Video chat service startup Tokbox: where’s the value?

The New York Times reports today about a video chat service startup that operates without any mandatory downloads or installations, named TokBox. Tokbox will also offer its users the possibility to store and send video messages, and the article rightly points out the many similarities the startup has with YouTube.

It is partly funded by the same investor, Sequoia Capital, and Jawed Karim, a YouTube co-founder who left the video sharing site early on, is backing the company financially and sits on its board. But at 77, we’re not too sure that TokBox will be the same huge success as industry giant YouTube.

For one thing, as New York Times points out, people might demand higher quality for video conferences then they do for skating dog videos – especially when they might eventually pay a subscription fee – and this higher quality could be hard to maintain with regard to server space and bandwidth. But the real problem, in my opinion, is the relative lack of need for the services that TokBox might provide. Not everyone prefers to see the people they talk with all the time, especially if they need to pay for it. The other option for TokBox of monetizing their product would be, of course, advertising, but placing video ads in conferences is more intrusive and disturbing than placing them in video content.

In a quick office poll that might be slightly unreliable (n = 15) we found that only 27 percent of young university graduates would prefer the use of video over a normal phone conversation when they deal with (potential) clients, and about fifty percent would prefer to use video in informal conversations with colleagues or friends. Regardless of these results, we see more added value in YouTube videos over streaming sound files, than in video conversations over phone conversations.

In short: as marketers, this online service is not something we would immediately jump on. For now, we would prefer YouTube advertisements.

This entry was posted on Tuesday, October 16th, 2007 at 12:42 am and is filed under Other Marketing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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