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Magicweb is offering a brand new technology that will
revolutionize the broadcasting industry, much like the way VOIP has transformed the
TV & Radio Broadcasting
5340 Bellaire Ave.
North Hollywood, CA 91607
Dr. Herbert Becker
Chairman, President and CEO
Interview conducted by:
Lynn Fosse, Senior Editor
December 15, 2005
Dr. Herbert Becker
President, CEO and Chairman of the Board
Herbert Becker has been involved with the evolution of IPTV since before it began, in
1995. He is the patent/copyright holder of BOIP (broadcasting over internet protocol).
Whos Who of the World, United States, Canada, Entertainment and Business, Nobel
Prize Laurels candidate.
Herbert Becker is an author, inventor and has been involved with public
companies at the capacity of President, CEO or Chairman of the Board for the
past 15 years.
The Core of Magicweb, Inc. (trading as MGWB)
Magicweb is the only company to offer B2B
IPTV with the propriety BOIP (broadcast over internet protocol) with its
EnterVision Broadcasting system.
Magicweb is a direct competitor to the satellite
broadcasting system currently in use with the television and radio industries.
The main objective is to become the premier source of television broadcast via IP to the
broadcasting industry. To promote and market the MagicWeb brand name as a substitute or as
a redundant service for the broadcasting industry. To become established as
the catalyst for defining the convergence of the Internet and Television, to take
full advantage of the Internet and the Digital Economy revolution.
To develop and launch the most comprehensive, completely interactive and
customizable television-related website as a backbone of our primary services of
broadcast delivery from the broadcaster to the distributor. And to promote and license the
MagicWeb broadcasting products.
CEOCFO: Dr. Becker, what was your vision when you started
Magicweb, and tell us where you are today?
Dr. Becker: I started Magicweb in 1995 and the vision
then was to be able to create Codex, which would allow for video to stream on the
Internet. Back in that, time the Internet was primarily text based. There wasnt much
happening on the Internet; very few images and certainly no audio and the idea of video
was a dream back then. As I moved forward we the technology, we were eventually successful
with Codex, and you could see a video streaming with companies like Real The Deal and
Quick Time. We continued the evolution until we had finally created in somewhere around
2000, a product called Broadcast Over the Internet Protocol, which was the next generation
up from streaming. As we moved forward, we eventually moved into the realm of pure
broadcast over IP (Internet Protocol), which is where we are now. Further, we never though
then where we would be now, but it is a very exciting space, because now we own a
technology and a space; its our own.
CEOCFO: What is Broadcast Over IP?
Dr. Becker: Broadcast Over IP (BOIP) is a patented
technology that allows audio and video to be broadcast from point-to-point, using Internet
protocol to transmit the MPEG to DVP compliance MCPC technology. What this does is let the
television broadcast migrate over the Internet.
CEOCFO: Why do we need that now?
Dr. Becker: Right now the largest users of MPEG2 are
for example, television stations such as ABC. When you go home and flip on your television
and watch ABC, but ABC is coming to you from a cable provider such as Adelphia
Communications Corporation (OTC: ADELQ) or Cox Communications Inc., network. They
ultimately get it via satellite from ABC and the cost of transmission from point A, which
in this case is ABC, to point B, the cable company, runs about $60 billion per year. It is
a tremendous cost and it is the single largest cost in the television industry; our
technology will bring that down to about one tenth of the price.
CEOCFO: How do you get potential customers to use it?
Dr. Becker: For the most part it is no-brainer. Up
until about 1940, television was transmitted via aerial; what that meant was that you
would go into your backyard and put up an antenna, plug into your television set and you
would get TV. Over the last 50 years that has gone from aerial to satellites. We now have
a technology that allows them to go back to the ground, which is using the IP and that
puts the technology right back in the hands of the broadcaster. Right now, the broadcaster
is subservient to the people who own the satellite, such as TelsatŪ Communications Ltd.
or GE (General Electric Company NYSE: GE), and the amount of business that they get
from the television stations is very small; Im told about 5% of the satellite
industry business comes from television. Therefore, it is a small wonder why back a few
years ago ABC lost their signal in the northeast, because they lost their satellite feed,
and they waited nearly a month before they could find out the satellite company who could
give them back their feed. That was a major loss, because every day they were losing
hundreds of millions of dollars and had they had our system that never would have
happened. They could have switched over to another band immediately, and never lost their
CEOCFO: So where does Magicweb fit in?
Dr. Becker: I think that we are going fit in as a
redundancy, where we will be the backup that they dont have right now, because no
one has a backup for their transmission. We will become that backup and as the years
progress, we will become the primary source for television and eventually radio, to
CEOCFO: Is the satellite industry fighting you on this?
Dr. Becker: Basically, the satellite industry is not
going to be hurt by this. They see for the most part that the broadcaster as being extra
revenue and maybe even a nuisance. They dont see them as a prime income-generating
customer. Further, that is really where the television industry has been hurting the most,
because ABC, CBS and NBC dont own their own satellites; they dont do their own
transmission. When see an interview on the street, or at the football game, you will
always see a truck, which is a satellite uplink truck. The have to have this and it is an
industry that depends on instant communication; our technology takes care of that. They
take the server and plug in their camera into it; that server goes into a T1 and now they
are connected. It is an incredible new sophistication, a new development, one of those
things that people say wow, it is so simple, why didnt I think of
CEOCFO: How do you get the industry to adapt your technology?
