Our all-video future: This week Paul Ford and Rich Ziade talk to David Mendels, the CEO of the video-hosting platform Brightcove. They discuss video’s rise and its current dominance on the web, eSports, “snackable video,” Rich’s relationship with his cable bill, and Pokémon GO. (“There’s a Bulbasaur by our bathroom,” Paul says of Postlight’s offices. “That’s our recruiting strategy.”)
Paul Ford: Well, Rich, we’re back.
Rich Ziade: Finally.
Paul: I’m Paul Ford.
Rich: Everyone missed us, I can tell.
Paul: Yeah! I’m Paul Ford.
Rich: I’m Rich Ziade.
Paul: There we go, we got it, we are all set. This is Track Changes, the official podcast of the Postlight product studio in New York City.
Rich: Based in New York City.
Paul: Yeah. If you wanna get in touch with us, email [email protected]. We have a two-parter episode today.
Paul: Recently on the show we talked about video, just in general, and Facebook video in particular.
Paul: And we got a lot of response about it, and it turns out that video’s like, the big subject.
Rich: Well, you know, as you’re describing this, you know, what’s echoing in my head is how much media — lowercase, generally — is obsessing over video, because there’s so much money there.
Paul: That’s the thing — there’s a reason why video’s everywhere, and that’s because advertisers will pay, in particular to put pre-roll ads.
Paul: Ads that appear before the video.
Rich: You know, I’ll tell you, if someone is talking to me sometimes, and this is gonna sound obnoxious, but it happens: I’m not interested in what they’re saying. I might not know them that well, and they’re telling me about their project or their life or something, and it’s just not interesting…
Paul: You’re a little tuned out.
Rich: I’m not only a little tuned out, but I think my brain has programmed itself a little “skip ad” button.
Paul: Yeah, I want to scroll ahead.
Rich: Shows up, sort of, below their right sleeve.
Paul: Yeah, that’s right. You just wanna — you wanna get —
Rich: I want to go on to the next thing.
Paul: 30 seconds ahead, talk about their kids instead of —
Rich: It’s kind of terrible, actually. I can’t sit through 90 seconds of someone telling me about their kid’s ballet class.
Paul: Well we…our relationships with media, like, we don’t talk about it very much, but we have these intensely personal relationships with media.
Rich: And I think they shape us, and they shape our tolerance.
Paul: Aw, like “The Late Show with David Letterman,” right? Like, people knew David Letterman.
Rich: And they miss him.
Paul: They miss him, right? You don’t really have those relationships with video, and with, like, Facebook. But you kind of do, too, but it’s not like with Facebook, it’s not even with the people who are using Facebook. It’s like, in the middle.
Rich: I’m finding my willingness to stomach something of depth to sort of be diminishing. I think that’s a problem.
Paul: Let me ask you something: have you ever, you ever quit Twitter?
Rich: You know, I don’t, I’m not a heavy Twitter person, so I wouldn’t say there’s, it’s not a big event for me to quit it.
Rich: Like, to quit it. I mean, you’re, I’ve seen you on Twitter. You’re, you’re…
Paul: A nice way to put it would be “engaged.”
Rich: Engaged. You’re pretty…you’re pretty intense on Twitter.
Paul: I get, it’s a huge sense of relief every time I quit. I quit quietly, I don’t do a, like, a storm out.
Rich: You don’t announce it?
Paul: No, because I figure the problem’s with me, not with the world. Like, I just can’t take it anymore.
Paul: I’m just, like, this is all — I hate everyone, I find them excruciating. That’s on me. That’s actually not on them. They’re just tweeting.
Rich: Do you find yourself even processing what’s happening — I feel, sometimes I’m finding my thumb is just moving the stuff up…
Paul: It’s impossible with the election. Like, I follow a couple hundred people, and that is so much signal. Most people follow, you know, a lot of people follow thousands. It’s impossible.
Rich: That doesn’t even make any sense. You’re not getting anything of meaning at that point.
Paul: No. It’s just noise. So…
Rich: It’s just noise…you’re just…yeah…
Paul: Anyway, we’re talking about video, and then later in the show we’re going to talk to someone named Dave Mendels.
Rich: David Mendels, that’s right.
Paul: Who is that?
Rich: He is the CEO of a company called Brightcove.
Paul: What does Brightcove do?
Rich: So Brightcove is…probably the big player in, I guess you’d call it, private-label, or white-label video platforms. So if you go to, and I don’t know if this is the case, I think it is the case, if you go to ESPN and you hit “play,” ESPN didn’t make their video player. And they didn’t make the whole system that sticks a, you know, Toyota ad before it, and tracks the analytics…all the tools that you need to run video, they’re effectively leasing our Brightcove’s technology.
Paul: You know, and that’s really what we should be talking about, before he comes in the studio, is how powerful and how big these platforms are that everybody uses.
Rich: They’re a big deal, because there’s a lot of money flowing through ‘em.
Paul: There’s Brightcove, there’s one called Cinecore that we know. There’s one called Akamai.
Rich: Akamai is not a video platform, though.
Paul: But it’s cache, I think it also has video.
Rich: I think video’s a big part of the story for Akamai, but I think they’ll cache anything.
