Q&A with Vuclip CEO Nickhil Jakatdar

Just yesterday, the mobile video search and delivery service Blueapple.mobi announced that they had reidentified themselves as Vuclip.com after a year and a half of developing under the radar. Unlike most video delivery services which pre-encode and store a library of videos for each handset’s required format and resolution, Vuclip transcodes videos from a number of popular video sharing sites on-the-fly, beaming it straight to your handset in a format that it can handle.

I had the opportunity to sit and chat with Vuclip’s CEO, Nickhil Jakatdar, about their recent shift out of the stealth space, their name change, and the future of the service. I’ve transcribed the Q&A session below:

So, what is Vuclip?

Vuclip is a mobile video search and delivery service. Basically what any consumer can do is go to the browser on their phone and, without downloading any application or client, they can go to Vuclip.com, click in the search terms they are looking for, and play those videos.

A big part of your coming out of stealth is the name change, which also involves a top-level domain change. You were blueapple.mobi, now you’re Vuclip.com. Why the changes?

The primary reason for the name change is the fact that when we launched [Blueapple] about a year and a half back, we felt like the dotmobi domain would take off. We were unable to get the blueapple.com. What we ended up finding is that the dotmobi domain is very awkward for many people to remember. By default, they would go to blueapple.com, and that ended up being a squatter site. Whoever was squatting on it realized that Blueapple was doing pretty well, so they made themselves look like our video search. We ended up seeing a lot of leakage that would go there, believe that that was us, and wonder what was so good about it.

So, we felt that we needed a .com, and since Blueapple was unavailable, we tried to find a name that was indicative of what we do.

I was searching through Vuclip, and I noticed that the search takes in Metacafe, Daily Motion, and Youtube. Are there any that I’m missing?

We index about 20 sites, but the majority of our hits are coming from those three. If you were to search from India, China, or any of the other countries, you’d find more relevant content from a localized point of view. A lot of Chinese and Indian sites are also indexed.

A pretty good amount of computational power goes into transcoding on-the-fly, and I’m guessing Vuclip probably uses a good amount of bandwidth. Both of these are expensive. Whats your money model?

There are a couple of answers to that. In general, video is a heavy application, as you pointed out, so the infrastructure and bandwidth are extensive. With that, we’ve been doing this for the last few years, and we believe that we’ve been able to make this more effective and efficient than anyone else out there. While its heavy, our cost structure is truly lower than almost anyone else that we know of. That weight is one of the primary reasons that today very, very few people do on-the-fly encoding – Almost everybody does pre-encoding.

Having said that, our business model is two fold. For the direct to consumer, it is an advertising based business model. We’ll do banners or text ads on our search pages, as well as video ads — but we’ll only put video ads for content we have a partnership with. For example, we have content with CBS. With the CBS copyrighted content, we could stitch in video ads and share revenue with them. For the B2B [business-to-business] side, we have two models. If we power their videos, we will do it either on a revenue share model (with their branding), or we will charge them on a per-video basis. For every video we enable for them, we would charge them a few cents

Is there anybody else doing this that you’re aware of?

A lot of people talk about it, but the only other ones we’ve actually seen doing it is a company called Ripcode. They’ve actually built special-purpose hardware for doing this, which we’ve found is not cost effective. It does the job, but you can’t scale economically with that type of solution.

Everyone else that we know of does pre-encoding. They’ll cache whatever they’ve pre-encoded, and if [the user requests] something that they’ve not seen before, almost nobody else handles those because pre-encoding does take time. The only company that we know of that does pre-encoding on videos they’d not already seen before puts them into a queue. The problem with that approach is that the user wants to watch the video[when they want to watch it. If you put it in a queue and tell the user to come back in 10 minutes, most of the users will be gone by then.

Where do you guys draw the line with partnered content? Would Vuclip partner with *cough* “disagreeable” content?

We have been very clear that we will not syndicate content that is adult. Now, for our search results, we don’t want to be the model piece for the world… Just like Google, if you put in adult content search terms, you get adult content back. For the search piece, you will get back whatever you search for. However, for the syndicated content that we show on our front page, we will not go out and syndicate any adult content.

What’s next for Vuclip?

Let me briefly describe where we are today in terms of our numbers. There are a lot of press releases out there talking about doing mobile video, but one of the decisions we made a long time back was that we didn’t want to be one of the many talk about what we were going to do. What wanted to do was talk about what we’ve already done.

We launched Blueapple.mobi in May 2007. Our goal was “Lets prove to ourselves that this is truly a scaleable technology” — that we could scale both in terms of videos as well as a business model with our technology. Once we’ve proved that to ourselves, we’d go out and do a big press promotion and all that. The first few months after we launched it we didn’t talk about it, and hence it was just a few hundred users who watched a few thousand videos. People liked it a lot, so it was a very “sticky” application. We put in the tell-a-friend feature, and by November or so we’d gone from a few thousand users to a couple of million — in 6 months. There were over 90 million page views in the month of July alone. All of this has been with an 8.5 thousand dollar marketing budget. We’re not buying users, or buying advertising. The only place we have [advertised], starting last month, was GetJar[.com]. Other than that, no promotion. What we’ve found is that when users like it a lot, they go and tell their friends about it.

Once we came to that number, the 90 million page or so views, we decided that now was about the right time to go talk about the fact that we are a legitimate service, hence all this press.

To answer your question about “What’s next?”, a lot of the features we put into Vuclip (relative to BlueApple) were features aimed at building this community around our site. To take [the community] to the next level, we needed to put in certain features like where you can create your own playlist and share that with friends, or set it up where you can get alerts [..] for whatever it is that you care about. You can get an SMS sent to your mobile every day or every week (depending on how you set it up) from which you can watch those videos.

There are a couple of features like that, that help to build the sense of community and the “stickiness” of the site. Our goals are to keep going down that path, to keep growing the traffic at the rate we have so far, and have monetary visions go hand-in-hand with that so that we are a legitimate stand-alone business. This is my fourth start-up [..] and I’ve been lucky that each of them have been successful — but if I learned one thing that was common to all of them, it is that we have to build this to be a sustainable company and not build it for an acquisition. Those things rarely work as per your plans.