Babelgum goes after the long tail

By March 26, 2007 No Comments

I am at the Red Herring conference today to do a panel session on “what are the big boys buying?”.  That was cool, and we learned that the big guys (and I suspect other companies too….) buy companies to fill gaps in their product sets.  It is my perception that they do this increasingly scientifically – combing VC portfolios and matching that with their own gap analysis.  The “big guys” on the panel were Anil Hansjee from Google, David Rowe from Microsoft and Stephane Delorenzi from Logitech.

For me, I learned more in the previous session.  Silvio Scaglia of FastWeb and Omnitel fame was interviewed about Babelgum, his broadband TV play.

I have written about them before – but I learned more today.  The big take away is that they are going to allow people to upload their own content and go after the long tail.  This is still professionally produced content and they will respect copyright – according to Silvio Babelgum will guarantee a $5 CPM in order to kick start the service (this will hopefully get them over the chicken and egg problem of needing advertisers to get content and content to get advertisers).

This takes them to the opposite end of the spectrum to Joost, which is more about premium content from the fat head.

As I wrote in my previous post if I was building a service in this space I would go after the long tail too.  Silvio is investing heavily though – and that is because as well as building a service level he is building a P2P delivery infrastructure.

In the long run I don’t see the logic for combining the service layer and delivery layer in the same company – the best delivery infrastructure will get the most value by being used for multiple services, and likewise a good service ultimately needs to be free to select the best (and/or cheapest) delivery infrastructure.

In the short term though I guess both Joost and Babelgum feel that unless they build their own delivery infratructure the quality won’t be there.

The other thought I’ve had, and this comes from a question that was asked of Silvio, is how far can P2P go?

We are talking about huge video files now and networks will get congested, so it seems to me that ISPs will want to charge heavy users for the bandwidth they consume.  The ISPs themselves will be paying to carry that traffic, after all.