Paul: Right, so this is really interesting, though, like how do we differentiate between these worlds? A video file and a video streaming provider, and a video whatever — these are just files.
Rich: They’re tools. Well they’re tools to serve up those files and serve ’em up quickly, and the experience to be really amazing. You know, as I’m thinking about the ESPN bit, it is a bizarre thing to get a video loading into the top of a page and then an article, and I look —
Paul: Oh because if you go to ESPN, so many pages do that.
Rich: And beyond ESPN, too. It’s a very strange experience. It’s like —
Paul: A minute and a half —
Rich: Wait a minute, do I read?
Rich: Or do I hit play on this video.
Paul: What are the words for?
Rich: Usually the video sort of encapsulates, they’re usually short, one minute, 90 seconds — that’s the other thing, I think, there’s a general trend of videos just getting shorter and shorter. CNN does it as well.
Rich: CNN also puts a video up top and then there’s an essay below, and it’s, imagine somebody, you know, you open your book and then all of a sudden somebody’s standing in front of you, yapping in your ear while you’re trying to read. It’s very strange to me, but you know what, I don’t think it’s driven by user experience. I think it’s driven by sales. Just raw sales.
Paul: If you’re a company that publishes things on the internet, you have, usually, your own software or you’re maybe licensing something that lets you compose articles, that’s your content management system.
Paul: You tend to have a pretty high degree of control over that.
Paul: And you compose the words in it, and you publish them and so on. If you host video, you tend almost invariably not to have control over that.
Rich: Almost invariably. It’s a different game.
Paul: You use a different kind of service — now you create videos, you put them in the service.
Paul: But why is that? Why do people use these sort of platforms instead of building, using ones that, you know, like, getting some open-source software called VideoHoster2000.
Rich: Well there is, actually, a very, it’s almost competitive at this point, which is JW Player, which is, has a pretty big presence in off-the-shelf, turnkey video platform that people can use.
Paul: What do you use that for? What is that?
Rich: That is, it’s if you don’t want to go the corporate route, you can get, you know, a license for JW Player, which is essentially just a player.
Paul: It’s an open-source tool, right?
Rich: It’s open source, but there’s a pay model around…it lets you skin it…
Rich: So if you’re…
Paul: Like Winamp.
Rich: Sort of like Winamp.
Paul: No, but I mean, what we’re talking about here is that, you literally are saying, like, this rectangle on this page, I’m not gonna have full control over that. The stuff here’s gonna come from some other place on the internet.
Paul: And you do that also with online ads, with banner ads and stuff. You don’t, those rarely come from your company.
Rich: You know, a lot of the pieces on the page don’t come from you.
Rich: Anymore. [laughter]
Paul: Yeah, it’s true.
Paul: It’s true. You might —
Rich: Tons of stuff is flowing in, poured in from other places.
Paul: I mean, if you open a web page, any big site, I don’t know, like the Times, or…or CNN, and you look at where stuff is coming from…
Paul: Your single homepage load might hit 30 or 40 different servers, like 30 or 40 different computers are involved in making —
Rich: It could very well —
Paul: Making one webpage. From all around the world.
Rich: It’s exhausting.
Rich: And it could take 20 seconds to load an article that has 600 words in it. It’s kind of bananas.
Paul: Well this is where you see Google AMP popped up, right?
Rich: Google AMP is a play —
Paul: Instant Articles —
Rich: Instant Articles — hey, enough with making people wait 12 seconds to see a few words. It got silly.
Paul: Let’s kind of all put it into one place.
Rich: Also the adblockers, a lot of people use the adblockers not because of the ads. The ads, actually, it’s become a lot better behaved out there, like if you look at what a New York Times article page looks, it’s not bad. It’s just the speed at which a page loads, by cutting out all that sort of under-the-hood third-party stuff that’s coming in —
Paul: Yeah, because no matter what anybody does, it’s easier to talk to one or two computers than 30 computers.
Paul: And that’s — the talking is being done by your web browser.
Rich: That’s exactly right.
Paul: Or by your mobile browser, or by your app, or whatever.
Rich: That’s right. I mean, they did studies, but they didn’t need to do studies. Like, Facebook gets this, right? Instant Articles — the fact that videos don’t even, you don’t, there’s no play button. They just go. It’s just me opening my gaping mouth and then just stuff pouring in.
Paul: I mean, this is the great —
Rich: Maybe there’s a better way to say that.
Paul: Nah, it’s the best way to say it. Well Rich, right —
Rich: Speaking of just consuming tons of video in a zombie-like fashion…
Paul: So what our, what our…
Rich: Wait, there’s a better way to connect this to the CEO of Brightcove.
Paul: So what our listeners don’t — [laughter] What our listeners don’t know is that a minute ago, the door opened and someone walked in.
Paul: And this is someone that Rich has told me a lot about. I’ve never, I’ve never met him before, but his name is David Mendels.
Paul: And he is the CEO of Brightcove.
David Mendels: Hello.
Paul: Good to have you, thank you. Welcome.
Rich: David, welcome. We’ve been talking about video, before you got here.
Rich: And just about how it’s, it’s just impacting everything we see. We have a lot of media clients, and it’s just a big deal. Um…so…it’s…
Paul: So this is great.
Rich: It’s great to get this perspective.
Paul: We can go right to the heart of video for the entire internet.