Dr. Becker: For ten years weve been in R&D
and for three of those ten years, we were working directly with and broadcasting outfits
such as NBC and the BBC. As they tried and experimented with the technology they found out
that they loved it, but we were dealing with technical people and not the decision makers
who write the checks. So where are we going to go? For the most part, it is a no-brainer.
When the financial guy looks at it and says $50 billion for satellites, $500 million for
IP thats what we call a no-brainer. He knows which way hes going to go.
Therefore, it is a matter of getting out in front of the end user and those Tier 1, Tier 2
and Tier 3 users, who are as ABC and CBSs Tier 1 regional stations, like a Chicago
or an state station would be Tier 2 and Tier 3 becomes Pay-Per-View and specialty
channels. There are an awful lot of customers out there for us, who once they get hold of
our technology they will love it.
CEOCFO: What should investors be looking for?
Dr. Becker: Right now the buzz has started, because it
is a brand new technology, a brand new field, and people are still trying to come to grips
with how we can do what we are doing. Up until now, when people think of the Internet, it
took a long time for them to understand what is Voice Over IP. Initially, Voice Over IP
was a guy sitting at his computer, plugged in a microphone and he was sort of able to talk
to somebody. Now that has evolved to where you buy a little device that you plug into your
wall, plug your telephone into it and you dont even know whether you are on Voice
Over IP, because it has now become ingrained in who we are. Broadcast Over IP will be the
same thing; the U.S., consumer will flip on their TV and you wont know whether what
you are watching is coming to you by satellite or by our technology. The ones who will
know will be the shareholders of Viacom International Inc. (NYSE: VIA.B) and all of the
big companies that own the broadcasts. They all see the difference, because their bottom
line is going to grow tremendously. Where we are now is that we have shifted from R&D
to sales and marketing. In order for us to be successful in what we are doing, we needed
to go public and we have. We need to raise the funds that are required for us to be able
to sale and market, and then be able to maintain our product line.
CEOCFO: Tell us about your management team. Do
you currently have the right people in place for the next phase for MagicWeb?
Dr. Becker: Along the way we have encountered a lot of
people who come out of industries like the television, the media industry, and those
people are now coming onboard to help us go with our sales and marketing. I know the
technology and my designers know the technology better than anybody and for us it is so
easy to be able to go out and explain what we are doing. Sometimes it does become
difficult for the layman to understand. When I talk about Q Band or QC Band or turnaround
service that means nothing to the consumer, but the guy who is the technology person at
broadcasters; well that means something to him. Once he embraces it, he can go to his boss
and say, here is where theses guys are, lets try it. It is not a
difficult sale and the people that we have in place, I think are the right people for
time. We are going to make this into a brand new industry, much like the VOIP became a new
industry, BOIP will be a new industry, because right now we are the only ones in this
CEOCFO: Thats a good place to be.
Dr. Becker: Its a good place and a bad place. The
good thing is that we are the first guys out there, the new kid on the block, but BOIP
doesnt mean anything to anyone, because nobody knows what it is. Now its bad,
because we are the only guys there and there is no one to compare us with; no one to even
compete with. Having no competition however, means that there is also no one else helping
to sound the trumpet of BOIP, but it is going to come. It will probably come over the next
few years, but right now we own this space and we love it.
CEOCFO: What is the revenue model; is it licensing or sale of
Dr. Becker: Right now, we are really moving along the
same revenue model as satellite companies. If you drive past CBS of CNN, you will see what
we call a satellite farm, which is a large space filled with satellite dishes. We will do
the same sort of thing, but our cluster will be a server. We will go into the
broadcasters, hook them up to the servers, the servers are hooked up to the Internet and
those Internet connections go to receivers, which are the cable companies. What we will do
is simple; we do not believe that we will be selling the equipment, so following what
satellite companies have done we will be leasing the equipment. We will maintain the
equipment, train the users at both ends on how to use the equipment and have our S.W.A.T
teams in place just like the satellite companies do. If something goes down we will be
there to repair it, so the model is an ongoing contract with the broadcasters.
CEOCFO: What is the financial picture like at Magicweb today?
Dr. Becker: We have been public for a month and in that
month we opened at 20 cents and as I checked this morning we were trading at $2.00, which
shows me that there is a lot of interest in what we are doing. A little company
doesnt go from 20 cents to $2.00, simply based upon their great idea, and since we
have, this shows great support for which we are. We are looking to raise between 5 and $10
million in order to get us through the first stage, which is getting the word out, getting
the marketing machine running, talking to the media and getting those first few systems
into place at the broadcasters. Further, that is where we are at now.
CEOCFO: In closing, please address potential investors, why
should they be interested and what is most often overlooked about Magicweb?
Dr. Becker: What they miss is that we are not a dot
com, we are not an Internet company, and we are not selling a technology that allows
grandma to see her grandson on the Internet. The only thing that we have to do with the
Internet is that we happen to travel over the same IP as AOL.com does. That is it; we have
nothing to do beyond that and that is where the confusion is with the company. We get
calls all day long from people, investors, reporters, you name it; saying that is
great, now can I see an example. I tell them to go turn on CBS in Los Angeles and
there you go. Now they dont get it and they will then ask us for an example on their
computer, but we dont have anything to do with their computer and that is where
people dont get it. They believe that so much of what is happening today, if it has
the word IP, it has to do with the Internet and we dont. We are strictly a broadcast
device, a transmission system for broadcasters and thats who we are. Broadcast Over
IP is a technology that allows broadcasters such as television and radio broadcaster to
transmit the signal from where they are to the cable and other distributors, so that it
reaches the consumer in their home, on the radio or on the television.
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