Azure raises the stakes!

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Check it out! Microsoft today released the public previews of Live Streaming and Content Protection offerings as part of its Azure Media Services suite. At the same time, the company announced Azure Media Services Indexer is now generally available.

Microsoft raises the stakes with those using Amazon S3 and other cloud based streaming solutions by offering that they are the only provider that offers live streaming as part of an end-to-end workflow. Live Streaming enables its customers to stream their own HD quality live events, and create live linear and live to video on demand (VOD) experiences. The use 2014 Olympics and FIFA World Cup as their benchmarks of quality and ability to deliver a robust stream globally. The company points out this is the same solution that delivered the 2014 Olympic Winter Games and the 2014 FIFA World Cup to tens of millions of viewers globally. In other words, Azure customers are not getting some flaky new test service, but a tried and tested technology that has already met the scalability, uptime, and reliability requirements of massive live events.

Next up, Azure Media is getting a new Content Protection offering to protect customers’ premium video content. It features both static and dynamic encryption with first party PlayReady license delivery and an AES 128-bit key delivery service, as well as a scalable License Key Delivery service that is hosted in the cloud.

Faster encoding speeds are also now available via Basic, Standard, and Premium Encoding Reserved Units. These tiered Reserved Units let you tailor the encoding capability you pay for to the needs of your specific workflows. Microsoft is promising more cost-effective billing designed for premium media encoding and is billed based on output GBs. Finally, the Azure Media Indexer has hit general availability. The content extraction service can be used to enhance the “searchability” of audio and video files. It can quickly index your media library so you can later search by keywords, phrases, or clips, as well as create transcripts of audio files or the audio track of a video file.It’s also worth noting that Microsoft has struck new partnerships with Telestream’s Wirecast, NewTek’s TriCaster, Cires21 and the widely-used JW Player. You can check these in the Azure Management Portal.

How-To: High Quality H.264 Files from Streaming Media Magazine

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Reprint of article form Jan Ozer from streamingmedia.com, January 14, 2014

H.264 is the only compression technology that plays on all computers, mobile devices, and OTT players. This makes producing high-quality H.264 files compatible with your target playback devices an essential skill. Helping you acquire and/ or polish this skill is the focus of this article.

We’ll start with the compatibility element, since if the file won’t play on your target devices, it really doesn’t matter how good the quality is. Then we’ll tackle the resolution, frame rate, and data rate of your encoded file, since if you get these wrong, fussing with the H.264 encoding parameters of your file also won’t matter. Then we’ll cover choosing the right encoding tool and H.264 codec and how to quickly tune x264 encoding parameters for an optimal quality file.

Ensuring Compatibility
The most fundamental H.264-related encoding parameters are profiles and levels. Briefly, the profile controls which encoding algorithms and techniques are used when producing the encoded file. The Baseline profile produces a file that can be played back on devices with minimal CPU and memory, while the High profile uses the most advanced techniques and requires a more powerful playback platform. Most encoding tools provide a simple control for choosing the profile, such as that shown in Figure 1 (from Telestream Episode).

Figure-1

Profiles were established in the H.264 standard to allow device manufacturers to support H.264 playback with an inexpensive, power-efficient configuration, such as that used in the original video-capable iPods, which could only play H.264 video encoded using the Baseline profile. At the other end of the spectrum, computers manufactured in the last 5 or 6 years and all OTT devices can play video encoded using the High profile.

To enable even more precise targeting of playback capabilities, levels set maximums for parameters such as resolution and data rate within each profile. This is shown in Table 1, which shows the profiles and levels supported by all video-capable Apple devices. In the first column, you can see that the original iPod, through version 5g, could only play video encoded using the Baseline profile to Level 1.3, which meant 320×240 resolution at 30 fps at a maximum data rate of 768 kbps. In contrast, as with computers and OTT devices, the newest Apple devices can play pretty much any file you would care to throw at it.

Table-1

Table 1. Playback capabilities of Apple devices

Looking at the second column from the left, if you want your video to play on version 4 or lower iPhones, you need to produce these streams using the Baseline profile at a maximum configuration of 640x480x30fps at 2.5Mbps. In fact, in Technical Note TN2224, Apple’s seminal reference on producing HTTP Live Streaming (HLS) adaptive files for iDevice delivery, Apple recommends encoding all 640×360 streams and smaller using the Baseline profile, with higher resolution files encoded using the Main and High profiles. Note that as part of the HLS specification, devices check the stream configuration before retrieving a file, so they won’t attempt to retrieve a file that they can’t play.

Unfortunately, the breadth of Android manufacturers makes consolidating playback capabilities into a table like Table 1 nearly impossible. Instead, Google guarantees that each Android device will play a 480x360x30fps file encoded at 500Kbps without the H.264 playback hardware acceleration that most devices supply. In other words, while most recent Android devices are capable of playing back files encoded using the Main and High profiles, Google can’t guarantee this. In fact, Google’s Supported Media Formats document states that 1280x720x 30fps video encoded at 2Mbps using the Baseline profile will not play on all Android devices.

