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               CloudChannel  –  Behind  the  Front  

Published: 15th August 2011 Context This is a blog article I wrote as CEO of a listed US microcap company. It was part of a communication channel I created called “Behind the Front” which was designed to add context to press releases and other announcements that had, by necessity, to be brief. It has been edited slightly before reformatting, but the sense of the article remains the same. The piece was posted to accompany a press release (http://mwne.ws/1FbNMuW) announcing a new alliance with Origin Digital, a specialist divisionof Accenture. Under the terms of the agreement, CloudChannel would build Origin Digital’s streaming and media management platform, Odaptor, into the core of its product. The product under discussion, CloudChannel, was not brought to market after development funding was withdrawn after my departure from the company. It was a great shame. An alpha version of the product was built and demonstrated to potential customers, who loved it. Accenture has since built some of CloudChannel’s capabilities into its own service offering.

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<warning> This blog is a long one I’m afraid, but it’s a really important addition to the information that sits in the public arena. If you are interested in RTG Ventures, this is worth the read. </warning> Today, we made an announcement about a collaboration that gives us the ability to scale our business quickly. In the shareholders’ letter that we published to kick off the current marketing campaign we devoted a paragraph to the importance of partnerships.

partnership    (ˈpɑːtnəʃɪp)  A  contractual  relationship  between  two  or  more  persons  carrying  on  a  joint  business  venture  with  a  view  to  profit,  each  incurring  liability  for  losses  and  the  right  to  share  in  the  profits.  

World  English  Dictionary   We use that phrase carefully, because in its literal sense partnerships are about shared risk, joint title, shared rewards and shared losses. Most contracts ban use of the work partnership because legally, it implies a lot. But, there are “partnerships” that do not imply any kind of shared legal liability too. According to the letter of the law, they’re not strictly partnerships, they are instead strategic alliances. To me, however, an alliance still maintains the spirit of partnership; close collaboration that sees two companies working alongside each other for the furtherance of their own business models. My preferred relationship is the latter, because my job is to secure the maximum possible return for my shareholders and unless there is a truly compelling need to share spoils and risk sharing losses, I’ll steer our own course any day of the week. So where does that leave the announcement we’ve just made? Well, as this blog is supposed to explain what happens ‘behind the front’ I thought it would be the ideal medium to explore this strategic alliance in more detail so that investors, shareholders, potential customers and other partners (alliances) can see just how significant it is.

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Being  Lean  There’s a lot of talk about being lean at the moment. Lean means achieving the same results with less work (think investment) and Toyota is credited with creating the concept although the ‘lean’ term wasn’t applied to the method until the 1990’s (Wikipedia). Eric Ries is currently creating quite a storm in the blogosphere about his new book The Lean Start Up, which defines the way that many new tech companies are handling their tech development. RTG adopted a lean strategy for its own developments and CloudChannel is the best example of this. While there are seven formal principles associated with lean software development (Lean Software Development: An Agile Toolkit by Mary Poppendieck), I’m not going to explore all of them in this blog or you’ll soon be asleep. But, to explain the significance to us of the Origin Digital and Accenture tie-up, I’ve marked those that are positively affected, then I’ll get into some more detail.

1. Eliminate waste *** 2. Amplify learning 3. Decide as late as possible 4. Deliver as fast as possible *** 5. Empower the team 6. Build integrity in 7. See the whole

Eliminate  Waste  One of the best ways to eliminate waste is to avoid writing code if possible. We’ve built CloudChannel using open source tools, an open source application framework/CMS (in our case Drupal) and integrated existing technology through application programming interfaces (APIs) so that we don’t have to build things from scratch. This has allowed us to build a functioning application in under half the time that a traditional software development house would take to specify the system. The first products to be launched are not the whole system (see deliver as fast as possible), but are enough to get us into the market and trading. Having said that they are notably different from any other solution out there. Here’s why. The companies that most people will compare CloudChannel to are known as OVPs (open video players). Here, we’re talking about the likes of Brightcove, Ooyala, Kit Digital, Wistia and yes, even good old YouTube. OVPs allow anyone with the requisite amount of money to upload video to a web interface and then stream it to their website. The smarter systems also include sophisticated additional options including monetization, live streaming, ad server integration and regional analytics.

