HTML5 is NOT a "Flash-Killer"
In the last issue of VOD Professional magazine, Florian Pestoni, Group Product Manager, Media & New Technologies at Adobe, wrote about the rise of TV over IP networks. For this issue I followed up with Florian to ask about monetisation, the threat posed to Flash from HTML5 and why Apple isn't using Adobe's products.
Kanji: Hi Florian. Can you tell us a little about yourself and what Flash Access is.
Pestoni: I'm the Group Product Manager working in the 'Flash Runtimes' organisation that includes Flash Player and Air across all platforms. The primary area of focus is around video and monetisation and a critical area of that is content protection which is where a technology like Flash Access comes in. Flash Access is a product which launched last year and one of the major differentiators for it as a content-protection or DRM solution is that it's built right into Flash Player and Air. So that gives content providers who want to distribute content securely and monetise it the fantastic reach of the Flash platform on all types of devices.
Kanji: So a video application doesn't need to integrate with any other DRM technology?
Pestoni: Right, it's built right in. For developers who are building video apps, they just need to make a couple of calls and in the backend run Flash Access server so that the content is protected and usage rights are only granted to the group of users that the business model dictates.
Kanji: And can you give us a real-life example of how this is being used?
Pestoni: So, VUDU is a company owned by Wal Mart and it recently launched a streaming service to PCs and Macs and what they were looking for was something that had broad distribution which didn't require the end-user to install any new plugins: something that was truly a web-based experience and that provided a high level of protection because VUDU licences really high-value content from all the major film studios. So they turned to Adobe for a solution based on Flash Player on the client side and Flash Access on the backend.
Streaming on PCs has been around for a while, but with technologies like Flash the user experience has improved dramatically. There's been a transition from external media player delivery (so using something like Windows Media Player) to true web-based delivery so you get that experience within the web browser.
Kanji: And what was the strategic thinking behind Adobe creating and building something like Flash Access?
Pestoni: That's a good question. We view Flash and Flash Player as a platform for rich content including video. If you look at the use cases for video there's a broad range - from UGC like YouTube, video-calls with services like Skype and Google Talk and premium video content which owners look to monetise. The need is to meet the content-owner's expectations. So introducing a product like Flash Access really allowed us to raise the bar in terms of security and content protection that we can offer to the extent that the movie studios who are members of the DECE or UltraViolet (all major studios with the exception of Disney) have approved Flash Access as one of the few DRM's that would carry this very high-end premium content.
We launched Flash Access with Windows, MAC and Linux right off the bat. Later on we announced AIR for TV which brings AIR to connected TVs and Blu-Ray players - you can think of AIR as Flash for apps, ie outside of the browser. At CES earlier this year, Samsung announced their intention to support AIR for TV. And if you look at one of my earlier blog posts I also said we're extending Flash Access to mobile devices. We allow one solution to target all sorts of devices.
Kanji: And what conversations have been going on internally at Adobe about HTML5? Is it a competitor tech and if so, how do you compete with it?
Pestoni: Well I think we see HTML5 and Flash as being complementary. Flash Player lives inside an HTML web page so they already work side-by-side. And over time, some things you could only do with Flash have become possible with HTML. There's some great functionality with HTML5 but one thing it hasn't fully worked out yet is video codecs and content protection. So on that front, with Flash Player, regardless of the browser, content is encoded to the H264 standard which is the most prevalent standard out there, you get content protection in the form of Flash Access. So we still think that if you're trying to create a high-quality content solution you'd use Flash.
Kanji: So HTML5 is not a "Flash-killer"?
Pestoni: I don't see it that way. We've always had this complementary relationship with HTML: we have great tools for HTML designers. It certainly gets more coverage if you present it as a "death-match" between HTML and Adobe but I don't see it that way.
Kanji: I needed to ask the question! And that leads on to the next question: why isn't Apple using Flash?
Pestoni: And I would recommend that you call Cupertino (Apple's head office) and ask them that.
Kanji: Ok! Let me phrase the question in a different way. How disappointed was Adobe that Flash wasn't incorporated into Apple's products?
Pestoni: Again, our focus has been on creating a great platform for content providers. We focus very much on mobile devices - we have a great working version of Flash and AIR on Android devices. I think we've clearly demonstrated there's a great user-experience around Flash and AIR but I think each company has to make their own best call about what features and functionality to include in their products and then ultimately the consumer will make the right choice.
Kanji: Well, as you say, the consumer should be the winner because it's good to have competition...
Pestoni: There's a benefit for consumers for sure. If you look at tablets and OS's that are coming out; they get an advantage by offering the full web rather than just apps.
Kanji: And that's a big difference isn't it? You're backing the full web over the alternative, enclosed universe of apps from an app store?
Pestoni: Well the thing is you can actually create an AIR app for example and say that you want it to run on Android and iOS. So, really for developers who want to target different platforms this is a great option. We've always served both designers and developers and we understand how they work together. We have tools targeted at both groups and in most projects you're usually going to have some mix of the two.
Kanji: Moving on, how have you noticed video-on-demand developing over the past few years?
Pestoni: Well, I've been working in media for over a decade and it's been a great ride. There's been so much change and progress. I still remember when streaming video meant a postage-stamp sized little window, with pixelated pictures, on your computer. And now you have HD, super-high frame rates on a mobile device. The technology has evolved tremendously. And so has the business side of things. You now have companies like HULU and VUDU and Netflix who really focus almost exclusively on VOD. And it's extending elsewhere to companies who weren't previously targeting the online space. So you have people like HBO with HBO GO. For consumers that's a great boon because they can access the content they want when they want it. There's also an emerging trend which is catching on which is the TV experience overall. We're used to watching television on TV but now there's more engagement with content so we're using more devices to augment the viewing experience. The other thing is that as bandwidth gets broader, TV is going to be more and more delivered over-the-top or via the internet.
Kanji: And have you seen any innovative monetisation models in the States?
Pestoni: My sense is that there's going to be as much business model innovation as technical innovation in the online video space. Advertising has always been a great model for monetizing content, eg in free-to-air television, and with online delivery you get the benefit of detailed metrics, the opportunity for ad personalization.
In addition, subscription is still a very good model. You've seen the growth of Netflix in the US and they're now beginning to expand internationally. And traditional Pay TV providers are also expending their offerings with Internet distribution.
Then there's always going to be some content which is made available in a more transactional model. So, theatrical content makes the most money in the early days and weeks after release. We're starting to see studios experiment with like making early release window content available even sooner after the movie is in theatres.
In my mind, there's always going to be a combination of transactional, subscription and advertising. The studios have always been very adept at changing the model over the lifecycle of a content product. You pay for it at the movies, then again for DVD and then eventually you watch it on TV and there, it's ad-supported. We're going to see changes in the business model over time.
Kanji: And how will Adobe evolve?
Pestoni: For us, we want to continue helping developers and designers create fantastic content and solving the problem of device fragmentation. It costs a lot of money to be able to target different devices and this is where products like Flash and AIR can provide cost-effective solutions.
And we will continue to offer tools, servers and services to meet the needs of content programmers and distributors who want to target consumers on all these devices.