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So, really the Sling Entertainment Group is about creating experiences that are tied to, but are also out of the Slingbox, with destinations and revenue models around that. And also, courting the media industry, which we obviously have a relationship with, and try to explain this word “disruption”, which is used as a [negative] term. But, what disruption is all about is that current models are broken, and companies like ours are re-inventing them. That doesn’t mean that’s bad for the traditional companies that are in this space that are booing our product. From a distribution perspective, a company like a Comcast or Time Warner should love Slingbox technology, because it allows people to watch their signal in a place they wouldn’t normally be watching, and there must be some sort of revenue opportunity there. From a programming standpoint, it allows you to be watching television where you wouldn’t normally be, and therefore there are ratings and ad sales and all sorts of things.

With Clip+Sling, it will allow the audience to create and cut up your content so the media company has no deliverable. But on top of that, it will allow the audience to truly evangelize your programming, distribute it, and also give you a revenue opportunity to sell video ads and advertising around it. It’s one of these times, and I’m sure you heard about the CBS deal, where a media company said, “You know what. These guys are cool. It’s being done anyway. Why are we trying to put the genie back in the bottle? We can’t do that. The record business tried and it was a failure. Let’s try to embrace these guys and see if we can create some new technology and a new business model.”

And that’s what I’m in charge of.

MW: In your own words, how do you expect this to change the experience for Slingbox owners?

JH: We’re really going to augment and improve it. Let’s say, for numbers sake with something that’s easy to add up, there were five hundred thousand Slingboxes in the marketplace. And let’s say, since Slingbox owners tend to update their software very often, the next version has Clip+Sling functionality. All of a sudden, my sister was watching Battlestar Galactica, the Boise State Game, or Heroes, and she sees something that she loves. In the past you’d watch the scene and you’d talk about it at work, or search the Internet in hopes of finding it. Or, try to pull it off your television on your own with a tuner card, encoding software, and then upload and download it. This allows you, in under a minute with one fell swoop, to digitize, upload, and pass around to your friends, a clip that expresses something about yourself and also evangelizes a show that you love.

In American culture, like many other cultures, the love for media is driving conversation and community, so this is a great enhancement for Slingbox users. What it also means is that the Slingbox users, if this thing really takes off, become the seeders of television content on the Internet. If you had 500,000 Slingbox users out there, and let’s say only 5% of them used Clip+Sling, and let’s also say that they were doing two clips a day, it would mean twenty five thousand people doing two clips a day. This would mean 50,000 TV clips every single day to the Internet. That’s a phenomena… even YouTube only does 75,000 or 80,000 clips per day, and they’re huge.

So all of a sudden the Slingbox owners, while there definitely needs to be a lot of them to use the product, become the ones that are the catalyst for a community on the Internet around television. They’re the ones that are the pacemakers. They’re the ones that are passing content around and introducing people to new TV shows. It’s also rightfully so, because they’re the ones that really love TV more than anyone else.

MW: You mentioned YouTube, and it’s pretty difficult not to draw some comparisons between Clip+Sling and YouTube. Both communities allow you to upload and share short segments of content, self created or otherwise, with other people. One of the things that’s made YouTube so popular is the ability for anyone to pull a video and show it on another site. Is Clip+Sling going to allow this?

JH: Clip+Sling is really just a functionality to take the clip, it’s the video portal that we’re building out that will have all that functionality. So while there’s a showcase at the portal we’re building, we don’t care where the video is shown, so you’ll be able to watch it at several places. You’ll be able to watch it in your SlingPlayer software, on the open portal, or through the embedded player on your own site or other places. All the clips that get uploaded to our site will probably likely get uploaded to the content owners’ site as well. So imagine if we did a deal with a television network, they’re going to want all the clips as well that the users are clipping up. They’re going to embrace this technology and the audience that’s doing it. --continued on page 3--