Hey, Five Questions With… fans, meet Howcast CEO Jason Liebman! Liebman, after working at Google with the YouTube, Google Video and Ad Sense teams, co-founded Howcast in 2007. Howcast is now one of the leading providers of how-to videos online, streaming tens of millions of videos every month, and is the #1 mobile app for instructional content. Today, he dishes about the dangers of “viral video” and the lack of standards, as well as Howcast’s journey towards profitability.
1. What’s the one big issue/law/attitude/restriction that you think is holding back the industry?
A lack of uniform standards for video formats, reporting, and analytics are definitely inhibiting faster growth of the online video market, but in particular the growth of online video advertising, which is essential for sustainable growth. For a company like Howcast, which is building both a destination site on which our videos can be viewed, but also a very large and growing distribution network, the lack of uniform standards makes the simple act of pushing our videos out to this network some very heavy lifting.
It’s a bit easier for us than it is for others since we’ve put the time and effort into creating a workflow that incorporates transcoding into multiple formats. By the time our end-to-end content creation platform pushes out a finished video, it’s ready to be released to every member of our distribution network, regardless of their delivery requirements. But for other content creators, this remains a very manual and time-consuming process, adding unnecessary lag time before their video can reach its ultimate audience.
And on top of the delivery challenges — which are more within our control — there remain significant performance-tracking issues. With no standardization, it’s very difficult for us to gather critical insights with respect to video views, abandonment rates, and overall performance across multiple distributors. Some of our partners, like YouTube, offer “Insight” into these various metrics, but many provide very little visibility of any kind into performance.
2. What industry buzzword do you never want to hear again?
It definitely wouldn’t break my heart if I never heard the phrase “viral video” again. By continuing to toss the expression around, those of us who work in this industry are perpetuating a perception — an inaccurate perception — among some advertisers that a video can be created specifically for the purpose of “going viral,” and be viewed by half the planet before lunch. The reality, of course, is that it’s virtually impossible to know when any given clip is going to tap into the zeitgeist and become a cultural phenomenon overnight. When advertisers expect that, and then don’t get it, they can become disillusioned with online video in general.
3. If someone gave you $50 million to invest in a company in this space, which one would it be? (Mentioning your own doesn’t count.)
There are a number of tools that the industry needs — from standardized reporting and better analytics, to a platform for collaborative filmmaking, better video recommendation and discovery engines, and more. But if I can only pick one company to invest in, I’d have to say Facebook. What Facebook is doing with content sharing, especially with the launch of its new media pages, is going to bring the sharing and socialization of content to an entirely new level. And having recently passed the 500 million user mark, Facebook certainly has the reach to be a disruptive force — in a positive way — for content creators, distributors, advertisers, and users.
4. What was the last video (that you weren’t personally involved with) that you liked enough to spread to others?
I was born and raised in Manhattan, where Howcast is also headquartered, so it’s probably not that surprising that I’m a big fan of Pixels (Manhattan Takeover). It’s a great example of just how much filmmaking brilliance and creativity can be captured in just two minutes (especially for any of those folks who still think that short-form video is only about dogs on skateboards).
5. WILD-CARD: In October 2009, Howcast told the New York Times that it anticipated being profitable “next year.” Is the company still on track for that goal? And what have been the major factors affecting revenue growth?
I’m happy to report that Howcast is, indeed, on track to be profitable by the end of this year. We’ve seen very strong growth in 2010 across multiple revenue streams. Those include custom content creation and distribution for clients that range from Fortune 500 companies to other start-ups, video ad sales, both online — on Howcast.com — and increasingly in our mobile apps, and licensing and syndication revenues from our many distribution partnerships. At the same time, with this growth in revenue, we’ve also continued to refine our content creation techniques to help us push costs lower and decrease our burn rate while actually increasing the rate at which we’re expanding our library.
So, yes, we’re on track to meet or surpass our revenue goals, but we are also running ahead of schedule on our goals for total video views, the growth of our distribution footprint, the pace of innovation with respect to our products and features — you name it. In the mobile space, our recently launched iPad app shot to #2 on the chart of most downloaded apps during its first week of release. For sure, hitting our revenue targets is a very gratifying validation of our business model, but the real key to our success is creating great products and services and continuing to create a very high volume of high-quality content.
Overall, we’re ecstatic about what we’ve achieved since we launched Howcast in late 2007, and we’re excited to continue to grow the business even further and faster.
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