For this reason, when producing a single file for Android delivery, most sources recommend encoding at the maximum supported configuration (480x360x30 fps @ 500Kbps, Baseline Profile). Since Android versions 3.0 and above support HLS playback, you can use the Apple schema presented in TN2224 to efficiently deliver to those Android devices as well. That is, so long as you encode at least one stream at 480x360x30fps at 500Kbps using the Baseline profile, you’ll have one stream for Android devices to play, and using the HLS protocols, the Android device will be able to retrieve any higher-quality file that it can play.

The bottom line? If producing a single file for mobile playback, you should use the Baseline profile to ensure universal playback. If producing an adaptive group of files for mobile playback, you should encode the lower-resolution files using the Baseline profile, and the recommendations Apple provides in TN2224 are a great place to start.

This raises a larger question: If you do produce files using the Baseline profile for mobile playback, should you also create files using High profile exclusively for computer and OTT playback to provide the highest possible quality? In my experience, the qualitative difference between files encoded using the High and Baseline profile is often less than you might think. For this reason, you should compare the quality of files encoded using the High and Baseline profiles to make sure the additional encoding cycles are worth the effort.

Configuring Your Files

Once you’ve ensured compatibility, it’s time to shift your focus to quality. The most critical element here is the configuration of your video file(s); specifically the resolution, frame rate, and data rate. Get these wrong and your file will look awful, even if all other encoding options are perfect.

By way of background, as with all streaming-video codecs, H.264 is a lossy codec, which means the more you compress the video file, the more quality you lose. How do you ensure that you don’t over-compress your video? By monitoring a metric called bits per pixel.

Briefly, bits per pixel is the amount of data applied to each pixel in the file. The formula is the per-second data rate, divided by the number of pixels per second, which you compute by multiplying the width times the resolution times the frame rate (data rate/width x height x frame rate). For example, suppose you encoded a 640x360x30 fps file at 800Kbps. The bits per pixel would be 0.116, calculated by dividing 800,000/(640x360x360), or 800,000/6,912,000. Alternately, you could just load the file into MediaInfo, and let the free, cross-platform tool compute the bits per pixel for you (Figure 2), as well as provide a bunch of other meaningful encoding details.

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Figure 2. Choosing the profile in Telestream Episode

At 640x360x30 fps, most producers use a data rate of around 700Kbps to 1Mbps, which delivers a bits-per-pixel value of between 0.1 and 0.15. At the upper end of the scale, ESPN encodes its high-motion sports content at 1.4Mbps, or 0.203 bits per pixel. If your video is blocky, pixelated, and full of artifacts, and you’re encoding at a bits-per-pixel value of 0.1 or below, raise your data rate to bring quality into line. If your bits-per-pixel value exceeds 0.2, there’s a good chance you could produce visually similar results at a much lower data rate, saving bandwidth costs and enabling delivery to mobile devices. Try encoding at a lower data rate and see.

Because codecs are more efficient at higher resolutions, the bits-per-pixel value necessary to maintain equivalent quality drops as frame sizes increase. For example, in their 720p stream, ESPN encodes at 2.8Mbps, or 0.102 bits per pixel, about half the bits-per-pixel value used for 640×360 files. The mathematical representation of this increased efficiency is quantified in the Power of .75 rule, which involves fractional exponents and is beyond my ability to verbally explain. You can read more on this.

For the purposes of this article, just understand that as resolutions increase, the bits-per-pixel value required to deliver equivalent quality drops. As a guide, consider the data in Table 2, from my book Producing Streaming Video for Multiple Screen Delivery, which shows data rates at the resolutions and bits-per-pixel values shown, all at 29.97 fps. The red squares suggest the appropriate data rate for each resolution, which as you can see, drops in bits-per-pixel value as resolutions increase. Again, if your data rates are much lower than those shown and the quality doesn’t cut it, boost the data rate until quality is sufficient. If your data rates are much higher, experiment with lower data rates to see if you can produce a lower-data rate stream that looks the same but is more efficient and cost-effective.

Table-2

Table 2. Recommended data rates at various video configurations

Choose the Right Encoding Tool
Once you get the profile and configuration right, it’s time to start honing in on H.264-specific parameters. The sheer number of streaming professionals using Final Cut Pro X (FCPX) guarantees that quite a few producers are encoding with FCPX’s companion product, Apple’s Compressor. Though Compressor itself is capable, the stock Apple H.264 codec included in the product is very subpar.

By way of background, H.264 is a standard, so unlike proprietary codecs such as On2’s VP6 or Microsoft’s Windows Media Video codecs, multiple parties can create their own codecs. As you’ll see, MainConcept, a German subsidiary of Rovi Corp. (formerly Macrovision), has produced an H.264 codec used in many premium encoding tools, while the open-source x264 codec is also widely supported. Apple created one of the first H.264 codecs, which was competitive in its day. However, since then, other developers have optimized their H.264 codecs, while Apple, presumably focusing on more profitable segments, let its codec languish, and its quality is now uncompetitive.