David: All right.
Paul: So Brightcove’s in Boston?
David: Our headquarters is in Boston.
Paul: OK. And how old is this company?
David: 12 years old.
Paul: What does it do? Assume I am a child. [laughter]
David: We help people deliver video experiences.
Paul: That is the one thing that Brightcove does?
Paul: I mean, that’s the big thing?
David: Yeah. I could explain a little more, but that’s basically what we do.
Paul: When you say people, what kind of people?
David: I mean, I mean companies, but really, almost any kind of company you can think of, or organizations. Media companies that obviously have a lot of video.
Paul: Mmmm hmmm.
David: Like Comedy Central, or USA Today.
Paul: Mmmm hmmm.
David: But also churches. The Mormon Church. Brands like Ford Motor Company, or Bank of America. You know, really, any kind of company, any kind of organization you can think of wants to communicate with someone, and video’s a good way to communicate.
Paul: So the Mormon Church comes to you, they go, we have thousands of hours of video.
David: They have a lot more than that.
Paul: More, OK. So, incredible amount of video.
Paul: Things like church services.
Rich: Why wouldn’t they use a YouTube? Why do they come to you, like, what’s the, what’s the distinction here?
David: Well there’s many things that they do, so I’ll just talk a little bit about one aspect of what they do. Twice a year they have what they call their General Conference, which is 48 hours over the weekend of live broadcasting from Utah all around the world. It’s gotta be one of the most complex video production things anybody does anywhere. They deliver the video in 80 languages.
Rich: Oh my good — simultaneously?
David: Roughly, I mean there’s a little bit of a delay for translation.
David: So in that regard, it is the most global, most international thing I think anybody on the planet does.
Rich: That’s interesting.
David: And when you think about what the Mormon Church is trying to do, that makes sense. So they’re delivering, you know, 24, 48 hours of live video streaming, all around the world, and in real time, slicing that up into hour-long segments, into clip segments, and then putting that back up as VOD, video-on-demand. It’s a really complex operation. They also use YouTube, for playback, for some things —
Rich: Mmmm hmmm. Mmmm hmmm.
David: But YouTube isn’t anywhere close to providing them with sort of the enterprise workflows and the tools that they need to deliver this stuff.
Rich: Got it.
Paul: So do you —
David: But also wait, wait, there’s another key point here. YouTube puts ads on things. This is a church.
Rich: Got it.
David: They want 100% control of their experience.
Rich: Got it.
David: They don’t want the YouTube brand.
David: They can’t go out and promote another brand. They’ve got to promote their own brand.
Paul: So if you go to this event, there’s, like, a big classic video-editing suite and people are just cutting and pasting video in there, and like, it looks like a newsroom, it sounds like.
David: Yeah, it, you know, their operation looks like, you know, ABC, NBC, CBS kind of delivery.
David: A little smaller, but…
Rich: That’s interesting.
Paul: Do they reach out and then you send someone who’s like, OK, let’s figure this out for you, or how’s, how’s this work?
David: It’s a wide range. Our products can be consumed in lots of different ways. They’re technical products, they’re cloud services, if you will, they can be consumed via an API. We have customers where a developer comes in and integrates us into a larger publishing system or a larger production system, and goes and really almost never talks to us. We have other customers who want our help, and we sort of help them through all that, and hand-hold them and the like. So there’s lots of different ways that people can work with us, really depends on what they need and what they bring to the table in terms of how they want to use us, what skill sets they have.
They could also use great New York development shops. I don’t really know any, but, uh…
Rich: We know a few.
David: If I were to know one.
David: All right.
Rich: Well, since you mention, David. [laughter]
Paul: We promote ourselves enough. We’re terrible. But OK, so I go to a website on a Time Inc. property.
David: Uh huh.
Paul: You mentioned them. They’re also a client of ours.
Paul: And you see a rectangle on that screen with some video in it.
Paul: What’s happening inside that rectangle?
David: So it sounds pretty simple, when you call it a rectangle, right? You know, it’s a rectangle, and there’s also a triangle, by the way, that’s a play button. [laughter] So sounds like there’s not that much that’s going on, but there’s actually a lot going on. The video player has a lot of layers of software and policy. It’s a mini-operating system. It has to know what video to play, security or geo-restriction rules, there may be other user-experience things, like what’s coming before, what’s coming after, is there a bumper, is there a, a recommended video or an end screen at the end. It has to know whether to start pre-loading the video, so that when I hit play as a viewer, it starts instantly, or maybe I don’t want to incur that cost, in which case I won’t pre-load the video or some segments of the video.
It then has to, in the case of a commercial media company like TIME Inc., it’s gonna start by calling out to an ad server, like Google’s Doubleclick, perhaps, or there’s others out there, and get an ad, and it has to then stop the video, play the ad, stop the ad, play the video, and there’s a lot of technology in how that all works.
Meanwhile, that same rectangle, if you will, it’s a piece of code actually, is emitting beacons of analytics, which are going in multiple directions. So you’ve got analytics that we provide on viewership, on geography, on platform. They may also be integrated with third-party analytics like Omniture, Google Analytics, they might have created something custom with a service like Mixpanel or any of those things. They might be using other analytics like Nielsen, Comscore. So there’s a whole range of things that can be plugged into that rectangle that add different kinds of value for a company like Time Inc.
