Show time for new video compression

A secretive 4-year-old project aimed at improving digital video is ready for its close-up.

Privately held Pulsent on Monday will take the wraps off a new compression technique that the company claims can shrink digital video to about a fourth of the size of standard methods currently used in the cable and Internet industries.

The start-up joins a long list of rivals including Microsoft, RealNetworks, DivX Networks and others that hope to deliver broadcast quality programming over the Internet--the holy grail for nascent video-on-demand (VOD) services.

Pulsent not only promises eye-popping performance improvements. The company positions its technology as a major break from its rivals, offering a rare alternative to video standards developed in the past two decades under the auspices of the Moving Pictures Engineering Group (MPEG).

"Pulsent's opportunity is to be the compression of choice for on-demand services," said Gerry Kaufhold, principal analyst with Cahners In-Stat Group MDR. "They provide a better price-performance than MPEG."

The race for video compression comes as Hollywood studios begin to position themselves for the day consumers can call up programming over cable or computer networks at will. Last fall, Walt Disney and News Corp.'s 20th Century Fox studio announced plans to create a joint VOD service. That announcement followed a deal struck in mid-August among AOL Time Warner, Sony, Vivendi Universal, Viacom's MGM and Paramount to develop a similar service.

News source: Yahoo! News