David Orman and Chris Gale see blockchain as a way to improve online video markets. This March, the two serial entrepreneurs with deep experience in the industry launched Verasity with two other co-founders. A 2017 study by the technology giant Cisco predicted that video traffic will account for 82 percent all internet traffic by 2021, rising from 73 percent in 2016. But even as the industry has mushroomed in recent years, it has struggled with issues related to consumer choice and compensation so “there’s friction between the creator, the publisher and the viewer,” Gale said.
Verasity has already raised $6 million in startup money and hopes to raise another $25 million via its ICO later this year. It is planning to launch its platform in 2019. “We’re excited about what we see in the next 12 months,” Orman told ThirtyK in a recent conversation.
ThirtyK: What are the origins of Verasity?
Orman: Technology specialists who have been involved in building businesses around video and ad tech came together earlier this year looking at video technology they had experience building. They found blockchain could solve many issues advertisers [and] content creators were facing. They found they could utilize blockchain to eradicate a lot of fake news, ad fraud and fake views. The start of the project was around proof of view, which is using blockchain to provide content owners and advertisers a truer reflection of viewing online, and in doing so creating a better viewing experience. The name Verasity comes from the word “truth.”
ThirtyK: What was the personal connection between blockchain and video?
Orman: I’ve worked as an employee, an adviser and investor in video projects. I was always looking for the next innovation to create better ways of distributing video content and to monetize that content. Chris was building a video technology business.
Verasity wants people to find content they want to watch and watch it in the way they want to watch it and only pay for what they value.
ThirtyK: Has video’s rising prominence figured in your thinking?
Orman: The world is moving to online video streaming, so absolutely (this is) the right space at the right time.
ThirtyK: More specifically, what issues will Verasity potentially address?
Gale: Users do not like watching advertising, and they do not want their data resold. What we’ve decided is to let the viewer choose and let the content creator have the flexibility to decide which monetization model works best. It could be a small donation to watch a small piece of content. It could be a pay-for-view or it could be a subscription-based model. So if I put content on a Verasity platform, using a Verasity player, the content creator can monetize the content effectively. For users, they can decide if they want to watch advertising.
Orman: You can run micro payments, two or three cents per video view. Users will be more receptive if you’re paying that rather than having to pay for an expensive monthly subscription to watch one piece of content. We want people to find content they want to watch and watch it in the way they want to watch it and pay for things they deem of value.
ThirtyK: Why is this process more in line with creators’ interests?
Orman: The content isn’t being gamified by algorithms that prevent you from being found on those platforms. If someone is watching, they’re paying you to watch that content. Using blockchain, you take out the intermediaries who are taking a slice of the pie. For somebody putting their content on another ad-funded platform, they might wait 60 to 90 days to be paid and lose 45 percent of their revenue. We’ll take a small transaction fee. You take the rest.
ThirtyK: What is that transaction fee?
Orman: It will be around 5 percent. The money will move from the person’s wallet inside the video player, and is transferred to the content owner’s wallet. The content owner can see how much revenue they’ve made daily.
ThirtyK: Via your cryptocurrency vera?
ThirtyK: Do you think blockchain-powered projects could lead to fundamental changes in video platforms?
Gale:. We’ve been approached by companies from small to big, from other online video platforms to broadcasters trying to find a way to leverage our technology, whether our video player or proof-of-view analytics, or our cryptocurrency to help power their platforms. Other companies may [eventually] license our technology.
More Control for the Viewer
ThirtyK: How will Verasity work?
Orman: We’re already speaking with content creators in the blockchain market who are not making enough money. They create their channel on the Verasity platform and content will be distributed through our video player technology with analytics so they’ll see how many views are happening. Then we’ll have our Verasity wallet that enables transactions from the person’s wallet to the content owner’s wallet. The advertisers come onto the platform further down the line. Advertisers on the platform pay users for watching ads.
Gale: The creator can see in real time how much value they’re generating in cryptocurrency. They can trade it for fiat [currency]. We’ve decoupled the advertiser from the publisher, and the advertiser’s relationship is [also] with the viewer. The viewer asks for the ad and decides how much data they want to share with the advertiser: The more data the viewer shares, the greater return in cryptocurrency.
ThirtyK: What content will appear on the platform?
Orman: Starting with cryptocurrency will give us testing, proving the concept. Soon after, eSports, gaming, and the long-term vision is [for] any content. You won’t need to be a cryptocurrency expert to trade on our platform.
ThirtyK: What is the timeline for Verasity?
Orman: We are hoping to launch the platform by the beginning of next year. The video uploading and distribution technology is fully operational. We have our first beta player. Blockchain technology is what we are focusing on now.
ThirtyK: What is the status of your funding?
Orman: We have seed funders, backers. We raised about $6 million worldwide. We will be launching our token sale, looking to raise $25 million by the end of the year. We are looking to talk to private investors who are interested in blockchain, media, and an experienced team and working product.
ThirtyK: Aren’t you asking video creators and users to change dramatically?
Orman: The market is growing at such a pace. Multitudes of people are involved in blockchain and cryptocurrency. New technologies are coming out to address real problems. We’re excited about what we see in the next 12 months.