Damn.  I guess I purchased my Sharp Aquos HDTV too soon.  Vudu announced a while ago that any new Sharp HDTV over 42” would receive a free Vudu box.  I wondered how they were going to get that box into everyone’s homes.  

You’re probably wondering what I’m talking about.  OK, here is the short-form kahani (story).  Every time I see an instance of a company (YuMe’s original plan was similar; to license and distribute content to people’s homes and monetise using our ad management system and networks.  We have a home-grown set-top-box and a set of licensed long-form theatrical movies on our balance sheet to prove it) that is attempting to distribute another device into people’s homes, I hope that they will support in-line, run-time advertising insertion.  Maybe I’m being nostalgic for the YuMe business, but ad monetisation in conjunction with PPV/VoD, if not instead of, still seems to be the only economic model that works. 

The startup business world is littered with the dead, dying or surviving shells of companies that have tried licensing, distributing (with and without set-top devices).   Moviebeam, Akimbo, Cinemanow, Movielink, Apple’s iTV, Netflix and I can go on.  To be fair, some of these companies didn’t distribute a set top device, and some are moderately successful, but I’m probably not going too far out on a limb by saying the business model on a PPV or VoD basis is not easy, and may be a black hole.

I hope that over the past few years that the content owners from whom Vudu and others are licensing content will allow them to monetise the content using advertising in addition to the usual PPV or VoD models.  If nothing else, it’ll help the user experience, and add to the revenue base of the company.

I think I’ll call Marc Jung and ask for a free box and more importantly if he has the right to insert ads into the content he’s streaming into his customer base.  It’ll help his economics, of that I’m sure.   It’ll also be a great outlet for relevant ads.  I know I’d love to see the trailer for the next 007 movie when I’m watching the Bourne Ultimatum on Vudu rather than the trailer of some soppy movie that my wife enjoys.  If I have the choice of purchasing the movie, renting the movie, or downloading/streaming the movie with a few ads, how can that not be better…. Right?  Isn’t choice always better?  OK, it’s not, but in this case I think it’s an improvement and a step in the right direction

Jayant Kadambi