Future of commerce, content relies on open standards for Internet distribution

One of the signs of an industry maturing is a move toward open, interoperable technical standards. As the bloom fades on the IPO rose, the non-dominant players start to realize that proprietary intellectual property may not be the road to profitability. The future begins to look like a choice between open standards and a permanent role as a subsidiary of the dominant player.So it was at Streaming Media West last week in Long Beach CA. Speaker after speaker delivered a plea for a move to open technology.Real Networks' Rob Glaser defined the problem as making the Internet the "next great mass medium" for content delivery. He announced the "XMCL initiative" (extensible media commerce language), designed to allow different vendors to connect their pieces in the value chain.Phil Schiller of Apple Quicktime reiterated Apple's support for MPEG. While acknowledging that a company might be able to do it " faster and better and cheaper" on its own, standards are the only way to "make content in one format that will work with all servers and all players."Scott Dinsdale, EVP, Digital Strategy for the Motion Picture Association, urged a collaborative effort to cross industry barriers. What we need, he said, is a technology that is easy and interoperable. "When you look in the rear view mirror it's pretty ugly. Looking ahead people will be motivated by fear and greed, and not just greed, and then they will start to be rational."The response was divided. Some saw the XMCL initiative as "just another camp", and a strategy for RealNetworks' survival against the Windows Media Player behemoth. Most believed the current U.S. administration would do nothing more to stop anti-competitive behaviour by Microsoft, whose plans to bundle WMP with its OS may spell the end for RealNetworks outside the AOL alliance. Others are genuinely behind MPEG as the solution for streaming, downloaded content, and ultimately, media commerce standards.If the Internet media world is to be more than a battleground between Microsoft and AOL, then this group will have to gain numbers rapidly. And we in Canada had better do what we can to see that it does.Why? To put it simply, standards are essential to an open and competitive marketplace, and an open market is essential to our national economic and cultural policy goals.As the Internet struggles to turn itself into a platform for commercially viable content delivery, we risk having one or two entities stand as technology gatekeepers, able to extract a lot more than their fair share of the benefits of any transaction, and to integrate vertically across the entire supply chain from production to consumer.Even the largest Canadian content producers would have difficulty making their businesses work in such an environment; smaller and regional players could only survive as satellites of the majors.And the damage would be more than economic. Our awareness of our own country depends on the ability of small- and medium-sized players to survive as independent content producers in a Canadian marketplace.The challenge is immense. Governments are increasingly reluctant to set technology standards, or to intervene in the market at all. Nor can the Canadian content industry go its own way.Our only option is to put our full support behind the global standards effort. Standards will not guarantee survival, but they offer a chance to compete. Without this underpinning, an open, competitive, and Canadian marketplace in Internet-delivered content will be impossible.David Keeble is an Ottawa-based consultant specializing in business strategy and the implications of new technology.

Future of commerce, content relies on open standards for Internet distribution

Broadcast | June 28, 2001

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