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It started with the grainy, sometimes out of focus video clips on YouTube. Since then, ” Video on the Internet has gone from being the next big thing to the current big thing” according to an Associated Press Report. Nearly a dozen video related start-up companies will be presenting their ideas at the DEMO 08 technology conference, starting today in Palm Desert, California. This conference is notable for helping companies acquire investors for their newest ideas. Projects such as the Java programming language, TiVo Inc, and Half.com have all received seed money from investors who saw their idea and decided to go for it.

This latest new idea will require investors with deep pockets who see the future of video on the internet. The AP report continues–

“Several of the 77 companies presenting this time have been tackling the problem of taking video quality to the next level. It’s quite possible to send high-definition video over the Internet, but the cost of doing it at scale is daunting, because it requires about 40 times the bandwidth of a YouTube-quality video.

“If you run any infrastructure that lets people share video, it’s really, really expensive,” said Dan Putterman, chief executive of San Francisco-based Squidcast Inc.

The company is launching a service that allows users to send video they’ve shot with their high-definition camcorders to friends and relatives at full resolution, for free.

To do this, users will take help from other users, in a manner similar to peer-to-peer file sharing programs like BitTorrent and KaZaa. Each file that is uploaded gets distributed in small chunks among the computers of many users (who won’t notice the chunks or be able to look at them). The intended recipient gets an e-mail with a link. Clicking it starts the download, which pulls the chunks together from the network of user computers like a squid pulling in its tentacles.

In other words, Squidcast itself doesn’t need to devote computers or buy bandwidth to transfer user’s files. It will finance the service by showing short video ads to the recipients while they download.

“If someone attempted to do this as a hosted platform they would simply go out of business,” Putterman said. “It can’t be done and that’s why it hasn’t been done.”

One of the challenges facing companies who win the investors for this project is the internet was not designed for transferring HD size files.

“Under regular Internet protocols, all the little parts that make up a file take the same route over the network, even if that path becomes congested during the transfer. Asankya’s Hypermesh service, which it is previewing at the show, can send individual parts of a large file over different routes, then reassemble them in the right order.

“We just use the network much more efficiently,” Ryan said. “We get cost advantages out of that.”

The technology was developed by a Georgia Institute of Technology professor and uses servers placed at strategic points on the Internet in addition to information sent in by receiving computers.”

So, this is a story worth watching. Video on the internet may not currently be a big part of your company’s advertising portfolio. But there is no doubting it is an untapped resource for many small businesses for getting their message out. It’s free. It’s popular. It is effective. Soon, all of that will be true in HD style. Stay Tuned!

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