Orb Networks founder and CEO Joe Costello moved around a lot while he was growing up. His father was an executive with General Motors. Twice, he lived in Santa Barbara, California, where he developed a passion for surfing.
All of this is a little ironic, given the fact he heads what is now probably the premiere placeshifting service company in the world, Orb Networks, whose placeshifting software, relies entirely on the magic of the Web and AJAX, instead of bulky, expensive boxes.
Orb Networks, as it stands today, was never Costello’s intention. The company was actually one of four spun out around the turn of the century by Costello and his partners. In fact, it was the fourth.
The initial plan was to develop interactive TV for educational purposes.
The Orb of today provides users with the ability to stream all the media on a PC to just about any device with an Internet browser. This runs the gamut from cell phones to game consoles to other PCs to portable media players.
The route from interactive TV for education to placeshifting platform has been filled with numerous course corrections.
“Sometimes course corrections take you in a 360,” said Costello.
Orb originally launched in the spring of 2005 without much fanfare.
Costello said he and his team had tried shopping Orb to various technology companies, but didn’t meet with any success. But, he said, at the end of those meetings, after rejecting the technology, people would always ask if there were any way they could use Orb personally.
That’s why Costello and his team decided to go directly to consumers with Orb.
He and his team also made another wise decision. They initially planned to charge a subscription fee of about $3 per month. Costello was quick to point out his memory of the amount of the fee is vague, however.
What he did remember clearly is the question he and his team asked themselves about charging a fee: “Does it make sense to have that barrier?”
The answer was no. Costello said there were better ways to monetize Orb.
Orb generates revenue through ads. That’s the simplest explanation. “People will only pay for so much,” said Costello. “They like ad-sponsored content.”
But Orb offers a platform for advertisers few can hope to match.
It gathers up user data and matches this info to the content the user is streaming. Costello called it “Nielsen on steroids.”
In this model, data never leaves the user’s PC. The promotional engine runs entirely downstream. It only pulls down the appropriate ad content after matching it with the content the user streams.
“In the case of Orb, those ads can be personal,” said Costello. “Orb gives content providers and advertisers a way to understand user needs and better monetize their content.”
Costello likened the experience to the surfing magazine he used to read when he was growing up. He said he and other surfers actually enjoyed the ads as much as the articles, because the ads featured products specifically interesting to him and the other surfers.
Costello said he and his team approached Sony and the PlayStation 3 development team about providing Orb to the PS3. He said they pointed out the pairing could make an incredible gateway between the TV and the PC.
But in the end, he said, Sony decided to turn Orb down.
According to Costello, the Sony people said they rely on selling about three games per console to turn a profit. But if they bundled Orb with the PS3, they worried the placeshifting technology would draw consumer interests away from PS3 games and more toward using the console as just a media bridge, which would reduce game sales and Sony’s profit.
Costello said he and his team also approached Microsoft and the Xbox 360 development team and were turned down once again. But, they never thought to approach Nintendo.
Of course, within two hours of the beta release of the Opera Internet browser for the Nintendo Wii, the Internet Channel, the Orb forums “went nuts” with Orb users discussing how to use Orb to work with the Wii.
“Like idiots, we never went to talk to Nintendo,” said Costello.
“They’re losers,” he joked.
Two weeks later, Costello and his team had revised the Orb interface to better accommodate gaming consoles, like the Wii in particular. The Internet Channel browser employed by the Wii only supports the Flash video format. Costello admitted when he first saw videos being streamed from the Wii over Orb to a TV he thought it looked, well, kind of crappy. So the Orb crew went about improving on the video quality and the Flash video player. And he said it looks okay now.
Costello also said the “Nintendo guys” weren’t expecting Wii users to become so enthused about Orb. He said when they did realize what was going on, they were like, “This is cool.”
The Orb folks are still working to improve the Orb experience for console users. Costello said they’re talking to Adobe and Nintendo and they have been having “good conversations” with Opera.
This burst of consumer interest in Orb also means more devices are going to open up to Orb in the future.
One of those devices could be the Nintendo DS. The portable gaming device supports Wi-Fi and with a packaged pairing of a Gameboy Advanced and Nintendo DS cartridge (the system has two cartridge slots), which is currently only available in Europe and Japan, it can run a version of Opera’s Internet browser.
But Costello said the problem with bringing Orb to the DS is the DS doesn’t have a media player, yet. He and his team are working to try to “fix” the DS.
It’s worth noting the less powerful, older Gameboy Advanced can play video, and there are even video cartridges featuring cartoons available for the device. There are also unlicensed TV tuners available for it.
The DS’ primary competitor, Sony’s PSP, actually has everything Orb needs to run, but Costello said Sony consciously shut down any outside content to promote its own content on the portable gaming device.
Roughly three weeks after the announcement came out about the Wii supporting Orb, Sony opened the PS3 to support the placeshifting software as well. Costello said he expects something similar will occur when the DS is open to Orb.
Costello also hinted Microsoft’s Xbox 360 might be opening up to Orb in the future.
He expressed the whole situation succinctly. “We’ve been trying to make sh*t happen,” said Costello. “We love these boxes.”
He said the “boxes,” which breaks down into anything that can support an Internet browser, are creating a very fertile territory for Orb. And these Internet-enabled boxes, as well as the serendipitous success from the Wii’s browser, have created an opening for Orb that hadn’t really existed before.
“We want to drive a truck through this,” said Costello.
Orb 2.0 has been released into beta and boasts a set of new features trending toward the social networking, Web 2.0 direction. Users can organize their media into tabs, with each tab containing user-defined modules, such as TV guide, personal media files, RSS feeds like YouTube videos and the local weather forecast. It also gives users a home page.
Orb allows users to share their media with friends and family and it also features an “Other Orb Users” tab, so users can see what media other Orb users are experiencing.
Costello said sharing music over Orb has changed his life. He’s discovered music from his friends and co-workers he would have never come across otherwise, which has given him a new appreciation for music.
Also, he said Wii users are sharing their playlists from their living room TVs of the videos they’re watching and the music they’re listening to with other Orb users.
But Costello said he and his team just want to provide the software platform then get out of the way. “We don’t want to be a destination site,” he said.
Orb has some surprising numbers concerning the media its users are streaming through the service. And like many, Costello admits the numbers haven’t been what he expected. “My first initial reactions haven’t been dead on,” he said.
Costello believes that people haven’t quite gotten used to having any media, anytime, anywhere. The number of minutes users spend on each Orb session is up to an average of 22 minutes. A session is defined as a period during which a user streams media through Orb.
In the last three months Orb has seen 1.6 million sessions. The numbers show that once people start using Orb, their usage grows, said Costello.
PCs usually have the longest sessions, followed by large screen mobile devices (not necessarily smart phones) and small screen mobile devices in that order. The average Orb user spends 60 minutes a day using Orb.
Costello also said the percentage of Orb users with TV-tuner cards has grown to about 66% and some of those users actually purchased TV-tuner cards for their PCs to specifically stream live TV or recorded TV. Streams of recorded TV and music over Orb are virtually equal in number.
The ratio of video streamed compared to audio is roughly three-to-two across all devices and formats. This is a startling figure, considering a digital music library is just one source of media compared to the multiple video sources available in the form of DVRed TV shows, home videos, YouTube videos and downloaded videos.
And yet with all these video sources combined, video just ekes by audio.
Costello said these numbers surprised him, but he and his team figured out the cause. People love to listen to their music at work on their work PCs.
Orb gives users access to their entire digital music library stored on their home PC on their work PC, where they can have speakers, the massive storage of their desktop hard drive, no limits on battery life and don’t need to carry around and keep up with a relatively fragile portable music player.
On the PC specifically, the ratio of video streams to audio streams is about two to one. Costello said he expected video would be much more favored on the PC. There has also been more TV and video being streamed to mobile devices than expected.
Orb automatically reformats video for the mobile screen, so users can DVR a TV show on their PC then watch it on their mobile device when they have time to kill.
Costello said music and audio usage are basically split on mobile handsets. But, video has an edge over audio with a slightly more than two-to-one ratio on large-screen mobile devices.
Another surprise for Costello and his team came from the first numbers they got back on the Wii users – they have been using Orb to stream audio from their PCs to their TVs.
Costello believes this is due to the fact the living room is generally a more comfortable place to listen to music than where PCs are kept in households. And he said the sound quality, especially on the newer TVs, is an improvement over typical PC desktop speakers.
A fun fact – Orb users with certain Windows Media Center PCs and a WMC-compatible IR blaster can actually change the channels on a set-top box through Orb, while outside their homes, if they get the urge to do some channel surfing on their mobile phone, laptop or office PC.
Costello said Internet-driven entertainment will be transformational, but the mingling of the Internet and media is “in its infancy today.”
“The Internet expansion we’ve seen in the last 10 years will pale in comparison to what we’ll see in entertainment,” said Costello. “You’re going to have 10 million channels.”
Digital media is rich, he explained, and users need tools to package it up the way they like. Costello also gave up the formula for his simple PH or acid test for how pervasive a technology has become: Whether or not his mother is a participant in it. If she can watch her Orb channel, have access to family videos and pictures, then it’s pervasive.