Beamr - compression and encoding - online video startups - Fierce 15 2015

Where it's based: Tel Aviv / Sunnyvale, Calif.
When it was founded: 2009

Why it's Fierce: Since announcing its data compression product in late 2013 at the IBC tradeshow in Amsterdam, Beamr has steadily been working its way into the content delivery streams of large-scale Internet players from photo storage providers to a number of major online video providers including Netflix.

"Our endgame always has been optimizing the network," Mark Donnigan, VP of sales and strategy at Beamr, told FierceOnlineVideo.

Beamr said that its compression algorithm can reduce the size of files by as much as 50 percent. Of course, that can have a huge impact on any type of data that needs to be either stored or transported. But as OTT providers begin to eye the predicted bandwidth requirements for online video--it may take up 80 percent of all Internet bandwidth by 2019, according to Cisco--interest in effective data compression has climbed.

Donnigan said that sales of the company's products--which include a compression service for digital photos, its original product--tripled between late 2013 and 2014, and that it's on track to double its sales again. "We're an annually renewed license. We have a 100 percent renewal rate" from customers, he said, which range from consumers to about 100 enterprise customers.

Of those enterprises, about 90 license its compression product for digital photos--including a top photo sharing service--and 10 are video compression customers, all of which are large enterprises and include Netflix and Groupon, among others.

The provider scored a $9.5 million venture round in 2014, which included investors like Marker LLC and Google's Erik Schmidt.

Israeli technology entrepreneur Sharon Carmel founded the company and is its CEO. Working with Dror Gill, currently CTO of Beamr, the team filed for more than 60 patents during the development process. As of mid-June, five patents have been granted, giving Beamr a valuable IP base to work with.

What's next:  Beamr is aiming squarely at the video market, offering its services for everything from Blu-ray compression to 4K streaming and points in between. The company is preparing to announce some deals with companies in those market segments, including Warner Bros. / GDMX and an unnamed MVPD that Donnigan said they have been working with for 18 months.

But, Blu-ray? Isn't that a nearly dead medium? And can Beamr possibly make money from the format?

Blu-ray is still the media of choice by movie production companies looking to distribute their content in the richest format possible. It's "the one standard that studios won't compromise on," Donnigan said. And while studios may only put out one or two new Blu-ray releases per month, Beamr isn't losing money on the deal. "We're going to make back in licensing fees what we invested in the product," Donnigan said. But its work with Blu-ray will have its best return when the company is acquiring new video compression customers. "The payoff is that once anybody who approaches me asks [for a] quality test, I can just hand them a [Blu-ray] title. We can immediately remove any [doubts]."

Beamr - compression and encoding - online video startups - Fierce 15 2015