Rich: That’s an incredibly good answer.
Paul: That was great.
Rich: I’ve just gotta say, you’ve talked about this before, I can tell.
David: Well it’s a rectangle. [laughter] I could’ve just said, you know, right angles.
Rich: Pretty colors. We were talking about this before you arrived: the footprint of video, and the influence of video in digital media is just growing. It’s just contiuing to expand. And I don’t think that’s driven by altuism, it’s driven by money. There’s really good money in video content.
Paul: And we, we know because we’re being asked to build more and more video experiences.
David: Well I actually think it’s being driven by consumers. Humans want to consume information, education, communications, religious information, whatever it is.
David: And most humans, for many things, prefer video as a format.
David: And therefore there’s money in it. Not the other way around.
Rich: That’s fair. I didn’t mean to make it sound sinister, David.
David: No, I wasn’t saying that. [laughter]
Rich: Yes, yes, those are the drivers, but a TIME Inc. or a — who we love, by the way — are finding opportunities around that demand.
David: Yeah, so you take an organization like TIME Inc., you know, hundred-year-plus old company, great company, great brands that built their empire entirely on print.
David: And it turns out when you go to the internet, you can do text, and you can sell advertising associated with that text, but advertisers will pay you a lot more for video.
David: That’s what’s driving it from —
Rich: Why do you think that is?
David: A business perspective.
Rich: Boil it down.
David: Video has an emotional impact that static images and text don’t have. People —
Rich: You know, Paul Ford’s a writer, by the way. You just, you just, like —
Paul: That’s fine.
Rich: Put a knife through his heart.
Paul: No. I’ve made my peace. [laughter]
David: When I say text, I’m not necessarily referring to literature, but whatever.
Paul: Don’t…don’t worry about me. [laughter] Don’t listen to him. Don’t listen to him.
David: But you know, people who are trying to communicate, and that’s what marketing is, it’s trying to get someone to be interested in something, they want to create an emotional impact. They want to create a connection…
David: And video does that very well.
David: And we have 70 years of TV history where people experienced what the power was of advertising and TV creating a brand.
David: And everybody wants to figure out, all right, how do I do that now?
David: In the internet world.
Paul: How does Brightcove make money?
David: You mean you’re not paying me for this appearance?
Paul: No. [laughter]
David: Is that not how I do it?
David: All right…
Paul: Well… [laughter] Hmmm.
David: Anyway, we are a software company. Pretty straightforward. So we build software for people to create these video experiences, and they pay us to use our software on a subscription basis. It’s what’s known as cloud software. If you’re familiar with things like Amazon Cloud Services, AWS, you can think about us as a layer above that, so they sell computing, they sell storage, they sell database, they sell relatively low-level atomic kinds of computation and value to people. And then we create a layer of, we can convert videos from one format to another. We can play back videos. We can insert ads in videos. We can do analytics —
Rich: Sounds like you do a lot of livestreaming —
David: We do liverstreaming as well, yes.
Rich: OK. Are you on top of AWS, out of curiosity?
David: Mostly, yeah. We also use Google Cloud for some things.
Rich: That’s really interesting.
Rich: Very interesting.
David: When we started 12 years ago, we built our own data centers. AWS wasn’t really ready.
Rich: So your bill must be nasty as all hell when it comes in.
David: Yeah. [laughter] That’s a fair statement.
Rich: That’s one of your line items.
Paul: Although I assume that Amazon gives you a phone call if things are going wrong, too, though.
Paul: I’m imagining they know who you are.
David: They know who we are, but it’s a $10 billion business, the Amazon Web Services. And so we are not a significant percentage of that.
Rich: We inevitably end up talking about Facebook when we talk about media.
Rich: And video has become a pretty significant, if not prominent, I don’t know, maybe because of my feed, part of Facebook.
David: Yeah, absolutely.
Paul: I mean, Facebook must be one of the largest video platforms in the world.
David: Oh, absolutely.
Paul: Maybe, you know, it only compares to YouTube at this point I guess.
David: Yep, and well, depends on how you measure large. In terms of actual number of bits delivered, it’s probably Netflix.
David: Well, YouTube and then Netflix.
Rich: And I gotta say, something is broken in the experience — I’m just gonna vent for one second. I would see a panel that talks about a vigil for slain police officers, followed by a 30-second video recipe for watermelon margaritas.
Paul: It’s complicated.
Rich: It’s really complicated.
Paul: It’s not really a media experience, it’s a feed.
Rich: Yeah…when you say “feed,” I think of, what’s that, you know that scene where all the pigs are just eating out of the trough?
Paul: I don’t know what that scene — what movie that is. [laughter]
Rich: It’s a foreign film.
Paul: Yeah. Yeah. You subscribe to the Criterion Collection on Hulu.
Rich: All right, so —
Paul: Le Pig.
Rich: Teeing this up for you, David.
Rich: I mean, do you have a relationship with Facebook? What do you think of Facebook?
David: We have a relationship with Facebook.
David: The way I see it, we’ve seen media companies want to reach people where they are. They also want to keep control over the experience when they can.