Fortunately, Compressor can access QuickTime plug-ins such as the x264Encoder plug-in that you can download at MyCometG3. Note that the developer of the site, Takashi Mochizuki, discontinued development on the plug-in at the end of 2011, so the code is frozen as of that date. That said, while there will continue to be quality and performance advances, the x264 codec at that time was highly optimized. As you can see in Figure 3, it delivers significantly better quality than the Apple codec.

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Figure 3. Compressor’s native Apple codec is subpar at aggressive encoding parameters

For the record, unless otherwise stated, all comparison frames in this article were produced using my standard 720p test file, with the 29.97 fps video compressed to 800Kbps using the highest quality-related settings supported by each encoding tools, and consistent key frame, B-frame, reference frame, and similar parameters. These parameters are aggressive; by comparison, sites such as YouTube and ESPN produce their 720p, 29.97 fps video at 2.5Mbps or higher.

To be fair, if you’re producing your 720p files at 2.5Mbps or higher, you’d likely see very little difference between the Apple and x264 codecs. However, if you’re attempting to achieve the highest possible quality at the lowest possible data rate, the x264Encoder will perform much better. In particular, mobile encodes, which require a highly optimized stream to deliver the largest resolution at the lowest possible data rate, can significantly benefit from the x264 plugin. For those unfamiliar with the plug-in, note that OnlineVideo.net published an extensive tutorial on how to install and use the X264Encoder in an article titled, “Final Cut Pro X Tutorial: How to Get Better Encoding Results.”

Use the Best H.264 Codec

Many encoding tools, such as Sorenson Squeeze in Figure 4, offer multiple H.264 codecs, including the MainConcept codec, x264 and multiple hardware-accelerated codecs such as the MainConcept CUDA codec or Intel Quick Sync Video (QSV) H.264 codecs. Which are best here?

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Figure 4. Which is the best option here?

First, you should never use the MPEG-4 codec unless you’re attempting to create files specifically for older mobile phones and similar devices. For general-purpose use, H.264 always delivers higher quality at the same or lower data rates.

As between the MainConcept and x264, Moscow State University issues an annual H.264 comparison that is both extensive and highly regarded. Over the last few years, x264 has proved the highest-quality option, with MainConcept in second, typically about 20% behind x264. To explain, the researchers reported that for their test clips, using the x264 codec, you could produce a file at a 20% lower data rate than MainConcept with equivalent quality.

Interestingly, Moscow State University relies solely on mathematical quality comparisons, specifically the Peak Signal-to-Noise Ratio (PSNR) and Structural Similarity Index (SSIM) metrics. Uniquely, the x264 codec offers tuning options (more later) that produce streams optimized for these tests, which apparently Moscow State University used when producing its x264 files. This potential advantage led the researchers to include this statement in their overall conclusion: “The leader in this comparison is x264 — its quality difference (according to the SSIM metric) could be explained by the special encoding option (‘tune-SSIM’).”

That red herring aside, my own tests, which are entirely based upon subjective frame and playback comparisons, indicate that x264 produces higher quality streams than MainConcept, though the advantage seems smaller than the Moscow State University report might imply. Specifically, in most of the seven sequences in my standard test clip, the quality of the two streams was very similar. Where there was a difference, however, x264 was always better, as shown in Figure 5, where the x264 frame clearly retains more detail in the circled area.

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Figure 5. x264 delivered slightly higher quality than MainConcept.

However, the difference isn’t nearly as dramatic as the x264-Apple differential shown in Figure 1. For this reason, while I use x264 when available in an encoding tool, I wouldn’t switch encoding tools because only MainConcept, and not x264, was available.

In comparison, as shown in Figure 6, I never use hardware-accelerated H.264 codecs such as the Intel and MainConcept CUDA codecs, since they are clearly inferior to software-only encodes. As a confirmation of my subjective findings, Moscow State University rated the Intel codec 82% behind x264, with the MainConcept CUDA 170% behind.

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Figure 6. Hardware accelerated codecs encode much faster but offer noticeably less quality.

Briefly, these hardware-accelerated codecs leverage the dedicated encoding cores on Intel CPUs (QSV) or the general processing power of NVIDIA GPUs (CUDA), and the design emphasis was on speed, not quality. If you need fast draft encodes, these codecs might provide some value. Otherwise, you should eschew them in favor of totally software-based H.264 codecs such as the x264 or MainConcept codecs.

What about other products that use proprietary H.264 codecs? For the most part, you’ll find these on some higher-end products such as the hardware and cloud encoders offered by Elemental Technologies. In my experience, vendors that use proprietary H.264 encoders have invested significant resources to come close to or match x264’s quality. For this reason, codec quality is seldom a significant differentiator when comparing these high-end tools.

Optimize Your x264 Encodes
One popular feature of the x264 codec is a plethora of configuration options, though with options such as “Quantizer curve compression factor” and “Use mixed refs per 8×8 partitions,” it’s likely that very few compressionists in the field can tie these options to any desired encoding outcome. Fortunately, most encoding tools that use the x264 codec let you select both a preset and the tuning mechanisms, with the typical options shown in Figure 7, a screen from the x264Encoder discussed previously. Briefly, presets, which were created by the x264 development team, adjust the individual x264 encoding parameters in ways that trade off quality versus encoding time. When it comes to choosing a preset, the obvious questions ask how much quality and how much encoding time.

