Companies have broad aims for online TV

updated 8:51 a.m. ET Oct. 30, 2006

CAMBRIDGE, Mass. - Eyebrows went up when Google Inc. recently agreed to spend $1.65 billion for YouTube, the most popular Web site for free video clips. But that figure could be blown away one day if some emerging companies achieve their much broader visions for the future of online TV.

These companies are building flexible online networks that can host content, serve up ads and dish out interactive features. While "viral" video-sharing sites like YouTube focus on individual clips — many pirated — these new Internet TV platforms are designed to host full-fledged channels that content creators can control.

One of the best positioned is Brightcove Inc., which on Monday is taking the wraps off an Internet video network that handles virtually everything for content creators.

Aiming to serve everyone from garage auteurs to major media companies, Brightcove offers free publishing tools and runs video wherever publishers want it.

That could be on the central Brightcove site, which is accessible through the video search functions at Google, Yahoo and AOL. Or content publishers can use Brightcove to run video on their own separate, branded sites. Or they can syndicate it to third-party Web sites, such as blogs or MySpace pages, where the content might run alongside user-generated material.

All those videos can be sold as paid downloads or streamed for free, with ads. Brightcove will sell ads and pool them among its customers, or it will plug in commercials that content creators sell themselves.

"They can launch a business in our system in a week," said Brightcove's founder and CEO, Jeremy Allaire, who formerly was chief technical officer at "Flash" graphics creator Macromedia Inc. before it was acquired by Adobe Systems Inc.

It's not a new idea that the abundant bandwidth of the Internet could become the delivery mechanism for thousands of TV channels — including new special-interest stations that would struggle to crack the cable or satellite lineup. We heard that pitch in the dot-com heyday.

But after a slow ramp-up, more than half of U.S. Internet subscribers now have broadband rather than dial-up. And the explosive growth of video-sharing sites, YouTube included, has helped convince advertisers that the medium has legs (though the term most commonly used is eyeballs).

These trends have helped Brightcove draw $28 million in funding from such companies as Time Warner Inc.'s AOL LLC, Hearst Corp., General Electric Co. and IAC/Interactive Corp. And Brightcove's flexibility has attracted diverse publishers trying to expand their broadband video presence. National Geographic, the Travel Channel, Warner Music, The New York Times and The Washington Post are all Brightcove customers.

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