David: And so we have a view of the world that we should make it easy, frictionless, for a company to deliver their video content to any of those endpoints. So when you ingest a video into our product, our core product, video cloud, we can then help you play that back with our player on your website, in your iOS app, in your Android app, on Roku TV, on a Samsung TV, all these different things. But we can also then manage for you pushing that into Facebook, YouTube, Twitter.
David: We can manage the release windows, the geo-restrictions, the calls to action. We can then get all those analytics from multiple social platforms, and pull it all back together, so that —
Rich: Oh, that’s really nice.
David: You, TIME Inc., can have a view of all your video vides in multiple places.
Rich: That’s pretty cool.
David: So if we were to take a point of view that we were just about how to play the video on your website, that would still solve a problem for people.
Rich: Mmmm hmmm.
David: But the real problem is, how do I show video to people who wanna watch it? And how do I should video on my website?
Rich: Does Facebook terrify you?
David: No. The great thing, in a self-serving way, about the fact that there is not just Facebook, but Facebook, and there is Twitter, and there’s YouTube, and there’s Snapchat, and the other, is that creates complexity for anybody who wants to reach an audience. And as a software company, we’re here to solve complexity, so it creates an opportunity. If there was only YouTube in the world, or only Facebook in the world, there’d be less complexity. It’d be an easier problem to solve; we would be less valuable.
Rich: I think you could drive a cult. He could lead a cult, I think.
Paul: He’s very —
Rich: The responses are just dead-on and I’m trying, I’m trying to…
Paul: No —
Rich: Get him to sweat a little bit.
David: Can I take that as a compliment — that you don’t think that we are a cult already?
Rich: I don’t think that you are… [laughter] That’d be really interesting if Brightcove was a cult.
Paul: Kind of actually has a cult name, really. I mean, you just put a space, like, “Come to the Bright Cove.” [laughter] Yeah, yeah.
Rich: Two words.
Paul: Yeah, and there’s just sort of like a guy with horns on, you know, and a little light.
Rich: So you’re sitting, you’re perched in an interesting place. You’re sort of watching this evolution, revolution, video, you know, what’s happening with video — you’re seeing it happen, right? Because you actually get to sit above a lot of these verticals, a lot of these sort of brands, and whatnot. What do you think is happening, and where do you think things are going? I mean, as a consumer, I find myself watching videos I didn’t even hit play on, and then after about 12 minutes, I’ll notice there’s, like, there’s dried spit on the corner of my mouth.
Paul: Well, let me, let me reframe that a tiny bit, like, we’re seeing, from our vantage point, which is very specific and very small, but not broad, that there is all this interest in video. Is that, over the last year or two, are you also seeing this, like, tremendous uptick?
David: Yes. But it’s…I’m not sure how much the slope of the curve has changed. We’ve seen incredible interest really from the beginning. The use cases, the needs, the complexities, the platforms have changed, but the desire of a wide range of organizations to entertain or communicate or whatever, or teach, via video, that’s near-infinite. You can really apply it to almost anything.
David: What’s happening, it’s, you know, video being the most powerful media, medium that humans have created, combined with the open internet, is the two together enable this incredible proliferation of new forms of communication. And so it’s just gonna keep going, and the challenge is all right, how do we continue to improve the quality of the experiences that people have consuming these things, and then also in order for this to really happen, we have to continue to make it easier and much lower cost. If we instantly said let’s take all of broadcast video and put it over the internet, we’d break the internet today, and it wouldn’t work. So there’s still a lot of technology and things that need to get developed over the next five or ten years for this to work.
Paul: Do you see new kinds of sort of consumer- or user-created video showing up? Is that sort of —
Paul: That’s gonna just keep growing?
David: I mean, so, as a person who is not a millennial, which is, I’m not, the most crazy thing from my perspective, although it’s an incredible industry already, is eSports. It’s people recording themselves playing video games, talking over it, and broadcasting that around the world.
Rich: It’s fascinating to me.
David: The scale at which it’s occurring, this is already a year or two old —
Rich: Is that what it’s called, by the way? ESports?
David: That is what it’s, that’s what it’s being referred to…
Rich: I did not know…
David: The League of Legends championship, I think this is over a year old, this might be from two years ago, I can’t remember when I got this metric, had more viewers than the Major League Baseball World Series and the NBA final combined.
Rich: Unbelievable. Unbelievable!
David: To watch people play League of Legends. And when you watch it, it’s exactly what you think it’ll be. [laughter] It’s people playing video games!
David: Like I could watch my kids do it in the living room, with the Xbox and the like. But it’s astounding, the scale is really…so that’s a form of user-generated video. There’s obviously many, many forms, but…
Paul: But just a whole new world just shows up there.
Rich: Are we losing our minds a little bit?
Paul: I think it always looks that way, right? It always looks like this new thing shows up, and you’re like, well that’s just impossible. Like, Pokémon Go shows up a couple weeks ago, right?
David: Pokémon Go’s cool, though.
Paul: It’s very cool. It’s very cool, but a lot of people are like, what is this nonsense? And I mean, I’ve, I have little kids, and it was great.
David: Me, too.
Paul: We ran around.
Paul: And we played Pokémon Go. But other people see a bunch of people walking around, looking at their phones, and they’re like, look at those losers.
Rich: Yeah. Right. True.
Paul: It takes a while.
Rich: It takes a while. That’s very true.