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OVPs do have many bells and whistles, but they are about transcoding, delivering and streaming video. CloudChannel does all this but it’s not our core competence so we’ve seamlessly integrated Origin Digital’s video platform, Odaptor, into our system to handle all of that stuff. We’ve eliminated waste by finding the best and most appropriate existing technical solution and building it is as though it’s part of our system. When you log in to CloudChannel and upload your video, it’s actually Odaptor that you’re uploading it to through our interface. Now, we do some pretty clever things with data, your account information and access rights along the way, but it’s the Odaptor platform that takes your video – in any format – and automatically transcodes into all of the optimized formats for the digital devices that are serviced by CloudChannel. When your fan pays for a video, it’s Odaptor that streams it to you through our player. Again, we do some really smart things with data, rights management, accounts management and channel creation along the way. CloudChannel has been specifically created to answer a common set of problems that owners of live music entertainment video face and that’s our core competence. That’s all we’ve had to build, because Odaptor does the rest. If it was that easy to build what we’ve built, of course someone would have done it by now, so I am not belittling the genius of our technical teams in Kiev, more trying to highlight how important the Odaptor platform is in keeping us lean by eliminating waste.

Deliver  as  Fast  as  Possible  Speed to market is nothing new. In the dot com era, first to market was the battle cry of every wannabe start up. But, as many learnt the hard way, first to market isn’t a guarantee and there are many recent examples of how the leaders got burnt. Six Degrees, Friendster, MySpace and others prove that it’s not first to market that counts, but first to scale. Of course, part of the process is to be able to build fast, but it’s being able to react fast too and still having a resilient enough technical infrastructure to be able to handle massive demand very quickly. If your service falls over, you lose the customer.

In  the  era  of  rapid  technology  evolution,  it  is  not  the  biggest  that  survives,  but  the  fastest.  The  sooner  the  end  product  is  delivered  without  considerable  defect,  the  sooner  feedback  can  be  received,  and  incorporated  into  the  next  iteration.  The  shorter  the  iterations,  the  better  the  learning  and  communication  within  the  team.  

Wikipedia  

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Origin Digital has helped us build our core technology very quickly because we haven’t had to cut code to build what they already have, but there’s far more to it than that. Their platform, Odpator, is enormously scalable and, because it handles the heavy lifting of moving media files around and streaming them, it makes CloudChannel extremely scalable without RTG having to invest in capacity before we need it. Furthermore, the world of digital media is very fast moving and if we’d built everything ourselves, we’d need to commit huge resources to R&D to ensure we’re ahead of the curve. Origin Digital does that for us so that we can concentrate on the bits that we do best.

Business  Development  Since we started developing the CloudChannel Suite, we’ve been out in the market talking to record labels, managers, artists and other important people for our future. The reception to our vision has been very positive, but without the full product to demonstrate, it’s been harder than it should have been. That has already changed because we’re so close to launch and we have now demonstrated the real product several times. But, what adds real gravitas to our pitch is explaining what’s going on behind the front-end of the web application. A really important part of what’s happening behind the scenes is having proven technology that is easy to find references on. Odaptor gives us just that and means that we don’t even need to have the conversation about the quality of transcoding, quality of the stream or any of the other technical hurdles that OVPs have to deal with. Having such a quality partner with a client list including some of the best-known brands in the world, means that we can focus our sales pitch on the things that make us different from the OVPs. We are the only company offering such a tailored and comprehensive solution for the music industry. We are the only company that’s offering a software solution rather than a platform solution enabling rights holders to control their own content, worldwide. The importance of being able to show this kind of focus, this kind of understanding and this kind of scalability cannot be overstated. Now that we have an agreement in place, we can really start to motor. We’re very, very excited about the new relationship with Origin Digital and its parent Accenture. This is a milestone in our development that we’ll look back on in years to come as a significant moment in the company’s evolution.