Figure-7

Figure 7. x264 Preset and Tuning from the x264Encoder

Let’s address encoding time first. Table 3 shows the encoding times with Sorenson Squeeze when producing my 92-second test file to the data rates shown using the presets shown. I performed these tests on an HP Z820 with two 2.7 Ghz Intel Xeon E5-2697 v2 CPUs, each with 12 cores (24 with HTT enabled). So this is a very fast computer, and the x264 codec is very highly optimized for multiple core computers, using nearly 100% of available CPUs on all encodes. If you’re using a slower computer, times will obviously increase, as will the differences between the intervals.

Table-3

Table 3. Encoding times using the x264 profiles at these target data rates

From a strict performance perspective, there is little reason to choose a preset slower than Medium, which is generally the default setting, since the performance boosts at the faster settings aren’t that dramatic. How does the quality compare?

Well, in my comparisons, the only preset that showed obvious artifacts was the Ultra Fast preset, which showed blockiness at both data rates (Figure 8). At the other end of the spectrum, the differences between even the Placebo and Medium settings was very minor, and often the frames looked visually identical. In fact, there’s a surprising lack of differential between all encodes ranging from Super Fast to Placebo.

Figure-8

Figure 8. Files encoded using the various x264 presets

If you run a quality-focused shop and aren’t limited by throughput on your encoding stations, you could use the Very slow preset to potentially increase quality, while only doubling encoding time. In contrast, the Placebo setting would have a much more dramatic impact on encoding time, and it’s unlikely to produce better quality than the Very Slow option.

At the other end of the spectrum, if you’re throughput-limited, you could try encoding using the Super Fast option and test to see if the files appear degraded compared to those encoded using the Medium option. However, don’t expect the time savings to be significant. If you are throughput-limited, it may be time to consider shopping for a new encoding station.

What about x264 tuning? For general-purpose footage, some pundits recommend using the Film option, though in my comparison tests using my standard test files, I’ve seen no difference. Otherwise, if you’re encoding specialized footage, try the specific tuning option, such as the Animation setting for animated footage, Touhou for this Japanese computer game, Still Image for slideshows, and Grain for footage with lots of graininess.

What if your encoding tool doesn’t use the x264 codec? Unfortunately, the codecs and configurations used by these tools vary so much that any kind of specific advice is impossible. Fortunately, most encoding tools include presets designed to deliver the optimal blend of performance and quality. When a vendor offers presets, I would choose the preset closest to my target configuration, make sure the Profile is appropriate, and adjust the resolution and data rate to my target settings.

This article appears in January/February 2014 issue of Streaming Media magazine as “Time for a Tuneup.”

Danny Ek of Spotify Changes The Music Industry

Daniel Ek

Danny Ek is an upstart Swede who has changed the music industry by knocking on doors in New York and L.A. His big proposal was for the intellectual property to be put up for rent rather than sale. His online service, Spotify, rules the online music streaming market. Below is an article form UK’s The Guardian about his incredible journey and where it has come so far. Don’t miss it because it is a model for how fast things change simply by thinking differently and then committing to that vision.

Originally published at the guardian.com, Saturday, November 9, 2013 by Dorian Lynskey

On one wall of Daniel Ek’s sparsely furnished office in the Stockholm headquarters of Spotify, there is a quotation from George Bernard Shaw: “The reasonable man adapts himself to the world. The unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.”

Ek, 30, doesn’t immediately strike you as the unreasonable type. His face is placid, his voice mild with a transatlantic accent, his body language passive. He wears a rumpled red Ralph Lauren polo shirt, jeans and white trainers. His scalp and chin have equal amounts of stubble, which makes his head look reversible.

“I think Daniel Ek is unbelievable but I don’t think you can say he’s a charming guy,” says Per Sundin, chairman and CEO of Universal Music Sweden. “He comes across as non-threatening in a business with a lot of big personalities,” says Gustav Söderström, Spotify’s chief product officer.

Seven years ago, Ek began approaching record labels with a bold proposition: to make their valuable content available to rent rather than buy, and for free. Most were understandably wary. This new product looked as if it might be the killer of the music industry rather than, as its quietly purposeful creator claimed, its saviour.

Ek won that first battle for hearts and minds. Although many rival services are available, Spotify has become synonymous with streaming, the same way Google is with searching. Last month, on the fifth anniversary of its launch, it made more than 20million songs available to 24 million users in 32 territories. Swedish newspaper Dagens Industrirecently valued the company at $5.2bn. Inevitably, it has made some impassioned enemies. Radiohead’s Thom Yorke recently said: “I feel like as musicians we need to fight the Spotify thing,” and called the industry’s support for the company ”the last desperate fart of a dying corpse.

But it has also made Ek many friends. He fraternises with entrepreneurs, rock stars and other interesting, powerful folk. His next appointment after me is with dubstep star Skrillex. “I get to learn from some of the most inspiring people in the world, whether it’s the Mark Zuckerbergs and Jeff Bezoses or famous brain surgeons, because I get invited to those things,” Ek says evenly. “And on top of that I get to hang out with artists I’ve admired since I was a kid. That’s pretty fun.”

