DivX creator goes to Hollywood

But the once-underground creator of DivX joined his colleagues this week here at the Westin Bonaventure Hotel to launch DivX 5.0, compression technology that promises to be to video what MP3 is to music.

Granted, Gej stood out from the buttoned-down Hollywood types with his ponytail, geek glasses and black jeans. The 28-year-old technologist gave only a shy wave and shrug to the crowd when he was introduced during the formal presentation, letting the executives from DivXNetworks do most of the talking.

Later, as engineers scurried around him, breaking down the technological props used to demonstrate DivX, Gej acknowledged the wow factor. "This is hard to believe," he said about the popularity of the software, which attracted more than 1 million downloads in the first 48 hours of the release of DivX 5.0. "It's grown all by itself."

Gej has become something of a cult hero in the two-and-a-half years since he created DivX--especially among people looking to pirate movies. DivX compresses unwieldy video clips into small files so they can be easily transferred over the Web. The name itself (originally spelled "DivX;-)") is a sly poke at early failed efforts by the movie studios to market copy-proof versions of videos, also known as Divx.

Now, Gej and his company are trying to move from being Hollywood's worst nightmare to being its best friend, joining companies including Microsoft and RealNetworks, which are racing to develop a standard for delivering video over the Web.

The company's efforts have put it at odds with its early, devoted followers. Purists and pirates are criticizing DivX's attempts to go mainstream--especially its decision to charge $30 for a professional version of the technology and its alliance with controversial pop-up ad provider Gator. A visitor to the DivX site is bombarded with as many as four annoying pop-up windows.

The folks at DivX realize they're walking a fine line, both between the pirates and the movie studios, and between pressures to appease geeks and make money. But at least they have a sense of humor about it.

The company's Mad magazine-esque home page contains a poll asking for opinions about the new software. Choices range from "It's great! I love it more than my own mother," to "You are all corporate sellout bastards. I will hunt you down and make you pay."

Staying alive
Analysts say DivX's story is a familiar one in the tech business: A programmer perfects an existing technology, gains a popular underground following, and then teams with a business-savvy partner to start a company.

"The question is, what becomes of these companies?" asked Ben Sawyer, co-founder of emerging-technology consulting firm Digitalmill.

Sawyer, who says he likes DivXNetworks' technology, noted that the company faces several market challenges, including running afoul of Microsoft, competing with industry giants such as RealNetworks, and getting the attention of movie studios. He said the company could get bought or just run out of steam.

"You could stake out a bunch of scenarios and pray the good ones come true, but you just can't tell in the volatile video market," Sawyer said. "I find it very hard to believe there will be this company called DivX 10 years from now."

Like many popular technologies that take on a life of their own, DivX was developed to solve a particular problem faced by its creator. Gej's journey from Montpellier, France, where he first created the software, to San Diego-based DivXNetworks began in 1999. Then a video engineer, Gej wanted to compile a portfolio of his work, but he couldn't find a way to compress it and transmit it in the popular AVI (Audio Video Interleaved) file format.

So he tinkered with a Microsoft program to make it AVI-compatible and sent the technology to one friend via an IRC (Internet Relay Chat) room. Soon he was deluged with tens of thousands of requests.

"The popularity of the first DivX showed there was a need for something like this." Gej said. "The goal is to have high-quality video. This is just a way to deliver it."

Programming ghost
DivXNetworks co-founder and CEO Jordan Greenhall said he had a heck of a time tracking down the mysterious Gej after learning about DivX from friends at the online hacker magazine 2600 and using the software to download a copy of "The Matrix."

"Nobody knew whether he was real," Greenhall said.

After a three-month search, Greenhall finally found the enigmatic programmer, but not before jumping through hoops to prove his trustworthiness to the underground Dutch hacker group that eventually put him in touch with Gej.

After several months of messaging, Greenhall convinced Gej to help him start a company based on the technology, characterizing Gej's acceptance of the offer as "Sure, but can I wear leather pants?"

Greenhall acknowledges that pirates and crackers have been the driving force behind the software's popularity so far.

Now, however, DivX is striving to go legit. The company has struck a deal with chipmaker Advanced Micro Devices to include the technology in upcoming chips. And throughout much of Monday's presentation, Greenhall touted DivX 5.0's digital rights management, or DRM, technology, which he said would protect movies from being bootlegged.

In a departure from its underground ways, Greenhall said the company is working closely with movie companies. "DRM for us is driven by the studios," he said. "Ultimately, it is their decision."

Gej said the addition of more strict security technology doesn't bother him. "The need for DRM is really, really strong," he said. "As a content creator myself, I know that."