The brains behind BitTorrent get on TV's good side (Q&A)

For years, Ashwin Navin ran BitTorrent, the peer-to-peer technology company that many people associate with pirated entertainment. Now he's flipped to the other side. He and a contingent of BitTorrent engineers are playing on the same team as television broadcasters at his current venture, Flingo.

Flingo is to video what Shazam is to music. They're both so-called "automatic content recognition," or ACR, software programs. Where Shazam can recognize a song simply by listening to it, Flingo can recognize actors who walk on screen during a TV broadcast -- and it can offer information and ways to interact related to them.

Flingo raised $8.5 million in its first round of venture capital backing, attracting the likes of billionaire Mark Cuban and August Capital, whose David Marquardt was the sole investor in Microsoft.

Navin, the co-founder and chief executive of Flingo, talked with CNET about what's changing (and what's not) in television, and how Flingo is approaching it differently than others in Silicon Valley. The following is an edited Q&A.

Q: Talk a little about your history and how that brought about Flingo.
Navin: I ran BitTorrent for four years, and most of Flingo's co-founders are engineers from BitTorrent. BitTorrent continues, and is doing better than ever, but we were intrigued by television. We were interested in figuring out how to use digital rights to make a TV service, but when cable operators saw smart TVs and consoles bring connectivity into the living room, the cost of digital content went sky high. We pivoted and got away from that quickly.

Some in Silicon Valley thought cable would die a quick death, but the buying power they have will keep them in business for another decade or two. We've pivoted to the opposite opinion, and now we're thinking of how to use the Internet to deliver the content but in a different way.

What is Flingo's technology?
Navin: Our tech sits within the televisions and in the phones and tablets themselves. Our software is ACR -- think of Shazam -- when you're trying to think of the name of the song, it will grab audio from the room. That, in industry jargon, is ACR: automatic content recognition. We fall into that group, as a company that makes ACR technologies. Basically, Flingo does the same thing but for video not audio.

What can Flingo do?
Navin: The most common thing is having instant access to cast and crew information. If you see an actress walk on a screen and can't remember her name, Flingo can recognize her and bring up information about her. That metadata lives either in a TV overlay that the user initiated or in a phone app or tablet app. It can do other things, too. The most natural extension of reality programming would be the ability to interact with viewers, such as voting with your TV remote for "American Idol" rather than with a phone. Other examples are the likes of a CNN or Fox News having the ability to take polls with TV remote. We've built up a bunch of building blocks for networks to use.

How can viewers use Flingo?
Navin: With a show, regardless of whether it comes from Netflix or Comcast, you're able to unlock clips or behind-the-scenes content, for example. You can do that in a tablet, but also we came up with a really simple interface for televisions themselves, where you get a Shazam-like icon in the corner of the screen that you can click on. For the creators, it doesn't matter how they choose to bring their content to market, the intelligence is in the device.

It's called Samba -- the underlying tech -- that synchronizes a Web browser, and it will become ubiquitous. Right now, it requires people to buy devices that have this technology in them. Last year, that population was nonexistent. It's small this year, but next year it will get bigger [The company is in talks with manufacturers to have its technology shipped in TVs later this year.] The software we've written over the history of our company is sitting in 30 million devices. We've always been focused on the TV devices or Blu-ray players, now we're turning our attention to phones and tablets.

What has been the response from the hardware makers and television companies?
Navin: The thing we get asked a lot from device manufacturers and from broadcasters is, "How does this make money?" The answer is that all the things that make content more engaging also apply to ads. So, for example, if you're watching a Volkswagen ad, maybe it piques your interest, maybe you can find the nearest dealership with the click of a remote. We're having those conversations now. In a world where Hopper is stripping the ads, this is very timely. TV ads will have to transform into something more personalized and multiscreen. And it leverages the fact that people are viewing broadcast content about 5 hours a day, if you believe Nielsen.

How does Flingo itself make money?
When we create an experience both on a television and on a second device, those are monetized with ads. We anticipated, and this is starting to get proven out now, those screens will be sponsored by a brand. A whole new category of programming is emerging that's synchronized with television. We're acting as execution of the commitments made by ad sales teams at networks.

If you add up all of Google's revenue, all of Yahoos' revenue, all of Facebook's revenue, it still doesn't even get you to half of the up-fronts every year for TV ad business. We would love to make that system more efficient and more engaging. Every startup's business plan is that if it can take X percent of television ad dollars, then it'll be a success. We said, "Hey, why don't we try to make the TV ad budget bigger rather than smaller?"

Some would look at your last venture and your current one and call it an about-face. Agree or disagree?
Navin: I don't know if it's an about-face, but what we do today is something BitTorrent could never do. We spend a lot of time developing the algorithms to know the shows, what they are, who is in them. BitTorrent has to be blind to the content and be only a delivery mechanism, to be in a safe legal position. At Flingo, we consciously try to learn what the content is.

What are some of the challenges in building up Flingo?
Navin: We spend a lot of time on 160 channels, ingesting all the video on these networks every day and inscribing metadata on them. It's a hard-core, heavy-duty engineering effort. We have four data centers across the country -- one in every time zone, and we'll continue to expand that. We'll be focused on the U.S. for the foreseeable future. Next on the roadmap is some European extension, probably next year.

When Google came to market, it basically had a massive investment in crawling the Web to index Web pages and pull out meta data to describe them. They had a really sophisticated algorithm to attach value to that meta data. We're trying to do a similar thing for TV content. That's a massive engineering effort. We've been a bootstrap company for most of our history, and when we wanted to deploy on that scale, that led us down the path of venture capital.

What makes Flingo different from other digital television ventures?
Navin: Most Silicon Valley companies, when they think about content, they want to be virtual cable operators. That is not a trivial undertaking and very few have succeeded in that. When they do, they have had some sort of unfair advantage. In the case of BitTorrent, it didn't have to pay for content. In the case of YouTube, users provided it. In the case of Hulu, it had the broadcasters attached. We're more interested in being like a GPS operator than the telco operator.

What is Flingo's focus at the moment?
Navin: First and foremost, it's working with app developers and manufacturers that use our tech -- that's the first milestone. Second, it's around usage, what people are doing with Flingo and how they're playing with the apps. We're focused on the first set of metrics now, and then, I'd say, it'll be the end of this year when we'll be attentive to the end user.

What about the future of television? How do you see it?
Navin: TV has to think about how to leverage people's existing behavior. We don't think that TV is ripe for revolution. We think it's ripe for transformation. The consumer, through a recession, has continued to pay for cable and satellite. Very few, even when budgets were tight, cut the cord. What we think is happening, and is quite interesting, is that the TV Everywhere battle was won by the cable companies and now the area where there is a lot of room for transformation is on the advertising side and on companion devices. Tens of millions are watching TV with another device. That's where we think the TV Everywhere battle will be fought next.