Spotify’s head office occupies the top four floors of a building in an upmarket district of Stockholm and has the typical accoutrements of a hip young tech company. There are graffitied murals, whiteboards covered in Post-it notes, fridges stocked with complimentary soft drinks and a staircase lined with informal employee snapshots. Meeting rooms are named after songs: Paranoid, Poker Face, Pretty Vacant. There are areas dedicated to pool, darts and table tennis. Ek still smarts at the memory of his 21-1 table-tennis defeat by a visiting Justin Bieber. “I’m the worst loser ever so I don’t even try unless I know I can win,” he says.

Spotify also has distinctly Swedish features, such as an unusually flat, democratic management structure and an attitude best described aslagom. “Lagom means not too little but not too much – just enough,” explains Ian Robbins, Spotify’s US-born product owner of artist products. “It comes up a lot. Our former font was called Lagom. It’s very Swedish and it’s pervasive.”

There is, however, a more practical reason why Spotify was a revolution that could only have happened in Sweden, and the seeds were sown 15 years ago.

In the late 1990s, the Swedish government decided to build a society of digital natives. It treated high-speed broadband as an essential public utility and funded schemes to enable every citizen to buy a computer. Unfortunately for the music industry, this digital evangelism coincided with the launch of the American file-sharing site Napster. Young Swedes could now access any music they liked, for free, faster than anyone else, and they did so with gusto. Sundin, a shaven-headed man with a blunt, sardonic manner, tells me that he began to worry when neighbours mentioned that their teenagers had told them not to bother buying music anymore.

With the arrival of Sweden’s own Pirate Bay in 2003, piracy became endemic and the industry contracted at sickening speed. In 1999 worldwide revenue reached an all-time high of $27bn; by 2008 it had almost halved, despite the industry’s various legal and technological attempts to fight back. Sweden had the worst piracy in the western world. Sundin estimates that at Universal and, before that, Sony BMG, he personally laid off 200 staff. In 2006, during a Swedish election debate, both leading candidates for prime minister said that they wouldn’t criminalise a generation for downloading music, effectively endorsing piracy.

After the debate, Sundin’s mother phoned to advise him to find another job. “It was already going down and then they said that,” he remembers with a grimace. “It was terrible. All the newspapers were laughing at us.” So when Ek came knocking, Sweden was the ideal petri dish for a radical experiment.

Sundin compares the industry to an alcoholic who has to reach rock bottom before he admits he has a drinking problem. He was so impressed by Spotify’s demo version that he convinced his bosses to back it: together with other large labels and the Merlin consortium of key independents, Universal owns around 20% equity in Spotify. “I said to my team, ‘This is Jesus coming to town! If this fucks up we’re going to be dead so let’s go all in.’”

“The music industry was in the shitter,” says Ek. “What did they have to lose? On top of that, I literally slept outside their offices, coming in week after week, hammering them down argument by argument.”

Spotify went live (by invitation only) in Scandinavia, the UK, France and Spain in October 2008. A few months later, Swedish prosecutors backed by the international music industry successfully took Pirate Bay to court, and the government finally introduced EU anti-piracy measures. “It was the perfect storm,” says Sundin. “It wasn’t just that it was now illegal. People discovered Spotify and realised it was actually better than piracy.”

To Ek, the music industry’s nosedive was a problem to be solved. “There was this paradox,” he says. “People were listening to more music than ever in history and yet the music industry was doing worse and worse. So the demand for content was there but it was a different business model.”

Spotify in numbersSpotify in numbers. Graphic: Pete Guest

Ek’s theory was that people were willing to do the right thing but only if it was just as rewarding, and much less hassle, than doing the wrong thing. He says that Spotify subscribers don’t pay for content – they can get that for free through piracy – they pay for convenience.

Owen Smith, 27, a Brit who works on Spotify’s platform strategy, understands that transition first-hand. At university he filled a hard drive with pirated mp3s. “I’m of the Napster generation,” he says, a little bashfully. “It was all there and everyone was doing it and it was almost too good to be true.”

After signing up to Spotify in 2008, his behaviour changed. “I didn’t think, ‘This is the morally better choice’. It was just easier. Over time the hard drive became disconnected. It’s funny when it has happened to you and you didn’t even realise it.”

Sundin has the bullish optimism of someone who has survived a near-death experience. In Sweden, total industry revenues are now approaching 2003 levels; Universal is almost back to its 1999 peak; piracy has plummeted.

“Sweden has gone from bad boy to poster boy in five years,” he says with a triumphant grin. “Everyone is looking at what happens in Sweden.”

Daniel Ek has straddled the worlds of music and tech since his childhood in Stockholm’s down-at-heel Rågsved district. His maternal grandparents were both musicians and he writes and plays music himself: a mint-green electric guitar hangs on his office wall. He is also a computer prodigy who was earning several thousand pounds a month from designing and hosting websites while he was still at school.

