IBM Leaps Into Video Delivery

IBM on Tuesday revealed that it has acquiredClearleap, a company that develops cloud middleware for streaming video between endpoints.

Clearleap’s scalable video platform can support millions of concurrent users in the event live broadcasting is in high demand. Customers of the company, which recently raised $40 million in funding, include the NFL, Time Warner Cable, Verizon and HBO.

IBM intends to integrate Clearleap’s video platform into the IBM Cloud for enterprises looking to manage, monetize and expand user video experiences and deliver them securely via the Web and mobile devices.

The acquisition is part of IBM’s broader strategy for its Platform as a Service offering. Clearleap will add a new facet to that strategy: Web video.

The acquisition has the potential to create “huge, discrete business opportunities for online video,” said Charles King, principal analyst for Pund-IT.

“While I expect Clearleap to continue serving and pursuing entertainment companies, like its existing clients — HBO, Verizon, TWC and so on — the deal clearly reflects IBM’s belief that video will grow in importance among the company’s enterprise customers and eventually become common in business content/communications,” he told the E-Commerce Times.

The deal may appear mundane, but it will be interesting to watch how it progresses, said brand consultantEvan Carmichael.

IBM “has had 14 consecutive falls in quarterly revenue,” he told the E-Commerce Times.

“They’re shifting from hardware to cloud computing, and since they are forced to buy their way in since they haven’t kept up on the R&D side to stay relevant, they’re up against established players like Oracle and Microsoft as well as Internet-based businesses like Salesforce.com and Amazon.com,” Carmichael said.

IBM declined to disclose financial details of the deal.

Head in the Clouds

As its hardware business rusts, IBM has been stepping up efforts to pivot to the cloud and establish itself as a heavyweight in the sector. While it has focused on cloud storage in all the popular flavors, as well as development, the company also has been laying the framework for Web video.

It acquired Aspera in 2013 to boost large data transfers, and this year announced it was buying Cleversafe for its object-based storage. Both of those platforms will be used to support Clearleap’s platform.

IBM has its toes and fingers in range of high-tech sectors, notedTirias Research Principal Analyst Paul Teich, who once worked with video compression technologies.

It might have been a bad use of time and money for IBM to try to build out a video delivery service from base ingredients, he told the E-Commerce Times.

“I wouldn’t call it the final days of print, but we’re certainly moving to a more postliterate society,” Teich said. “People want to communicate directly with one another in real time, using natural communication methods, with video being one of them. So I see this as a move on IBM’s part to catch up.”

IBM has been playing catch-up because other cloud players are so far ahead. However, the growing strength of IBM cloud has pushed the company into a good position, and other power players, such as Amazon Web Services, are far from invincible, according to Pund-IT’s King.

“That’s especially the case if you take into account the problems AWS has had with its own service, like the database glitch in September that halted Netflix’s and Amazon’s video services,” he said.

Video on Demand, in Demand

Video has become increasingly important, and quality matters a great deal, according to Teich. People care about color accuracy, compression artifacts and a stable frame rate.

“People are visual creatures,” he said. “When you look at how much we understand through our eyes and how quickly we understand it, it’s perhaps the dominant sense that we have in terms of sensing the world around us and interacting with other people.”

It isn’t easy to deliver the “high bandwidth our eyes want to see,” Teich said. These days, people want Web delivery of content to their mobile devices — “cloud first, mobile first,” as Microsoft once phrased it.

Purchasing Clearleap “is a good catch-up move,” he said. “Certainly it’s not too late for anything.”