IQ Interactive Special Report – Flash Forward

For many advertisers and content creators, Macromedia’s Flash has brought rich media to a narrowband world.
If Macromedia Flash were a human rather than a virtual celebrity, it might be a good subject for a biopic. The animation and rich-media content software has risen from inauspicious beginnings in 1995 as the little-known FutureSplash to its acquisition in 1997 by San Francisco-based Macromedia. Its developer tools repackaged as Macromedia Flash, it has been a driving force behind the Web’s shift from a text-based medium comprising “pages” to an increasingly animated medium whose content–whether text or images–moves, transforms and interacts with the user. The Flash plug-in (which Macromedia calls a “player”) has become the most downloaded application on the Web, according to analysts, and the implications for advertisers are great.
For interactive agencies and site developers, Macromedia Flash is the rich-media tool of choice because it can play on nearly any device, and the incredible popularity of the Flash player means most end-users can view Flash content. Also, since Flash content is vector-based, it doesn’t require broadband connectivity to work.
“It’s our opinion that Flash is not just another Web development tool but, as of now, has become a new standard for online content,” says Eric Kavanagh, senior vice president of New York-based, an interactive production studio specializing in rich-media content. Allie Shaw, vice president of global marketing for San Francisco-based Unicast, says that at least 90 percent of Superstitials contain Flash content. Superstitials, developed by Unicast, are a “souped-up” class of interstitial that downloads content in the background and launches immediately.
“We have benefitted from the growth of Flash, but, in many ways, we have helped agency penetration and end-user experience of Flash,” says Shaw.
Judging from free Flash-player downloads over the past year and a half, most end-users are equipped to have that experience. A graph of month-to-month free Flash player downloads since January 1999 might look like a hockey stick built for Wilt Chamberlain. Statistics culled by Macromedia indicate that monthly Flash player downloads nearly tripled from 11.8 million in January 1999 to over 30 million downloads by January 2000. Flash player downloads shot over 50 million in May.
“We are the most distributed piece of software on the Web,” claims Eric Wittman, senior product manager for Flash. “We get, on average, 1.7 million downloads of the Macromedia Flash player per day.”
In March 2000, Port Washington, N.Y.-based consultancy NPD’s New Media Services relaunched an online market research study to determine what percentage of the Internet population could see various graphic and animation formats on the Web. Results of the study indicated that 90 percent–or 222 million users–could view Flash media. By contrast, 85.2 percent could view Java; 55.8 percent, PDF; about 53 percent Real Player; 52 percent, Shockwave; and 32.5 percent, QuickTime.
With the release of Flash 4 in June last year, Macromedia expanded Flash’s purview to include site development. Flash 4, says Wittman, gives developers the capabilities to build not only animation on a site, but build the entire site itself, since it allows developers to create navigational menu systems and database-driven applications and to import graphics built with Java, Perl or other authoring languages. “Now the experience is way more compelling,” he says. “Instead of just being broadcast to a user, a user is interacting with Flash.”
Version 4’s authoring tool also allows developers to use MP3 format to compress Flash audio and add an interface layer to QuickTime 4 movies.
“Flash 4 is an entire authoring environment,” notes’s Kavanagh, pointing to the ability to import other graphics. “They almost should have changed the name. It sounds like an upgrade, but it’s really a whole new ball of wax.” relies heavily on Flash 3 and 4 for its Webmercials–the online counterpart to TV commercials–which present full-screen, high-impact animation and graphics combined with professional audio effects and interactivity. KMGI has made Webmercials for such companies as DuPont and CyBuy, and has also done full-blown rich-media Web sites in Flash 4 for companies such as Best Western and Macromedia itself, according to Kavanagh.
He explains that after was founded in June, 1998, the company stumbled on Flash late that year, and spent several months of research and development to master the software and find a way to deliver full-screen animation complete with voice over and sound with no download time. “That was our prime directive,” he says. “Web surfers don’t wait.”
The company’s homepage is created exclusively in Flash with no HTML pages whatsoever and showcases KMGI’s products, such as its Webmercial and Web Presentation format. According to a company rep, KMGI uses Flash for approximately 75 percent of its interactive production.
Megan Kirkwood, PR manager for Macromedia Director and Freehand, tools for creating rich-media content within Web sites, points out that the agencies that created sites for Coke (, Tiffany ( and Volkswagen ( designed the sites entirely in Flash 4. Other Flash 4-based Web sites include Citibank ( and Lexus ( “Most entertainment companies build their sites in Flash now, as well,” she claims. As part of its online campaign to showcase the new Lexus IS 300 automobile, Lexus features a Shockwave-based interactive event called “The Sufficiently Radical” contest, at The contest allows site visitors to create a 30-second Lexus commercial by turning their Web browsers into a fully operational edit bay, where users can assemble a Lexus commercial by selecting from 67 video clips, stills and musical soundtracks.
Advertisers vying for novel ways to generate customer interest and clickthroughs via banners may be heartened by astonishing clickthrough rates claimed by advertisers using Flash-powered banners. A rich-media study conducted by Wired Digital in partnership with Chicago-based Millward Brown Interactive and released in January 1999 revealed that Novell’s Flash-enabled banner ad for Netware 5 experienced a 32 percent increase in brand perception and a 430 percent increase in user clickthrough.
Eric Schmitt, an analyst with Cambridge, Mass.-based consultancy Forrester Research predicts that two years from now more than 95 percent of Web surfers will be able to view Flash, and fully half of the top tier e-commerce sites will use the technology as well. He also predicts that, as companies’ dependence on Flash grows, Macromedia will feel pressured to replace its scalable vector graphics format as an open standard.
“The company will accede to this pressure,” Schmitt says, “submit the standard to the W3C [World Wide Web Consortium], and focus on maintaining its lead in vector-graphics authoring tools.”
Wittman says Flash’s narrow-band capability will allow Macromedia to benefit from the enormous market growth predicted for wireless devices, which, according to Framingham, Mass.-based IDC, will outsell desktop PCs by 2005. “The whole Web appliance and wireless space is a very exciting landscape right now, and two things give us an edge,” he says. “First, Flash player is small and lightweight, about 200k compressed. No other player comes close to that. For hand-held devices portability is critical.
“Secondly, Flash content on the Web is fine tuned for the slow modem speeds because the technology is highly efficient and optimized for low bandwidth, so the experience for consumers will be exceptional.”
It may be a testament to the company’s success that Macromedia makes money the old-fashioned (some would say obsolete), shrink-wrapped way: The Flash authoring tool goes for about $299; it’s $120 to upgrade to version 4.