After dropping out of an engineering course at the prestigious Royal Institute of Technology, he became a hotshot programmer for internetmarketing company Tradedoubler, treating himself to a red Ferrari and a club-hopping lifestyle, but he was unfulfilled and depressed.

He sold the car, swapped his city-centre flat for a cabin near his parents, concentrated on music and meditation, and began hanging out with his former Tradedoubler employer Martin Lorentzon, who was equally disillusioned. In 2005, the two decided to collaborate on a new project that they genuinely cared about.

The company name originated during a last-minute brainstorming session when Lorentzon misheard one of Ek’s suggestions (Ek forgets what) and registered the domain name Spotify, now retroactively explained as a portmanteau of “spot” and “identify”.

When Ek wasn’t overseeing a handful of engineers in a converted three-room flat above a coffee shop, he was out trying to secure global licences from record labels.

After a wave of rejections he narrowed his focus to Europe, which still took a nerve-racking two years with no income. “When we said we wanted to give it away for free and that would help the industry there was a credibility gap that took two years to overcome,” admits Jonathan Forster, Spotify’s European general manager and one of Ek’s first dozen employees.

Minds only began to change when Ek loaded a demo with pirated tracks so that label executives could try it for themselves. Söderström, 37, compares Spotify to Skype: it wasn’t a brand new idea but it was faster, easier and more social than the rest.

The basic user experience remains unchanged. You can search for any song in the catalogue, on an interface similar to the iTunes store, and play it as quickly as if it were on your own desktop. Ek was obsessed with shaving milliseconds off the response time. The human brain perceives “instant” as anything less than 250 milliseconds; Spotify plays songs within 285. Songs can then be shared via playlists, over 1billion of which have been created so far.

You either listen for free, if you don’t mind intrusive adverts and a 10-hour monthly cap, or pay $4.99 a month (“unlimited”) for uninterrupted listening, or $9.99 (“premium”) to listen on a mobile device. The 2009 introduction of the mobile service, including an offline feature, was the turning point in terms of incentivising users to pay. Between 20-25% of Spotify users (currently six million people) upgrade to a subscription. “A lot of people said it was really stupid to start charging when everyone else was free, and we weren’t as sure about it as we like to say we were,” says Söderström. “It was a big risk.”

Spotify’s product development motto is spelt out in colourful plastic letters on a wall near Ek’s office: “Think it, build it, ship it, tweak it.” Usually, its instincts are correct. Rather than clogging the site with secondary services, for example, it has made the app available to third parties such as the gig-listing service Songkick and journalism sources including Guardian Music. Its current focus is on “discover”, which introduces listeners to music via Spotify Radio, curated playlists and algorithmic recommendations.

Its only significant blunder to date occurred during its alliance with Facebook in September 2011, when it prioritised sharing over privacy. Suddenly existing users found that all their listening was public while new ones couldn’t sign up without a Facebook account. After a fierce backlash, both obligations were dropped. “We look back on that as a ‘duh’ moment,” says Robbins. “How did we not understand that?” He shrugs. “We learn by doing.”

Despite Spotify’s lagom demeanour, its ultimate goal is far from moderate. “I want everyone in the world to be able to listen to anything ever created,” says Söderström. “And I think we’ll get there.”

For that to happen, many artists remain to be convinced. Although former refuseniks Pink Floyd recently came on board, the representatives of acts ranging from the Beatles to Boards of Canada are currently holding back most or all of their catalogue. Some, like the Black Keys and Thom Yorke’s new band Atoms for Peace have been publicly hostile. “New artists get paid fuck all with this model. It’s an equation that just doesn’t work,” Yorke’s bandmate Nigel Godrich recently tweeted.

“The concern is genuine and understandable,” says the unflappable Söderström. “If you put your entire life into creating art, of course you’re going to be careful about it. Fortunately we now have tangible data. We try to inform and be as transparent as possible.”

The key issue is royalty payments. Spotify says that around 70% of its income subscriptions is paid into an industry pool, from which individual copyright holders pay their artists, albeit not very transparently. Artists’ income will only grow as the user base expands. Spotify finally launched in the US in 2011 and eventually aims to cover the entire world. By last February, it had paid out $500m to rights holders to date; by the end of 2013 that figure will have doubled. Of course, that $1bn pie is divided into an awful lot of slices.

Spotify in numbersSpotify in numbers. Graphic: Pete Guest

Mark Williamson, director of Artist Services, says that payments are not calculated on a per-stream basis but insists, “The rates are equitable across labels.” Working back from their royalty statements, several artists have calculated the rate at around 0.4p per stream, so you need over 200 plays to match the 99p paid for one iTunes download. Whether or not that is fair depends on what you’re comparing it to. If you count every stream as a lost sale then it’s disastrous. If, however, you compare it to YouTube (whose rates are secret but reportedly lower) or piracy then it’s not so bad.

“This is not a dollar business anymore; it’s a nickel-and-dime business,” insists Sundin. “If you don’t get played then you’re not popular and you don’t get money. Accept it. Kids like what they like.”

