06/22/2010 05:12 am ET Updated May 25, 2011

What's Next for Online Video?

Online video has changed drastically over the past few years. Just a decade ago, companies were using postage-sized videos on the web. There was no YouTube or Hulu.

Today, that has changed. Video is accessible and available on mobile devices and computers.

However, challenges remain.

Global access:
  • Technology: Relatively, there are very few countries that have reliable access to high-speed Internet. For countries that do have access, they've leveraged it to create and distribute not only content, but innovative technology in the online media space.
  • Rights: Traditional content companies have long-standing agreements with distributors that significantly restrict international distribution of content. An entire ecosystem of illegal sites exist just to bypass these restrictions. Not only are content creators losing out, but they're also ignoring a huge potential. Apart from international distribution issues, a few distributors broadcast the show in one country and only make it available on-demand in another. A great example of this is Warner Brothers' Big Bang Theory. You may watch the show on TV. But, if you're in the United States, you won't be able to watch it on-demand (free or paid). However, you can watch the entire series on iTunes, provided you have a Canadian account.
User experience:
  • Distribution platforms: While YouTube has made online video accessible, there are still too many hurdles for consumers. Although these barriers are being reduced on a daily basis, many companies create their own custom players that are poorly designed and haven't been tested. Similarly, the options to view content are endless. You can watch the same video on half-a-dozen sites. While this is good for the distributor, it isn't good for consumers. They don't know how they can interact with more than just what the video has to offer. Simplifying distribution platforms with clear messaging is something that producers and distributors have to work towards.
  • Live streaming: Although sites like Ustream and Justin.TV have gained popularity, a majority of content on these sites is poorly created and adds very little value. Just like every other platform, these sites have premium content. However, it's not very frequent. On the other hand, the potential of live streaming is tremendous. Just in the past year, has partnered with high-profile media clients to produce and distribute live events over the web.
Business model:
  • If you speak with any online media professional, they'll tell you that the web offers great reach and an unlimited potential. Both of these are true. However, what the web doesn't offer is TV like revenue, yet. Advertising agencies are still using CPM models to purchase media. And while CPM is arguably acceptable for banner advertising, this model does not work for online video. The new medium is more intimate and has a much larger impact than display ads.

While online video has certainly progressed on many different levels, the overall user experience needs to change -- for consumers and for content creators.


Aanarav Sareen is a content creator and digital media consultant. He blogs at Digital Media Business and publishes the monthly Digital Media Newsletter.