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Sab Kanaujia Interview Part 2: Monetization, Vdopia, TV Experience

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NBC Universal (NYSE: GE) has entered into a strategic partnership with Ten Sports to launch a sports video portal. For the first time perhaps, cricket crazy Indians from everywhere can enjoy a free live webcast of key cricket matches—a service that was previously available, but behind a paywall. We first reported the story on 26 August.

In an email interview with contentSutra, NBC’s VP of digital product strategy and development, Sab Kanaujia, who will also head this business, talks about the economics of webcasting for free, content, that is expensive to acquire, recreating a television experience on the web and more.

This is the second in a two-part interview. The first part is here.

Do you fear that the site will get banned in workplaces as it becomes popular and employees watch cricket during their work hours? (Many Indian offices have banned IM applications, mail websites and social networking sites.)

We’re aware of this, and it’s a valid concern. But given this is outside of our control, we’re focused on providing the best possible experience when and where users can access tensports.com.

Why did you decide to make the site free of charge for this service that has this far been paid for? Do you hope to generate a lot of advertising for the live webcast? Is there going to be a time lag for the web feed?

Providing all the content on tensports.com, both live Webcast and video-on-demand, available for free to users was a rather straightforward decision for us. First, sports fans in India are not currently habituated to watch live sports online, so we need to change user behaviors, and therefore didn’t want to put any hurdles to adoption. Second, all live cricket is already available on television, so a pay wall on the Web would not work.

Watching sports today is primarily a television experience. Charging online users would work either for niche sports which are not available on television (e.g., cricket & soccer in the U.S.) or when popular sports are not available on television for some reason. E.g., sports leagues in the U.S. (MLB, NHL, etc) are currently charging a small subscription fees for live online streaming, but I’d imagine in most cases fans subscribing to these packages do not have access to those live games on their television (either due to local blackout restrictions or if they’re following non-local teams whose games are not available in their region).

Cricket in India has a massive following, so it can provide a large and scalable audience necessary for the advertising model to work. It’s too early to say, but we won’t be surprised to see a two-screen behavior emerge, where users watch live cricket on the TV, but also simultaneously interact with their family and friends online on tensports.com to discuss the game.

Ref: advertising revenue, we are optimistic about our assumptions. There are no precedents in the market, so we have many unknowns. We believe that online video consumption in India is about to take off, and as long as we provide a great user experience and, in our case, have exclusive premium content, we’re confident of generating value for all stakeholders - consumers, advertisers, our content partner, and NBCU.

There will be no planned lag for the Web feed of live matches. There might be a few seconds delay depending on user’s computer settings and Internet speed.

Are you gonna show the same feed that appears on TV, riddled as it is, with all kinds of intrusive advertising? If so, won’t that hamper your ability to insert anymore advertising? How do you plan to tackle this?

No, we’ll pick up a clean live Ten Sports feed without any on-air advertising, and insert our ads that we’re selling separately. We’ll be very conscious of providing sports fans a clean and differentiated user experience.

The videos that are on the site right now, don’t have any ads. Will you also monetize these stock videos or ads will feature only on the live feed?

We’ll be monetizing both live Webcast and on-demand videos starting the Compaq Cup Tri-Series.

What is your deal with Vdopia? Is it a three-way revenue share with you, them and ten sports? Which specific kind of ads will you be using on the site?

We’re using Vdopia’s ad sales platform, and they are also our exclusive 3rd party partner to sell online advertising and perform ad sales operations. Vdopia will be paid on a revenue share basis. They will sell advertising against this content on tensports.com as well as on all syndication partner sites.

CricBuzz.com, one of the most popular cricket sites in the country, will be our first syndication partner for the live Webcasts. We’re working on lining up other syndication partners as well to provide wider distribution for our content.

By limiting sales rights to only one sales team in the country, we will be able to avoid any confusion for advertisers/agencies. This will also allow us to maintain the premium nature of the content and pricing control in the marketplace. 

We’ve reserved the right for both NBCU and Ten Sports to sell some of the inventory through its own on-air ad sales teams. We plan to offer brand advertisers multi-platform advertising solutions which simultaneously cover television, Web and mobile. NBCU has very successfully implemented the so-called 360 degree packages in the U.S. And I feel the time is right in India to implement the same strategy that will enable advertisers to reach their audience seamlessly across all three screens through creatively designed campaigns. I’ve spoken to many major ad agencies in India, and they’re eager for someone that can bring premium & popular content on digital platforms to lead in this area.

In terms of ad formats, Vdopia will sell targeted advertising with popular and standard formats including pre-roll, mid-roll and post-roll video ads, display, video player skinning, sponsorships, etc, as well as other innovative formats that Vdopia intends to introduce in the market.

If you can make money out of streaming a live TV feed on the web, can this also be done for news? Are you considering this? Within sports, will you consider streaming live other sports such as F1, Tennis, etc.?

Absolutely. Today there is very little premium video content on the Web in India. High distribution and hosting costs and limited bandwidth infrastructure in the country has restricted the growth thus far.

But things are changing fast. Given digital, though currently small, is the fastest growing advertising medium in one of the most exciting ad markets in the world, I believe the demand for premium content online amongst brand advertisers will be very high. The obvious advantages being that advertisers can target & track their audience and see a clear return on investment of their marketing dollars. In a market where print, which provides very limited targeting & measurement, controls over 40% of all advertising, there is potential for those dollars to shift to digital platforms as they gain reach.

Many news companies (NDTV, etc.) are already monetizing their news content online. Keep in mind, any revenue generated by traditional media firms in India on digital at this point is mostly incremental. This is television content that is being re-purposed for digital, and original investment by content owners is being recovered on television.

Yes, we’ve plans to offer other live sports as well. The next likely candidate is UEFA Champions League soccer, which Ten Sports currently carries on-air in the region.  We’ve now established a very scalable platform to offer sports fans great sports coverage online. The first obvious target would be sports currently carried on-air by Ten Sports, but we also intend to secure digital rights for other sports that may not be carried on television by Ten Sports. 

With your live feed, is the viewer also gonna be able to pause, rewind etc? Or not? Could you explain the precise technology you are employing?

Users will be able to stop and re-start the live streams. But they won’t have DVR capability with live streams at the launch. As mentioned before, we’re holding off on deploying more advanced technical innovations for now, given the early stage of live video streaming in India. NBC Sports has implemented many such features in the U.S., so it’ll be easy for us to bring that experience and capability to the Indian market at the right moment.

Sep 7, 2009 9:12 AM ET

Sab Kanaujia


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