He pulls up a graph on his laptop to show me that one of his artists, the Swedish electronic dance-music producer Avicii, had 3.7 million plays the previous day while U2 receive about 250,000 every day. Traditionally, the average album earned most of its revenue within a couple of months and then dipped as interest waned and retail shelf-space was ceded. On Spotify, theoretically, a song never need stop earning money.

The Scandinavian experience suggests that Spotify is good for the industry’s overall revenues because it benefits heavyweight stars, back catalogue and viral hits. Stephan Markovits, who works in the Swedish electronic dance-music scene, points out that Million Voices, a 2012 single by local DJ Otto Knows, has been streamed more than 28 million times. “People create playlists, they have house parties, they go to work on the bus, so a song will live for longer rather than going up and down quickly,” he says.

However, high-profile sceptics such as the musician David Byrne have argued, it will not help every kind of artist. Consider a cult band who don’t have hits but currently sell enough CDs to survive. If every single one of their fans switched from ownership to streaming, the band would need at least 200 times as many new listeners to make up for the shortfall. The numbers game doesn’t work for them.

The sceptics see Spotify as inimical to new and independent musicians. “We don’t support Spotify at all,” says Lohan Presencer, chief executive of Ministry of Sound, whose roster includes Wretch 32, Example and London Grammar. “From a business perspective it doesn’t make sense for us and our artists.” He believes that as well as paying poor royalties, Spotify cannibalises sales, offers less promotional benefit than YouTube, and “propagates a myth that music is free”. And he is dubious about Spotify’s expansion plans because it still makes a net loss: €58.7m in 2012 despite revenues of €434.7m.

“How sustainable is that business model? Is it going to get 100 million users or is it going to run out of money before that point? Should we, as an industry, be supporting a business that has no real prospect of succeeding? The justification that it is saving the industry from piracy is a bit rich. Their objective is to build a business and then to sell it before they run out of cash.”

Söderström counters that Spotify “could have been profitable several times” but has chosen to invest everything in new staff (currently more than 1,000 worldwide), products and territories. He also says that Ek, while enormously wealthy on paper, has not cashed in by selling Spotify. “Why hasn’t he? Because he actually cares about music. He wants to solve that problem. He would like to see a world where you can listen to music without ripping people off.”

Forster adds: “No matter how many times I say that Daniel’s not interested in the money nobody’s ever going to believe me. But frankly that’s not what motivates him. He likes to build things. If you think about a product that gives you the potential to touch literally everyone in the world, it’s boy’s own stuff. There’s no issue with Daniel thinking big.”

Apparently not. Spotify was born out of a single correct assumption about human behaviour, namely that music fans would embrace, and even pay for, a legal service if it was virtually frictionless. Now the company’s colossal volume of granular data makes assumptions unnecessary.

Before digital music, the industry’s understanding of consumer behaviour ended at the point of sale, but Spotify knows who listens to what, and when and where they do so. Artists can tweak their tour schedules based on regional data or choose singles based on which album tracks are most popular. Spotify already changes how music is heard. It may soon change how it is made.

“I think we’re in the middle of a transition but it hasn’t moved all the way,” says Ek. “Why are we releasing albums the same way as we did 10 years ago? Music is no longer restricted by the format it’s on.

“We make audio records alone when they could be audio-visual-interactive. That’s what I find interesting: What’s the future of the album? That’s something we’ve only begun to touch.”

Microsoft Streams in the Cloud with Azure Media Services

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This Tuesday, Microsoft enetered a new offering in the Live Streaming space with it’s windows Azure Media Services. This cloud-based service can be used to stream from a website, build an on-demand platform or deliver training videos employees. Like other cloud-based platform offerings (i.e. Amazon S3) Windows hopes to make video streaming for the enterprise easy and simple to use. Not all cloud-based server platforms are easy though, so it remains to be seen if that proves true. We at mediastreampro will put it through the paces to see how it compares to the somewhat difficult Amazon S3/EC2 path.  Microsoft’s Scott Guthrie said in a blog post that building a media streaming platform that encodes and streams video to various devices and clients is a complex task, which requires hardware and software that has to be connected, configured and maintained. He offers that Windows Azure Media Services makes it easier by eliminating the need to provision and manage a custom infrastructure. We’ll see how easy it really is. A version is now available for private testing  with a public version coming soon. The user is charged a flat pay rate, starting at $1.99 Gb and discounted for larger volumes. Competition for cloud-based streaming is always good. We can only hoipe that it is as easy to use and reliable as they are promising.  Stay tuned for more info durnig our test drive.

12-12-12 Concert is Stream-tastic!

