iBEAM's Streaming Strategy - Company Business and Marketing

It's estimated that the average bit of Internet content traverses through 17 to 20 routers before it reaches its destination. With the danger of packet loss increasing with each handoff, it's no wonder videostreaming is tenuous.

But iBEAM Broadcasting Corp. aims to change all that by leapfrogging much of the Internet backbone and deliver videostreaming content, via satellite, to local servers owned by ISP, DSL providers or cable operators.

To date, iBEAM's received a frosty reception from cable operators. "Not invented here is an issue," acknowledges Peter Desnoes, CEO-iBEAM, about his initial affilation talks with cable operators. But he remains hopeful that recent conversations with unnamed cable high-speed access providers will prove fruitful. "I believe we will be able to make the case that there are great benefits to working together."

iBEAM has signed 40 ISPs. It expects to install 30 local server sites a month in 2000. iBEAM's network can handle 300,000 simultaneous video transmissions. That number will rise to 500,000 by mid-year and one million streams by year's-end, Desnoes says.

Content providers, such as Bloomberg TV, snap.com, Entertaindom and others, use T1 lines, satellite hookups or DSL lines to transfer content to iBEAM's satellite uplink facility. Content is beamed from two Williams Communications transponders on a Hughes Network satellite to local iBEAM-owned MaxCaster servers. From there, consumers can stream content to their PCs through their ISP. iBEAM is building regional data centers, in essence creating a mini tree-and-branch cable system to handle local peak load times and create redundancy in its transmission system.

iBEAM charges ISPs about $15,000 per point of presence and $495 a month to maintain the service.

ISPs, such as Covad Communications, NorthPoint Communic-ations, Rhythms Netconnections and High Speed Access Corp., have contracted with iBEAM.

iBEAM, which recently filed to go public, also has an impressive investor list: Liberty Media, Intel, Sony and Covad among others.

In 2000, iBEAM plans to concentrate on adding content partners, signing affiliation agreements in the U.S. and worldwide, and extending the business modal to include locally-inserted streaming ads, Desnoes says.

Wireless also will play a role, spurred by Sony's investment. Concerts and songs can be downloaded, played and transferred to a number of portable CE devices, Desnoes said.

"We don't see ourselves limited to just the computer," he said. "People will use iBEAM downloads in a variety of CE devices. Ultimately there will be linkage through wireless devices."

"We're building a platform for distributed network computing," Desnoes said, a longtime broadcast TV veteran with ABC who still owns a station in Bakersfield, Calif.

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