Blockchain is bringing about Internet 3.0. Are you going to be involved?
5 min read
Opinions expressed by Entrepreneur contributors are their own.
The internet revolutionized the way the world operates, stays connected and communicates — that was Internet 1.0. Internet 2.0 then arrived, to overhaul static web pages, making them more dynamic, as well as strengthen mobile applications and the responsive web.
Related: Omar Kassim’s Esanjo Uses Blockchain To Reimagine Real Estate Investment
At this point, today, we are entering the next phase — or Internet 3.0, which many experts are calling it (check out this CoinDesk article). Internet 3.0’s central factor? Blockchain technology, which seeks to decentralize everything from banking to healthcare to real estate.
Video-streaming is poised to play a major role in the coming Blockchain world: As online content has exploded, video-streaming has become the de facto way to watch movies and videos online. It’s also led to the “cut the cable cord” movement. Blockchain will enable this trend.
The Big Three
Today, the majority of efforts in the video storage, computing, encoding, networking and streaming categories are led by three dominant brands: Amazon Web Services, or AWS (34 percent), Microsoft (11 percent) and Google Cloud (8 percent). AWS is so big that it generates the major portion of Amazon’s profits — some $10 billion-plus in annual revenue, TechCrunch says. AWS hosts data for megacorporations like Comcast, PG&E, and Netflix, which all rent space on its servers.
Streaming and encoding are areas ripe for disruption, as Blockchain technology expands storage options by spreading data across the blockchain computer network. Streaming video will be able to tap into underutilized computers through the Blockchain, which will dramatically reduce streaming’s cost, in ways detailed below.
Related: 5 Ways Blockchain Technology Will Change the Way We Do Business
Startups such as VideoCoin see this trend as an opportunity and are entering the arena by providing the means for video content to be distributed at a fraction of the price. Haley Minor, an investor in VideoCoin as well as CEO of Live Planet, recently shared some thoughts with me about the ways in which Blockchain technology is poised to take over online video-streaming.
The explosion of online video
Video changed everything. Where there used to be text blogs, we now have vlogs, YouTube channels, Facebook Live, Snapchat and podcast interviews.
Where images or text used to appear in digital ads, we now see animated GIFs. Live video-streaming, meanwhile, has become insanely popular across mobile apps and social media. Companies like Netflix, Hulu, and Amazon have put old-fashioned video rental out of business, and DVDs are quickly becoming a thing of the past. “Video is exploding — growing by 25 percent per year,” Minor told me. “All companies now use video for marketing.” (The explosion of video-streaming and thoughts about its future use are further reinforced in this ReCode article.)
Since video usage is significantly increasing every year, improvements in the way it is stored and streamed are becoming all the more essential.
Enter the Blockchain.
Blockchain technology is an unanticipated breakthrough and its capabilities are far-reaching. Its popularity has skyrocketed with the creation of cryptocurrency, and it’s toppling established market leaders and creating opportunities for a new generation of startup entrepreneurs. “The reason anything sticks around is that it makes business more efficient,” Minor pointed out.
Specifically, Blockchain tech brings together computers all over the world in a peer-to-peer network with no central server required. The technology supports the authentication and transfer of digital data, where each “block” has pointers encoded to the preceding and following blocks. This process is private secure, and permanent, eliminating the need for middlemen, and in the case of video, cloud-storage providers.
Minor told me he intends to run the VideoCoin Network largely on unused or underutilized servers in data centers, where, he estimates, there are about 20 million servers, 30 percent of which are idle at any given time, and another 20 percent aren’t being used at all.
“You’ve got $10 billion to $20 billion of data center assets that are doing nothing,” Minor said. “This presents an opportunity to efficiently harness unused computing power to process and encode video.”
Benefits of blockchain technology in the video-streaming Industry
Current video-streaming offers have incrementally increased costs in order to store all that content out there and all those massive video files on servers. This has meant large margins for the controlling companies, and these expenses have trickled down to the content creators.
Blockchain technology, however, promises to cut down these costs and give content creators direct access to their revenue. The Blockchain also promises to offer “smart contract” technology, providing a multitude of avenues for video content to be stored and shared under a heavily encrypted and secure system.
While today’s blockchains cannot handle video-streaming due to long transaction times and limited computing capacity, there are new blockchain-backed companies being built specifically to enable those faster transactions. “Miners” (those adding transaction records to the public ledger of past transactions) will be able to load software onto their computers or servers and effectively rent their excess computer space; they’ll be incentivized by rewards in the form of cryptocurrency or tokens.
Utilizing the same philosophy as the sharing economy, miners will simply store video on their excess disc space and stream it with their excess bandwidth. This process will have the ability to lower the cost of distributing video.
A revolution is coming.
The evolution of technology will continue to change the entertainment and streaming industries. Just as the internet rendered brick and mortar video-rental stores obsolete, Blockchain technology will soon completely overthrow the current realities of video streaming –and become ubiquitous.
Related: How Blockchain Is Creating a New Future for Digital Marketing
Current leaders in online video-streaming simply will not be able to compete — or be willing to give up market share — to a decentralized network. So, those leaders will have to adjust accordingly. That’s how the revolution will begin — and in fact already has begun.
