VentureBeat

We can all watch live video broadcasts on the internet thanks to content delivery networks (CDNs), which set up strategic points online where they can send streams of videos to internet users as efficiently as possible without clogging up the entire web.

But Andolis, a San Francisco startup with French roots, hopes to disrupt that business with a product called DaCast. It uses technology that can do the same thing as CDNs much more efficiently and inexpensively. Stephane Roulland, chief executive of Andolis (pictured here), said that the company is capitalizing on peer-to-peer technology to share videos. Dacast and an invitation-only “alpha” version of it will soon be available at Dacast.com.

Live multicasting today requires a private network where companies such as AT&T broadcast live video to consumers over its U-Verse IPTV video service. But such technologies don’t work well on the live internet, where delays in moving video pretty much wreck the service quality.

Roulland said that his company has created a working peer-to-peer multicasting system that can broadcast live streaming video to anyone on the internet using very little bandwidth. It can receive incoming video of any format but distributes video using only the H.264 video protocol.

It works by finding a “tree” of friends that you can share a video connection with. You can share a video with one person directly and another person as a backup. Both of those friends share it with two of their friends, building a tree of connected friends until everyone can access the video. If one friend disconnects or has a choppy connection, the software automatically seeks out the backup. Roulland says the result is reliable, live streaming of video.

The company has just six employees and licensed the technology from a U.S. university (which Roulland won’t name). Roulland, a serial entrepreneur who has worked in streaming video companies for almost a decade, financed the startup and is now looking for a first round of capital. He previously ran LOFTV SA, a series of entertainment web sites. The company was sold in late 2005 to French CDN Ipercast.

Roulland said he’s in discussions with content delivery networks (such as Akamai) for possible partnerships. CDNs have networks that are more expensive because they involve centralized servers for distributing the video. DaCast’s beta version will be available in August on Windows XP and Windows Vista. Mac and Linux versions will come later.

The company has integrated an ad tool into its software to allow it to push video ads onto the network. Hence, Roulland hopes to make money on DaCast through advertising. He may also license the service to other companies.

One CDN player I spoke to said he is skeptical of peer-to-peer content delivery and will believe it when he sees it. Competitors of Andolis include makers of mesh networks, such as Rawflow, Abacast, Octoshape, Rinera Networks, and Gridnetworks. But Roulland said that those companies have significant delays and don’t save as much on bandwidth costs as his technology.

Here’s the latest action:

File-sharing company Pando Networks raising $20.9M — Pando Networks, a New York file-sharing company that uses P2P software to allow users to download, stream and share large media files quickly, has raised $8.1 million of a targeted $20.9 million round of capital, VentureBeat has learned. The company has gotten positive press coverage for its ability to send very large files, such as high-def video. The round is includes backers Wheatley Partners and BRM Capital Fund. (Our early coverage of Pando.)

Federal Communications Commission weighs action against Comcast — The FCC said Comcast may have violated Net Neutrality principles, after it acknowledged t was slowing down traffic for peer-to-peer file-sharing sites. It is unclear what, if any, penalty the FCC can impose.

Cisco backs hi-definition streaming video company GridNetworks –Cisco participated in the Seattle company’s $9.5 million first round, part of the giant San Jose company’s effort to move into digital media to grow traffic on its infrastructure. GridNetworks competes against other content delivery networks, such as Akamai or Limelight, using a peer-to-peer client. We covered the company here.

Online advertising company Adjug gets backing from Tomorrow Focus — Adjug, the London based ad marketplace, lets advertisers determine where on a Web page they can place an ad, and decide what price they will pay to the publishers (announcement of the strategic investment is here ).

Softcoin, Web-based promotions company, raises $200,000 more — The Silicon Valley company offers promotion and loyalty programs online in the form of coupons. Customers get to redeem them in a store. The Brisbane, Calif. company has now raised $2.2 million in a third round of funding, which came from RRE Ventures, Greylock Partners and others, according to VentureWire.

Wireless car technology gets adopted by Ford – Airbiquity lets a driver’s cellphone deliver location and diagnostic data about their vehicle. The Seattle company has just landed a customer in Ford. See our recent coverage of Airbiquity and its financing here.

Walt Disney Co. expects $1 billion in revenue from online content this fiscal year — That’s a major increase from last year, according to CEO Robert Iger.

GridNetworks, a start-up from Seattle that is offering a new video streaming technology, has launched — and wants to steal some of the Venice Project’s thunder.

We downloaded the Grid player software, and are impressed. Check out this example of Little Miss Sunshine (you’ll have to download their software).

It aims to compete with the upcoming Venice Project, which is the company started by the Skype co-founders. Venice is supposed to launch in New York at the Television conference Thurs. or Friday. Venice Project is a peer-to-peer technology (hosted on a network of individual computers) for television viewing as simply as they did peer-to-peer for phones.

GridNetwork, for its part, says its video delivery platform delivers full-screen, DVD-quality video in a format that is better than the other guys out there. It may depend on what side of the table you’re sitting on, though. Grid says it will give media publishers full control, which we’ll explain below, to create their own version of YouTube. The Venice Project, while not out yet, but based on the reports dribbling out, puts more power in the hands of consumers, giving them their own version of YouTube, but for better quality videos.

Grid is a hybrid of peer-to-peer and content delivery network (CDN) technology — taking the best of both. Peer-to-peer is cheap but open to copyright abuse. GridNetworks uses computer nodes (peers) in the network, but places each of them in a distribution grid that delivers encrypted video via a centralized platform that allows it to keep the system legal. By using P2P, it avoids the cost of traditional CDN hardware.

The company has raised an angel round, and is run by an accomplished team led by Jeff Payne, who founded Real Broadcast Network in the mid-1990s. The team has the advantage of watching the likes of other delivery companies such as Kontiki, BitTorrent and Redswoosh (which has a similar hybrid CDN/P2P model), and have built in new technology to make delivery even smoother, Payne said. Grid has created a “Media Vault” feature that allows media companies to control their content delivery. It has built in redundant nodes, and compression technology, and supports both Flash and Windows Media players

It delivers a 1.2GB movie at a cost of 25 to 50 cents, which is pretty cheap.

Here is its statement on technology.