David: Yeah. Pokémon Go, I think, that really did something. They weren’t the first to do it, but the first to do it at scale, where they combined moving around in the real world with this virtual experience on your device, and it’s wild to watch. I have a 13-year-old, walked over 10 miles last Saturday.
David: I checked his steps on the…
Rich: My goodness.
David: On the iPhone afterwards.
Rich: In the neighborhood?
David: He asked me to drop him off in downtown Boston, at… [laughter] What’s that, the duck pond, right?
David: The famous place, and he basically traversed the entire city with a group of four 13-year-olds. They went to the North End, they did the Freedom Trail, I mean, everything. They saw the entire city — well, they didn’t actually look at anything but their phones. [laughter]
Rich: They saw none of the city, in fact.
Paul: No, they saw the —
David: But they walked over 10 miles.
Paul: They saw the city through their phones.
Rich: Well that’s good.
David: It’s amazing.
Paul: No, they were ambiently in the city. I mean, most of the time —
Rich: No they weren’t —
Paul: You’re not, like —
Rich: But you’re not looking up, right? Probably?
Paul: No, but you’re actually seeing…it’s mostly reality, through your phone, and then there’s a couple little animals superimposed. It works OK.
Rich: OK, fine.
Paul: We’ll do it, we’ll go back to the office and play some Pokémon Go.
Rich: Fine. I don’t want to — I mean, we’re a technology company, I can’t sound like an old curmudgeon here.
Paul: No, there’s like a Bulbasaur by our bathroom —
David: That’s cool.
Paul: Yeah, yeah, we’re doing good. That’s our recruiting strategy. [laughter]
David: I hadn’t thought of that.
Paul: No, it’s good.
David: That’s a great idea.
Paul: Set up a lure.
David: We ought to put that on — we have a lot of open positions, by the way. [laughter] I should mention that.
Paul: Actually, no, let’s hit pause for a second: what are you looking for? Who should be getting in touch?
David: We have a lot of different kinds of positions. Engineering, software development positions, you know, to build things. People who know video encoding. People who know how to build web front ends, or full-stack developers. We have openings working with our analytics team. Very complex big-data operation, you know, ingesting 20,000 events a second, and then having to process that and manage that.
David: So lots of engineering positions. We have sales positions in London, in New York, probably other places, I don’t know them all off the top of my head. Got product marketing kinds of jobs in Boston. So wide range.
Paul: So that is, that is the definition of a growing company, what you just said there. That’s very interesting. OK.
David: We added 50 people so far this year.
Rich: Oh wow.
Rich: Wow. That’s good, considering how difficult it can be to find people.
Paul: It is hard.
David: And the fact that not everybody stays forever, which we’ve tried to lock them down, but you can’t.
Paul: No, they wanna have lives and live them. We run into that situation as well.
Paul: You just let them go.
Rich: Yeah. I mean, they talk about Yellowstone, what are you gonna do?
Paul: That’s, when somebody is like, shopping for a backpack with a lot of compartments… [laughter]
Paul: We should really block REI at the office. [laughter] That’s the…
Paul: When they’re thinking of that hiking trip. There’s a question I really like to ask people when we talk to them, which is, you are the CEO of a software company. What do you do all day?
David: That’s a good question. If I tell you, people might know.
Paul: Fair. Very fair. [laughter]
Rich: You can dodge it if you like.
David: No, no, I divide my time roughly between three sort of broad categories of things. If you looked at me, what I do all day is I’m on the phone or I’m in meetings or I’m walking around my office. I walk around a lot; I don’t sit still much. This is the longest I’ve sat for a long time. Anyway, but the three things —
Paul: It’s only been like 15 minutes.
David: I’m either dealing with customers, existing customers or new sales, we’re talking to them about what we’re doing and what their problems are, trying to resolve issues, whatever. Or I’m working with the product and engineering team, and talking about what are we building, how’s it going, what are our plans, what have I heard from customers, what are they hearing from customers, where are we going next. So sales, product, and then the last is my least favorite, but it’s an important part, is talking to investors, dealing with the financial side of the company, understanding where we are. Also hiring people.
Rich: Oh, interesting.
David: A good chunk of time goes into recruiting.
Paul: How many hours are in that day?
David: A lot.
David: I don’t know, you know. A lot. I don’t turn off very much.
David: I don’t sleep a lot, and I like my job. So I’m on a lot.
Rich: Again, going back to, you know, being where you are as Brightcove —
Rich: And sort of getting a nice perspective on video in the world, where do you think things are going? What’s the experience like in two years, four years? Based on what you’re hearing people wanna do, and maybe the technology isn’t there, or….?
Rich: What’s sort of taking shape?
David: It’s hard to answer that in a simple way, because there’s so many different things that are happening. So I think we’re gonna continue to see the movement of video online into a wide range of a la carte, niche, and general OTT services, subscription services and the like, that are gonna continue to disrupt traditional entertainment distribution models. And effectively, what we’re seeing at the broadcast level of video, and there’s so many different kinds of video that you gotta really think about differently, is everybody’s now really planning on a future where everything is IP-delivered, and broadcast goes away. And how does that work.
Paul: Tell our readers what that means — or listeners what that means.
