relax, let me do the hard part, finding the most relevant / related match to their initial selection and to automatically continue delighting them with content.

It was one of the most interesting algorithms I had to build, and while I’m still not 100% happy, most of the time the results are pretty good (I still need more data, and I’m still working on it). Alas the point is this, I want the next most relevant video to automatically start immediately after the (opportunity) ad break! Got that Taboola, you need an open API which suggests relevant content which can then be automatically streamed after the ad break, thereby continuously delivering relevant content so I can just relax!

So This Is Where You Put The Tap

Currently, what we have is millions Flash widgets embedded all over the net, most of it low quality content, which is generally expensive to produce and provide. Yet pretty much no revenue is being generated by providing this service.

Adsense in Flash and Adsense For Video is the beginning of a bifurcation that will finally do to the Web2.0 movement what Adwords did to search, and what Adsense did to blogs and websites. When Google worked out how to provide relevant contextual ads along side search results, immediately a paradigm shift occurred and Google tapped it with stunning effect. But also most interestingly Adsense helped fuel the growth of a truly independent new media source (blogs) which are now challenging traditional media and are the dominant curators online.

Web2.0 has been floundering around until now, like search did before Adwords arrived. But now that it is technically possible to incorporate relevant contextual adverts within the Flash elements that contain the rich media content, the Web2.0 movement finally has an oxygen generator and can soon be taken off life support.

Content Creators And Curators

With the birth of mobile streaming, the barriers and costs in creating / capturing content has just dropped significantly again, being that these are highly compressed files the bandwidth costs are negligible, so we are about to be deluged yet again with a significant rise in the amount of online video published. But there is little money in dribble. The big ad revenue will obviously be made from content that targets demographics who are interested in ‘compelling’ content.

This compelling content will be curated and republished by our favorite blogs and Web2.0 destinations, where the cream will rise to the top and the bandwidth will be consumed by an audience that is engaged, not wasted on people who are simply bored and uninspired. With that, the associated ad revenue will rise above the costs of providing such services, generating actual profits that will allow those that ‘do it right’ I.e. elegantly, to survive through the looming financial downturn and inevitable squeeze of available investment cash which is currently threatening the very survival of those who built gas guzzlers and have no tap.