May 2002 – Dealmemo.com
One of Hollywood’s scariest Internet monsters, whose online streams of TV shows were killed off by an angry mob of lawsuits, has been resuscitated, this time as a would-be ally set to resume operations this weekend.
The Net-based iCraveTV will have a slightly different Web address — http://www.icravetv.biz — than its predecessor, and a substantially different purpose: showcasing the Netcasting hardware and software of parent company EnterVision while providing authorized access to video from the BBC, Miracle Entertainment and a dozen U.S., Canadian, European and South American networks.
The original iCrave started up two years ago in Canada, providing fans with online streams of their favorite U.S. television shows. The company made its money by surrounding the streams with banner ads. But it quickly attracted the legal fire of the industry’s biggest organizations — including the Motion Picture Assn. of America, the NBA and NFL and the major networks — and was shut down.
EnterVision, whose predecessors have been working on proprietary Netcasting technologies since 1995, picked up the iCrave name and began cutting deals with broadcasters, the biggest potential buyers of its technology, to use the EnterVision hardware and software on their own Web sites and the revived iCrave site.
None of the content deals involve any money, much less advertising or possible profits, but iCraveTV president-CEO Herbert Becker and other company execs said the long-term plan is to turn the site into an online version of a cable operator, charging carriage fees to participating networks.
EnterVision makes its money now by selling both hardware servers and software needed to transmit video over the Internet, with prices for software ranging from $200 for hobbyists to $2,500 for professional operations.
According to the site, more than 39,000 copies of the various software packages have been downloaded. EnterVision also sells hardware servers packaged with the high-end software for $25,000 each.
The technology relies on a type of program called a Java applet that runs on most common Internet browsers and computer operating systems. The applet converts, on the fly, frames of NTSC video signals into equivalent frames of digital pictures in the widely used JPEG format and ships them over the Net for viewing.
EnterVision also is using a different approach in its dealings with content providers, guided in part by Phil Craig, the iCrave founder who serves as an adviser.
“We’re not going to be doing anything without permission,” Becker said. “We’ve spoken to the rights holders, and they’re actually quite keen on it. They see the use of the Internet for getting their content out there. The reality is this: They want as many eyeballs as possible. The Internet gives them more eyeballs.”
That upfront permission will be key, said David Kent, a partner at law firm McMillan Binch who helped Canadian broadcasters bludgeon the original iCrave and JumpTV.
“The bottom line is, if they’re going to take Canadian signals and transmit them over the Internet, then it raises all of the issues raised by iCrave.com and JumpTV to broadcasters,” Kent said. “It does look like a son or grandson of iCrave, and I think you could expect the stakeholders, depending on what happens, are likely to have the same reactions as they did to iCrave.”
EnterVision’s majority shareholder is Mohamed Hadid, an investor who has had major holdings in the Ritz Carlton hotel chain and Options Talent Group, a Los Angeles talent scouting shop in whose Wilshire Boulevard offices EnterVision is temporarily quartered.