November 6, 2007

Video ads broker says best part of open source is the cost: zero

Author: Tina Gasperson brokers online video ad space and creates commercials for clients to embed in existing content, similar to television advertising. CEO Jake Varghese calls his company "AdSense for videos. It's a way for video publishers to monetize their work." Publishers can create their own commercial content, or hire to create it for them, and then insert it before or in the middle of the videos. Varghese is a big proponent of open source; he says he wouldn't use anything else to build his business.

The name is a play on the .flv extension used for Flash videos. Varghese was inspired to launch after helping a friend launch a video blogging site for those in the US military. "We realized that there's not a good way for video content publishers to make money online. We tried Google AdSense for videos, but the ads are not inside the video. I developed so that advertisers would have a way to insert commercials into the content, anywhere."

Varghese was familiar with open source software from his college days studying computer science. "They teach mainly on open source software," he says. "We'd pull code out of the Linux kernel and that's what we'd study." In school, Varghese also studied Web development, and "all the open source choices that go along with it -- should I go with Linux and MySQL or with Windows hosting? The choice was easy for me: I didn't have any money. The Linux packages were always cheaper." By the time he made up his mind to launch his own business, LAMP (Linux, Apache, MySQL, and PHP) was the only smart choice.

"It's cheap, and the only downside is there's no real support -- there's no company that supports you," Varghese says. "But I didn't need that. I'm a developer. I can figure it out. And since it's open source, there's all kinds of forum postings and people who have done something similar to what you're doing."

Varghese doesn't use open source for his Flash animation work, but says he is looking forward to the time when Adobe will free up Flex 3, the next version of its semi-proprietary Flash development framework.

Varghese is not seeking venture capital financing for "We're going to try to be a grass-roots effort," he says. "The main challenge is getting it done, getting all the open source tools set up. You have to do it yourself, you have to read through the documentation, go all across Google, find out how to make this piece of software connect to the other piece ... we had to learn. We'd done it before, but it can be different if you're a startup."

Varghese says that entrepreneurs should opt for shared hosting if they're not intimately familiar with the methods for configuring a LAMP stack. "If you don't have the people to help you put it together, and you can't hire them, get outside help for sure. Don't try to do it in house. The person that's putting the stuff together needs to know what they're doing."

Another tip from Varghese: "Use as much open source as possible, and as little as possible. In other words, be as open as possible, but make your stack small. Don't try to put too many pieces in it -- that makes it too complicated when you have different pieces of technology that all have to talk together. The Web site needs to talk to the server, which needs to talk to the database, and that to the fileserver. There's a lot of places for things to go wrong, so keep your stack short."

Varghese says the biggest benefit of building a business on open source is obvious. "The number one thing is the freeness. The bottom line equates to money, and free is zero, which equates to no cost. There are other things, though. Open source is built to be right, not built to be released. When OSS is not done right, it's not released. They put it in a branch and you can play around with it, but nobody is stupid enough to use a beta branch for production."


  • Open Source
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