Video is Eating the Internet.
Video is a megatrend. It’s not just a big part of the web; it’s on its way to becoming THE dominant way we consume content online. Today, YouTube has more than a billion users worldwide, Americans watch digital video for over an hour each day (twice that much for Netflix subscribers), and online video accounts for nearly three quarters of internet traffic with projections to top 85% by 2019. Mobile has just tipped as well; 55% of mobile internet traffic is video and the volume of mobile video is expected to increase eleven-fold between now and 2020.
At Bessemer, we’ve been investing in video at every layer of the stack for the past decade. From consumer platforms like Skype, Twitch, Dropcam and Periscope to video monetization solutions like Adap.tv and video delivery infrastructure like Vasona and Qwilt, we see tremendous opportunities across the video landscape.
For consumer video specifically, we’ve assembled the BVP “Videoscape” — our first attempt to categorize the top 135 consumer-facing video companies into nine different categories.*
Note that the lines between these categories are blurring. In the past month alone, Amazon Prime announced its UGC content creator effort, Spotify is creating 12 new original content series and Twitter unveiled a partnership with the NFL to stream Thursday night games. We’re excited to continue to watch this evolution as the chess moves continue.
Looking to the future, there are many areas of consumer video that we’re particularly excited about:
Areas we’re excited about: live verticals, consumer tools and curators.
Live Verticals — We’ve been anticipating the potential of live ever since our seed investment in Periscope in 2014. We believe the best way to solve early platform challenges like discovery and content creation is through content verticals. Twitch has proven that this model works in Gaming; we’re looking forward to seeing startups address new verticals like music, news, sports and more.
Consumer Tools — Instagram held our hand and helped us become professional photographers. Who’s going to help us become professional storytellers? YouTube vlogger Casey Neistat spends up to 8 hours editing his daily vlog. For those of us that are not superhuman, we need a simple solution to create compelling, fun and engaging content on a daily basis.
Curators — Some estimate that 500+ hours of video are uploaded to YouTube every minute. That’s just YouTube and doesn’t include Snapchat, Facebook, or any of the other 100+ companies we’ve highlighted above. There is simply too much video. It’s one of the reasons that Snapchat’s ephemerality is appealing, and why we believe a cross-platform curator can build a large audience in today’s digital world.
New video companies are being created every day and the ecosystem is evolving more rapidly than we can update this post! If you are a founder in this space, we’d love to hear from you. Shoot us a note at firstname.lastname@example.org.
*The categories we’ve assembled include:
- Video on Demand (VOD) — platforms that primarily aggregate User Generated Content (UGC) like YouTube, Vimeo and Vidme.
- Native Video Networks — social networks that create video primarily for their own platforms like Snapchat, Vine, Musical.ly and Smule.
- Live Platforms — the top horizontal and vertical live broadcasting products like Periscope. If you don’t recognize the circular red logo in the middle, you will soon. It’s Facebook Live.
- MCNs (Multi-channel Networks) — aggregators of multiple YouTube or other platform channels to provide programming, creator support and more.
- Curators — assemblers of the best video from the web that organize feeds into a digestible format for your binge-watching enjoyment.
- Creator Tools — products that work to help content creators get paid, find work, build their audience and more. Early leaders include Popular Pays, Patreon and Famebit. This is the newest category of the bunch.
- Consumer Video Tools — products that help consumers create interesting content. Today, most of the videos created on these services get shared to other larger social networks. In the future, many of these products want to move toward being a Native Video Network.
- Content Aggregators — businesses that license premium content from major TV and movie studios. Now, many of them like Netflix, Amazon and Hulu are building their own content and stacking Emmys on their mantle.
- Original Content — studios from both the old and new guard of media. This is the category with the most to lose.
Full list of companies below: