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19 August 2021

Veset’s cloud playout scores popup wine channel win

Pop-up online TV channels have been gathering steam for some time, many fueled by the impact of the Covid-19 pandemic on traditional shopping habits. Many retailers have explored new ways of reaching consumers, and cloud playout vendor Veset recently caught our eye, having deployed just such a channel for 67 Pall Mall – a wine merchant.

When the pandemic began to take hold, 67 Pall Mall began trying to engage with its members via Zoom meetings, as an alternative to in-person tastings that can take up to a year to schedule. However, 67 Pall Mall found Zoom lacking, and wanted to offer a better experience to its customers. This is where Veset came in, to help drive sales of wine to members that can participate via the channel.

Speaking to Faultline this week, Veset CEO Igor Krol explained the technology behind the website and channel. The wine venture is using Nimbus, a cloud-hosted SaaS offering that Veset makes available as a web application, paid for by monthly subscriptions, and then streaming the channel via Red Bee Media’s OTT platform. Veset hosts the playout infrastructure and provides support, but can also provide a self-hosting option for some customers.

Nimbus has been available since 2015, and Veset’s customers are a mix between the old guard and new entrants. Playout for linear TV, Krol said, puts a lot of people off, who associate it with legacy technologies and processes for assembling a TV channel out of a blend of pre-recorded video and live feeds.

As for the uptake of cloud playout, Krol said that AWS believes there are around 3,000 TV channels in the cloud now. Discovery and Fox are prominent cloud playout adopters, but Krol warned that the biggest potential customers are also going to be the slowest movers, due to their capex and organizational burdens. For popup channels, Krol believes cloud playout will serve 100% of those deployments, in time.

Krol said that Nimbus provides an easier user experience, where on-premises appliances and costly engineers can be replaced by the web application. Nimbus does require a little training, he said, but added that customers can easily set up a channel within twenty-four hours.

Veset does have some customers from the traditional broadcast world, but Krol said that the new entrants are much easier to acquire, as they do not have the same established preconceptions that prejudice a broadcaster against cloud playout. In addition, Veset offers a stripped-down service called Stratus via AWS Marketplace, for smaller operations that want to embrace the flexibility of cloud-based playout.

As for what Veset is replacing, Krol said it was mostly older on-premises deployments, most of which are specialized software running on off-the-shelf workstations. Nimbus aims to be cheaper by being multi-tenant, sharing the twenty or so microservices that power the application between many customers, and sharing that cost across the board.

Of course, multi-tenant deployments are anathema to the conservative broadcaster ethos – where having a dedicated physical work area populated with trained playout engineers has been the conventional way of doing things for years. Convincing those decisionmakers is difficult.

Krol explained that it can be quite tricky to map out the cost savings of the cloud-based approach. This is usually because in larger broadcast operations, the engineers used for playout have a number of other duties. In smaller operations, you will require a dedicated system for each channel, and an engineer to oversee them, but there tends to be less overlap between those playout specialists’ duties and other functions.

So, in smaller customers, it is easier to make the case on purely a cost basis. Krol said that by removing the engineers from the mix, the cloud-based playout approach can be half the price of the old method – usually landing in the 20% to 50% range. However, in the larger organizations, the total cost of ownership (TCO) is the metric you need to focus on, and engineers with multiple roles muddy that evaluation very easily.

Krol likened the TCO problems to the question of shifting from diesel vehicles to electric ones. The costs and problems of diesel are understood by most, but the new way of doing things is not as well known. Even if an EV suits your needs perfectly, many potential buyers are still going to avoid that purchasing decision until they absolutely have to.

Mid-sized operations are a bit of a sweet spot for the Nimbus pitch, said Krol. They want to avoid the infrastructure headache of on-premises playout, but are also less driven by live video – typically with more pre-recorded content than the largest broadcasters.

Smaller operations that are exploring popup channels are also excellent targets, where buying an appliance and hiring an engineer for a channel focused on a live event that will be quickly spun up and down makes no sense. 67 Pall Mall is an interesting blend, as it is a small operation, but also wants a 24/7 channel to help drive interest in its membership service.

Of course, there is a lot of ground for semantic debates about what precisely constitutes a TV channel. However, given that so many TVs now have native web connections, any internet-hosted video stream is competing with the venerable channels inside an EPG. Worse, for such channels, is that popup channels can have extremely niche focuses, in a way that even the most tailored or curated TV channel cannot.

As more viewing options have arrived, the traditional viewing audience has fractured into hundreds of smaller demographics. There are very few shows and events that capture enough interest to become watercooler topics, which leaves plenty of space for the smallest of channels to arrive – fueled by affordable cloud-hosted production and distribution tools.

Krol joined Veset in 2013, a couple of years after it was founded, in Riga, Latvia. Veset’s founders were initially trying to launch a TV channel in the country, but faced an acute problem of requiring specialized hardware and an expensive engineer. Those financial constraints are not a burden on the large broadcasters, and when Veset found that there were no SaaS options, despite those being an obvious solution to that problem, it went about building one.

The founders were not from the broadcast world, coming from an IT background, meaning they had a natural affinity for the SaaS model. Krol noted that playout is still a very niche offering, existing on the fault line between production and distribution, where thousands of different elements need to be processed and managed in real time. Cloud playout, Krol stressed, allows for a much more flexible approach.