Livepeer at Six Years Old
Research and idea generation for an open, token coordinated video infrastructure started in mid 2016, however it was January 4, 2017 that Eric Tang and I committed full time to R&D on what would become Livepeer. The date was marked by a rental of a small co-working space with two desks in downtown Manhattan. We have been grinding hard on building the world’s open video infrastructure, along with a great community and team ever since.
Six years is a long time in startup-years, and it’s an even longer time in crypto-years, where the market moves quickly from one trend to the next in bull and bear cycles, and attention span is at a minimum. We’ve always been mission focused, which has kept Livepeer even-keeled and building during both the ebullient phases of crypto excitement, and the troughs of negativity that inevitably occur inbetween. Said another way, the highs are not necessarily quite as high, but more importantly, the lows are not as low either, when you have steady progress towards your mission to fall back to.
As a project that has had a reasonable amount of longevity, relative to others, I wanted to share out some of the key reflections after six years in the fire of being an active contributor to a decentralized tech project.
Work to do
2022 has been a tough year for everyone building within the blockchain space. We’ve built through three different down market cycles, but this is the first one that has really captured the mainstream narrative in a way that stifles talent, capital, and demand side adoption of the space. As such, let’s start with a couple pessimistic reflections and get them out of the way, before moving on to more positive ones. These are areas where the community still has a lot of work to do in order for Livepeer to fulfill its potential.
Demand side contribution
Livepeer’s token-economic incentives have really shined on the supply side by incentivizing a great community of node operators who actively run the network and contribute improvements to the project. However, one of the hypothesis that hasn’t held up under real world conditions is that demand side users of the network — video developers — haven’t jumped to become owners in the network and active contributors to the demand side code and tools. Livepeer has some amazing open source video software, and the users of this software do actively contribute to testing, debugging, feature prioritization, and more in a helpful way. But starting out, we would have thought that they’d perhaps go a step beyond that — becoming stakeholders in the project through LPT, contributing back to the demand side tools and code in terms of features and other demand side product entrypoints, and thereby benefiting from the growth in the utility of the network.
Reflecting on this, one thing that the community could do is think about ways to more directly incentivize this type of behavior through the tokeneconomics. Via Livepeer’s open governance mechanism, inflation funding, and more, there are mechanisms to get LPT into the hands of the users of the network who engage in direct contribution to the ecosystem. This would likely result in a more diverse and robust network and software base, and a more diverse contribution group.
Decentralized Transcoding vs World’s Open Video Platform
Livepeer’s mission is to build the world’s open video infrastructure, but the starting point for the project and the Livepeer protocol was to incentivize and secure a decentralized compute network running software to specialize in video transcoding. Of course this software could do additional things in the video stack, and the network itself could add capabilities beyond just transcoding. While the network very early on in the Livepeer journey largely fulfilled the promise of reliable and cost effective decentralized transcoding network, the product/market reality is that despite these seemingly strong value propositions, all the market actors on the demand side needed a product a bit more comprehensive than simply transcoding alone.
Builders of social apps want video upload, storage, and playback. Livestreaming apps needed global ingest points and content delivery. The good news here is that the Livepeer Studio product wraps all of these capabilities together, while leveraging the Livepeer network for the transcoding workloads. The work that the community has ahead of them is to map some of these capabilities onto the Livepeer network itself, and to compose Livepeer with other decentralized technologies to bundle the full offerings that make it easy for developers to adopt. Keep in mind the mission, and move quickly towards a fully open video platform, rather than rely on transcoding alone to grow the project. In the long run, as there are more proof points at scale, it’s likely the transcode network could be plugged in to many large video platforms, though for now, much of the growth is coming from users who are looking for more end to end solutions.
Optimistic
With the challenges out of the way, let’s look at some of the reasons that make me most optimistic about the future of Livepeer.