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Paul-McCartneyOn 12/12/12 there was a fantastic benefit concert in support of the people suffering from the devastation that was Super Storm Sandy. It was an incredible night of music and community for those who love the New York/New Jersey area and want to give back. What was particularly powerful was the quality of the live stream that iHeart put out on the benefit website at 121212concert.org. HD quality images and true concert sound of the Rolling Stones, The Who, Paul McCartney, Alicia Keys, Kanye West, Michael Stipe, Chris Martin, Billy Joel, Diana Krall and the list just keeps going on and on. I was initially watching the concert on ION television but they unfortunately cut it off just before Paul McCartney was to come on the stage. Well, after being flabergasted that WWE wrestling just cut out Sir Paul who opened with Helter Skelter, I was saved by the stream. It was pristine quality with awesome sound. I realized, as I still watch Paul jam it out with Diana Krall, that the future is now. The power of live streaming directly over the internet is here and its crystal clear and sounds great. The days of being the slave to endless promos, commmercials and wrestling are over. Interestingly, it was wrestling that built early television, with Bruno Sanmartino and Ivan Putski on the black and white and then it built cable for uncle Ted and his empire of CNN but now it is signalling the end of what we knew as I watch what is to be.

The freedom that this represents for everyone to communicate, entertain, support each other and decide what we think is important to watch and when we want to watch it will continuously drive the audience to cut the chord. Those in TV land have just missed Dave Grohl and other former members of Nirvana join Paul on stage to rock out live to benefit hundreds of thousands of displaced and effected people in the New York Metro. Meanwhile, wrestling is fake fighting away on its pretaped show with countless fans completely miffed that they missed this. This is the power of streaming in full force and I wonder how many fans of Sir Paul or natives of New York, New Jersey or Connecticut will buy a Roku tomorrow, or an Apple TV? They certainly did not suffer as far as picture and sound go. They did not get baraged with promos or commercials. They did not have to pay for cable subscription fees either. Now, to be fair they do need high-speed internet, but that’s about it. The change that is coming will march forward with nights like this one. As more and more folks flee hundred dollar a month programming fees, the choice becomes one of freedom, not just money. We will not be told what to watch or when to watch it! I am going out and getting my own Roku in the morning.

In closing, I am from New York and New Jersey and I appreciate all the wonderful Brit rock stars who showed up tonight. Also to Brian Williams, Stephen Colbert, Chris Rock, Quentin Tarentino, Jason Sudekis, Katy Holmes, P Diddy, and the many others who also showed up for the benefit of those in need, I give a heartfelt thanks. You are all class acts and NEW YORK/NEW JERSEY/CONNECTICUT LOVES YOU! Now as Sir Paul closes with one of my favorite songs of all time, “Live and Let Die”, amidst incredible pyro and lighting and then personally meeting the first responders who were there, I just want to say I am forever a fan.

Media Streaming Webcast

Presented to the Georgia Production Partnership on October 2, 2012


A Discussion About Live Streaming with

 David Kennerly from Turner Broadcasting

and John Kabashinski of Media Stream Pro

David Kennerly is the Manager of New Media Production & Development 

for Turner Studios Streamlinewhich serves as a production vendor for Turner networks and a variety of other clientele.  Streamline primarily produces live multi-camera webcasts of:

•    Sporting events – like the Ryder Cup for PGA.com last weekend

•    Entertainment events – like the annual red carpet pre-show of the Screen Actors Guild Awards

•    Corporate and Special events – like TEDx Atlanta last week

In addition to live events, Streamline specializes in creative technical solutions to all sorts of production problems at the intersections of traditional and emerging media.

 

John Kabashinski is the owner and Creative Director of Sun Moon Stars and a streaming blogger and consultant with MediaStreamPro.com. As the leader of a multi-platform production company John has created home videos for MTV, redesigned exhibits at Epcot Center for Motorola and has been nominated for three Emmy Awards and received a Froggy Award for best image campaign in the nation from the WB Network. Online, John has developed several member networks including managing the transition to a server-based content management system for the GPP in his role as IT Chairman. In addition to his creative and production credits, John designs and develops media streaming websites and is an accomplished content srategist and online marketer with extensive experience in media streaming, encoding, eCommerce, SEO, PPC, Article Marketing, email marketing, payment gateways and content delivery networks. Some of John’s online properties include: 

 

           MediaStreamPro.com              SpiritualHealthPlan.com        LifeForceExplained.com          

           TraditionTheFilm.com              YourBestFriend.tv                 FindersKeepers.tv

                                                         EatMyYard.tv 

Welcome to Media Stream Pro

MSP-Feature

Welcome to Media Stream Pro. This blog has been created to provide the latest information in the world of media streaming, which includes news, product announcements and reviews, technology developments, how-to demonstartions, best practices, cost saving tips and an opinion or two about the direction of the media streaming universe. The reason for Media Stream Pro was to define an entire section of work that was dynamic and important part of a larger television production and web development business. Eventually, it developed into a passion and principle part of the future of the creative industry.

Media Stream Pro is for beginners and pros alike. Unlike other great resources on streaming, Media Stream Pro also emphasizes the importance of content strategy and eCommerce integration. Media Stream Pro is not just about streaming, but how to make a living while doing it. It is about the freedom that becoming your own broadcaster represents to legions of creative people who yearn to have a voice and find an audience. It’s also about the business of internet broadcasting and how businesses are changing the landscape. It is also abot the social side of streaming and how communication is miving full force into a revolution that is literally changing the world.

Please enjoy Media Stream Pro. Let us know what you are thinking, questions you might have, ideas for blog posts and both criticism and praise. Media Stream Pro is for you and everything you wanted to know about Media Streaming.