Brightcove Aims at the Mainstream: Talking with CEO Jeremy Allaire

10/15/08Follow @wroush

Tuesday brought two big pieces of news in the Internet video industry: The relaunch of New York-based Joost as a Hulu clone and the official launch of the newest video hosting platform from Cambridge, MA-based Brightcove. The former development was probably of more interest to consumers, who get an increasing portion of their video entertainment via Web-based platforms. But the latter is of more interest to content publishers, who are searching for news ways to lure these avid video consumers to their sites—and keep them there.

Though Brightcove is probably the largest and best-capitalized company supporting on-demand video services for business clients, it competes in an increasingly crowded marketplace. A short list of companies that help clients maintain Web video channels includes thePlatform, FeedRoom, Extend Media, PermissionTV, and Yahoo subsidiary Maven Networks. (The latter three are located right here in the Boston area—see our March 2008 story on the Greater Boston Internet Video Cluster.)

Perhaps that’s one reason the company felt compelled to rebuild its video hosting service from scratch, introducing a range of new features designed to make it easier for companies outside the big-media world to integrate video into their websites. Competition—and the prospect of bringing in new customers who couldn’t previously afford video hosting services—may also have prompted Brightcove to overhaul its pricing structure. At the low end, small- and medium-sized organizations can now tap into the Brightcove’s tools and services for under $10,000 a year.

Jeremy Allaire, CEO of BrightcoveEarlier this month I visited Brightcove’s offices in Kendall Square and got an hour-long overview of the company and its revamped platform from Jeremy Allaire, the founder and CEO. Allaire has a high profile in the technology communities on both coasts. With his brother JJ Allaire, he founded Newton, MA-based Allaire Corporation in 1995; that company built a Web development platform called ColdFusion that was later purchased by Macromedia. At Macromedia, Allaire helped to create the Flash format that is now the dominant video delivery technology underlying YouTube, Brightcove, and many other Web video services. Between Macromedia and Brightcove, Allaire was at Cambridge, MA-based General Catalyst, which became one of Brightcove’s biggest investors.

Allaire talks fast—so while the following interview transcript may seem long, I’ve actually edited it down drastically.

Xconomy: Before we talk about the new product release, can you give me an update on the company and its progress?

Jeremy Allaire: We’ve continued to have really great growth. Our focus for the last few years has been to work with professional media companies. We’ve now grown our footprint to several hundred major brands that use Brightcove for their online video, like Fox, CBS, Showtime, A&E, and the Discovery Channel. We’ve worked with every major national newspaper company, including the New York Times group, the Washington Post, Dow Jones, and a lot of regional news organizations like Boston.com and the San Jose Mercury News. We are also starting to see large companies like GM, DuPont, and Sun and political organizations such as the Obama campaign using our video platform.

We have 160 employees worldwide. Brightcove-powered sites get 135 million unique visitors every month. We’ve raised $91 million to date, so we have one of the largest capital foundations of any Web company in the Boston area. We had 5x growth last year, about 3x this year, and we expect to reach financial independence next year.

X: Explain how the company operates, and where your revenue comes from.

JA: We are a software-as-a-service company. We license use of our software service on an annual basis, and customers pay for the features of the software, and also pay based on how much customer traffic hits our systems. We ingest customer’s content and manage it inside Brightcove, and we wholesale CDN [content distribution network] infrastructure around the world and bundle it into our service.

X: Which CDNs do you work with?

JA: We work with many different networks, including Akamai, Limelight, Level 3, and others. The very large companies we service bring their own content distribution infrastructure, and we essentially push the content out to their existing infrastructure.

X: So what distinguishes a Brightcove from an Akamai? What services do you provide that Akamai couldn’t?

JA: There’s really a distinction between what I would call telecommunications or transit services, which is what Akamai and Limelight provide, and what we provide, which is a suite of business applications that can be used to operate an online video business—everything from production tools to publishing and content management tools to advertising systems and video analytics. But we integrate content distribution services into our offerings because the vast majority of out customers don’t really want to think about that.

X: Not to belabor the point, but Akamai, which is just down the street from you guys, is promoting a lot of services around broadband video delivery. Are they a competitor? Or might some type of Akamai-meets-Brightcove alliance be conceivable?

JA: Anything is possible. But major users of content distribution services often want to decouple their business applications from their telecom services. I’m certainly aware of Akamai trying to add different things to what they do, and it’s certainly something we keep an eye on, but [competition with Akamai] is not something we’re seeing in the customer segment we’re serving with a product like this.

X: So what prompted you to build this new platform?

JA: When we came out with the beta of our first platform in 2005, online video was an experiment that a few media companies were trying, but generally it was completely new. Over the next three years, we’ve seen online video, as a business within the media industry, become pervasive. Virtually every media business has a video component to their online strategy. So a lot of what we’ve focused on in the last year as we’ve worked on Brightcove 3 is … Next Page »

Wade Roush is Xconomy's chief correspondent and editor of Xconomy San Francisco. You can subscribe to his Google Group or e-mail him at wroush@xconomy.com. Follow @wroush

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