Blockchain connected social and creator focused media is happening
When Livepeer would show up to decentralized tech hackathons in the earlier days of the project, 4 or 5 years ago, there would be zero teams there that would be conceptualizing rich media applications like social apps. Everyone was there to learn solidity, or to play around with concepts like issuing tokens, or maybe even bravely testing DeFi topics through projects like Maker. This trend continued while the infrastructure in the space was being built out, but I’m glad to observe first hand how much the tides have shifted in 2022, and how we’re primed to see breakout web3 social and creator focused apps in 2023. The growth of protocols like Lens, Farcaster, and DeSo has been one of the undeniable bright spots of a tough 2022 in the industry. The apps built on top of these platforms are becoming more mature as their user bases grow, and there’s a constant and growing stream of applications experimenting with Livepeer to power video upload and live streaming capabilities within this space.
We’ve been calling this group of apps Creator to Community (or C2C) apps, as they mostly follow a similar pattern of creators distributing content to their follower groups, and leveraging blockchain primitives like NFTs and token gating to implement access controls, shared ownership, loyalty, and more. Furthermore, the generative AI breakthroughs recently, have accelerated new creative media formats like generative images and video, and this will likely be paired with brand new C2C type engagement mechanisms that will be experimented with in the years to come.
Livepeer’s opportunity in this growing space is tremendous. Video is the most engaging, and infrastructure intensive form of media that is commonly consumed on the internet, and it’s inevitable that this class of apps shifts to be more video centric as the apps mature and user bases grow. While traditional video providers can certainly make video work in these platforms, Livepeer being blockchain connected, having blockchain-first features, being philosophically aligned, and bringing the value props around cost and infrastructure independence, set it up to be the leading video option in this space. I believe the next TikTok scale app will be blockchain connected, and it’s exciting for Livepeer to have the opportunity to be positioned to power it.
The Livepeer Community
As referenced a bit earlier in this post, and oft-repeated by me, the node operator community within Livepeer is the beating heart of the project. A large group of hobbyist and professional infrastructure operators from around the world work together, share information, help one another, and help the project, above and beyond what any singular centralized group could pull off with tremendous resources. They are bound together by a shared belief in the vision we’re all working towards, and a shared interest in having fun while building something together, guided by the cryptoeconomic incentives and values of the project and community.
This group has banned any discussion of speculation and token price within its hub, the community Discord, and passed that off into a telegram channel, and instead focuses on running and monitoring reliable infrastructure, creation of video mining pools, governance and incentives discussion, app testing and troubleshooting, and more. As long as Livepeer remains an exciting project for those looking to find purpose in an engaged community like this, the future is bright.
Open software and infrastructure independence
The largest cloud providers, Amazon and Google, happen to own the largest video social media platforms, Twitch and Youtube. Their compute clouds, AWS and GCP, happen to power many of the world’s largest video providers and services as well despite the fact that they offer their own competitive video services.
Call me crazy, but I don’t believe that the future of the open internet is looking very bright if a majority of the traffic and media consumed is all flowing through a couple AWS datacenters. You’ve seen time and again what happens when big tech is threatened by something disruptive, and moves to ban, deplatform, or make-illegal certain types of apps and content. The world needs open and independent infrastructures, and blockchain provides the right primitives for coordinating and bootstrapping these networks and the associated open software into existence.
If a developer is building an app that competes with Youtube or Twitch today, and it believes it has a better model for creators than what those apps offer, then it’s best not to be paying the majority of revenue that that app makes directly to Amazon for its AWS bill, while also risking that Amazon would deplatform them should they get too popular. Better to be building on open protocols and networks, and leveraging open software, that you can rely won’t be rugpulled from under you, should you be onto something disruptive that threatens the status quo.
As such, I’m optimistic on the belief that open wins over closed in the long run, and Livepeer, along with many other open infrastructure projects, represent a future base layer of the internet outside the corporate control of the world’s select few richest companies.
In Summary
It’s been an incredible first six years working hard on the Livepeer project, with a great community, team, and blockchain ecosystem of collaborators. There remains a long road ahead to fulfill the potential of being the world’s open video infrastructure, but with all of the momentum in the creator focused media space within blockchain and AI, I suspect that 2023 will be a year where we see some breakout use cases that define what’s needed of an open infrastructure network at scale. Looking forward to the next years to come!