David: It, you know, it’s sort of a fundamental rethinking of the infrastructure of broadcast to be internet-first.
Paul: Mmmm hmmm.
David: Not we’re gonna broadcast stuff and then take that file and —
Rich: Let it trickle down.
David: Retranscode it, and then put it back out into video, but everything will be internet-first. So that’s just a foundational thing that’s happening.
Rich: I mean my ca — I’ve had this debate with my wife maybe every three months: my cable bill’s $200 a month.
Paul: Mmmm hmmm.
Rich: I think I watch two channels. Maybe three.
David: Well so, so I think there, it’s very interesting, and I have no idea how it will end, but a lot of people feel that way. They watch three channels, four channels, five channels, they spend $125 bucks, or maybe $200 a month. And so the presumption is, I’m getting 500 channels and paying $200, if I could just get the three or four I want, it would only cost me $20.
David: And it doesn’t work like that at all. [laughter]
David: And the reason that you’re about to get all those channels is that most of them aren’t worth very much, but they’re bundled in and —
David: You know, you’ve got scale. If you unbundled and you decoupled all of those things, you would end up spending as much or more in many cases.
David: And then on top of that, there’s all this other video that you consume in your life, and a lot of the people creating that — that aren’t necessarily the TV channels that you watch, but if you go to TIME Inc. or you go anywhere else — and a lot of those companies are struggling with their business model. Can I make enough money with advertising, given the fragmentation of audiences and the fact that so much of the ad dollars are being accrued into just a few companies in the world, Google, Facebook, primarily. So they’re all experimenting with subscription-based models.
Paul: Mmmm hmmm.
David: So everything you watch in your life, somebody’s gonna try and tell you you should spend $5 a month for.
Rich: [laughter] Right.
David: It’s gonna — if it keeps going in that direction, it’s very quickly going to be a lot more than $200 a month.
David: And then you’re gonna see the pendulum swing the other way, where there’s gonna be aggregation again in bundles, because that’s the way you can put this stuff together in a way that makes sense. The great news, though, is it’s leading to the golden age of content, because all these people are competing to create the winning subscription service.
David: So Amazon’s spending huge amounts of money, Netflix’s spending huge amounts of money, HBO is…and they’re creating all this great content.
David: I worry about what happens when the pendulum swings the other way, if we’ll continue to have such a golden age.
Rich: Yeah, it’s — we’re in the middle of change, right? Pretty dramatic change, in terms of how things are structured and where content comes from and where it ends up and the like.
Paul: And there’s a lot of work right now. There’s just a ton to do.
Rich: There’s a ton to do, because it is, I mean, I think there is that activity, that’s sort of kind of happening even in between the spaces, in between the big players. People are getting funded to, you know, put together a five-hour thing.
David: Absolutely. There’s all kinds of great stuff being made.
Rich: Yeah, very cool.
Paul: What I’m trying to wrap my head around, sort of relevant to what you said earlier, is that you have these bit editing suites, and you have these sort of files moving around that are basically sort of inheriting their structure from recording on videotape, or recording on film, and now the world’s gonna look more like Facebook Live, but all these channels kind of coming together and being mixed and cut up kind of in real time, kind of not, like there’s —
Paul: All that stuff, and that’s such a really fundamental shift. That’s like the difference between The New York Times in 1997 and Twitter today.
Paul: That’s a huge difference.
David: The whole idea of creating a channel is something that 15 years ago, you were talking about millions of dollars of capital up front to create something like that. And now, you can create a virtual channel in software where you’re dynamically assembling clips into a 24/7 stream for effectively, you know, approaching nothing.
Rich: Incredible. I still want out of that bill, though.
Paul: Yeah, we’ll get you there.
David: No you won’t.
Rich: No, I don’t know if I’m gonna get out of it.
David: You’re not gonna get out of it. In order to create the content that you like, so far, there’s only two ways that people have figured out how to fund that. They can sell you a subscription, like HBO…
Rich: Or ads.
David: Or they can put advertising on it.
Rich: Or both.
David: Or both, exactly, like Hulu, and the like. And so you’re gonna pay for it one way or the other, or it goes away.
David: That’s the challenge, I mean, you have a lot of interest among consumer in adblockers —
David: Which is…frankly, there have been a lot of terrible advertising experiences created on the internet.
David: And hey, if I can block it, why wouldn’t I? Whether it’s terrible or not.
David: And yet, it fundamentally breaks the social compact that we’ve had for, you know, with TV for a hundred years, which is yeah, you know, you’re giving me this TV content for free, but in exchange for that, I watch whatever it is, seven, eight minutes every half hour of commercials.
David: And if you don’t accept that, you have to pay for everything, or you don’t get it.
Rich: Yeah. Yeah.
David: At some point it breaks.
Rich: We’re seeing that kind of tension kick in now. You got these sort of, you know, the adblock messages that come up.
Rich: It’s like, I see you’re using an adblocker. Can I talk to you for a second?
Paul: About what great journalism means.
Rich: Could you come over here for a minute? I want to talk to you about something. [laughter]
David: Yeah. I really feel like it’s an issue for, fundamentally, for a free society.
Paul: Mmmm hmmm.
