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Use of streaming media; audio and video content delivered over an Internet Protocol (IP)-based network, was not as ubiquitous as e-mail, but was rapidly increasing. Workplace usage of streaming media hit 22 million users in October and November of 2001, increasing 11.3 per cent over the same period in the previous year. The users of streaming media were diverse. Enterprises used audio and video to jazz up their public-facing websites to improve the quality of on-line customer service, and to cut the costs of running a parallel closed-circuit television network for corporate communications and distance learning. Media and entertainment companies were aggressively pursuing the Internet as a distribution channel for movie trailers, and as an advertising channel to spur CD and DVD sales, and as a new revenue stream with pay-per-view delivery of entire films directly to a user's computer. Despite the best efforts of technology and service providers, TN-quality streaming, and the business models that depended on it, streaming media still faced several hurdles. This technical note provides a high-level background on the challenges involved in delivering audio and video content over the Internet in 2001. It then gives an overview of various technical solutions that have been developed to address those challenges. It concludes with a discussion of the six critical areas that organizations must consider if they plan to include audio and video components in their business applications. This is a supplement to Mercedes-Benz USA: Investing in IT Infrastructure, product 9B06E003.

The national manager for technical training at Mercedes-Benz USA, is considering using streaming media and distance learning as a supplement to class-room based education, but is concerned that this innovative and risky IT investment could have a negative affect on the company's quality reputation. He needs to evaluate the viability of the e-learning option, including selecting between two vendors, Microsoft and Real Networks. This case provides students with an opportunity to develop a methodology based on capital budgeting analysis for evaluating and executing IT investments. The case is particularly valuable for helping students to consider the risks related to the execution of IT investments, even when an investment has a high ROI. Supplement material, Implications of Streaming Media: A Technical Note, product 9B06E002 is available.

The national manager for technical training at Mercedes-Benz USA is considering using streaming media and distance learning as a supplement to classroom-based education, but is concerned that this innovative and risky IT investment could have a negative affect on the company's quality reputation. He needs to evaluate the viability of the e-learning option, including selecting between two vendors, Microsoft and Real Networks.

Financial spreadsheet for instructor.

PowerPoint slides for product 9B06E003.

Financial spreadsheet for students.