David: That if people only get content that they pay for explicitly, then you have no shared culture, you have no shared journalism, you have no open flow of news and information that is necessary for a healthy society, democracy, culture. So an ad-based model kind of has to work. And yet ads suck. And so I think that’s really a fundamental question that I don’t have the answer to, but maybe you guys can figure it out.
Paul: No, I mean, this is, when I talk to people who are talking about how to save publishing, which everybody always thinks they have a thesis, I’m like, better advertising experiences would be the best path.
Paul: And everyone is entirely demoralized, and I’m like, no, but that’s the real business, you know, the paper was always subsidized, you were getting —
David: Absolutely, right.
Paul: You know, this very heavy piece of pulp.
Paul: That was actually subsidized by the dress ads and the hi-fi ads and such.
David: The problem is that the marginal cost of creating a new city newspaper was high enough that even in a big city, you were only gonna have two.
David: Whereas the marginal cost of creating another website with some interesting content about Donald Trump is zero. And so the competition for those ad dollars and for those viewership is, it’s not even an order of magnitude different, it is a different phase, it’s a fundamentally different problem than we had —
Rich: It’s a different arena
David: In the legacy publishing world.
Paul: I’m gonna ask a really dumb question, but you might have a perspective on it, I’ve never thought about this before, but you know, the content that we’re seeing on, like, a Twitter or Facebook is highly atomized video, like, 30, 60 seconds. And then we’re seeing these enormous digital successes with episodic things like Game of Thrones.
David: Game of Thrones, yeah.
Paul: When you think about episodic versus, like —
Paul: Is there a name for the short video?
David: Yeah. The snackable video, that’s a phrase I’ve heard.
Rich: Is that the phrase?
David: Yeah, that is a phrase. I don’t hear it a lot, I don’t think it’s really completely caught on, but certainly it’s used some…
Rich: It’s real. It’s definitely a phenomena right now. I mean, there are people — I mean, even newspapers like the New York Post is putting together 25-second videos.
Rich: Because they assume you’re gonna fly by on the Facebook feed, that’s just what’s happening.
David: That’s Brightcove, the New York Post.
Paul: Oh, OK. Now do you guys host a lot of the longer episodic video?
David: We do, yeah. Short form, long form, we do very a wide range. Anything you could think of.
Paul: Now do you think about them differently as a company, or are they kind of the same thing but one’s longer?
David: There is some different technology and different things we have to do. It’s not so much that we interact in some fundamentally different way, but for example, for the folks that are distributing content from, you know, ABC, CBS, NBC, Disney, you know, FOX, HBO, especially outside the US, our business is very international.
Paul: Mmmm hmmm.
David: They need to apply different security, digital rights management, to all of that content. That’s the part of the licensed contract that you do when you do a deal with a US studio. And so there’s a whole bunch of work we have to do, and our customers have to do, and things that they have to pay us for, and we have to pay other people for, in order to supply that whole layer of technology.
Also with long form, you have other interesting technical problems, like putting a pre-roll on an ad, it’s a reasonably hard problem. Putting a mid-roll in a piece of long-form content is a much harder problem.
Paul: Sure, you’d be skipping back and forth, and…
David: There’s, you know, what do you do if someone scrubs past it? Do you snap back to the ad — there’s a whole bunch of things you have to figure out, both from a technical and user-experience point of view.
David: Analytics, people care about some different things, and so on and so forth. So there’s some differences with long-form content, sure.
Rich: David, this has been amazing. I really enjoyed this. Do you want to share a coupon code with our audience before we end the show? [laughter]
Paul: 20% off…
David: Yeah, I think, you know, if you reference this podcast, we’ll give you…um…a really good doughnut. [laughter]
Paul: Oh, that’s great. That’s actually more than more of our listeners have ever gotten from anything. [laughter]
David: I was with a customer this morning, and apparently one of our competitors shows up with doughnuts on a regular basis.
Rich: Seriously? Interesting.
David: I’m offering, I’m offering doughnuts who calls me and says they heard this podcast. [laughter]
Paul: Use the code “POSTLIGHT.”
David: OK, yeah.
Rich: There’s not even a box to enter it into.
Paul: Thank you so much for your time, David Mendels.
David: Thank you.
Paul: And if people want to get in touch with you, is there a good way?
David: LinkedIn. LinkedIn is probably the best way to do it, yeah.
Paul: OK. Look for David…
David: Just message me on LinkedIn and I will hopefully get to that quickly.
Paul: Well, Rich.
Paul: We did it again.
Rich: We did. This was great.
Paul: It was great, I learned an enormous amount. Did you learn a lot?
Rich: I learned a ton.
Paul: I learned, I have a ton to think about. Video is big and complicated.
Rich: I was gonna go back to work, but I think I’m gonna go straight home and lie down for a bit.
Paul: I’m just gonna go buy a camera and start livestreaming everything. [laughter] This has been Track Changes, the official podcast of Postlight, a product studio in New York City. You can get in touch with us at…
Rich: [email protected].
Paul: Very nice email address. We answer —
Rich: You could just say hi, by the way.
Paul: Yeah. We actually, we get lots of emails, we love them, we’re gonna start reading more of them on this show. I’m Paul Ford.
Rich: Rich Ziade.
Paul: And we’re very grateful to our guest, David Mendels, who is the CEO of Brightcove.
David: Thank you very much.
Paul: Bye everybody!