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Search: The next big thing in online video

Trying to find a video on the Web can often be a challenge. The big search engines, Google (GOOG), Yahoo! (YHOO) and Microsoft’s (MSFT) MSN aren’t nearly as good as locating relevant video files as they are with text.

So not surprisingly, several companies have emerged that are trying to gain a foothold in what could become a lucrative business as broadband video grows in popularity thanks to sites like Google’s YouTube.

One company, Blinkx, has even cashed in on this trend by going public last month on the London Stock Exchange’s Alternative Investment Market. The company, which operates a video search engine, saw its shares run up 40 percent in their first day of trading but the stock has dipped by about 25 percent since then.

Suranga Chandratillake, the founder and CEO of Blinkx, said the company sees room to compete against the big search firms because of Blinkx’s focus on just video. To that end, Blinkx powers the video search function on IAC’s (IAC) Ask.com and Chandratillake hinted at several new partnerships that will be announced shortly with other public companies.

Chandratillake added that Blinkx, which is actually based in San Francisco, decided to go public in London since it was more cost-effective and efficient to do so than on the Nasdaq, and said that the company plans to use its proceeds to bulk up its advertising sales force. He said that his company’s goal is to feature online video ads that are pertinent and not obtrusive so that it increases the likelihood that people will actually click on them, as opposed to say, annoying banner ads or pop-ups.

“We want to include targeted advertising in videos. If an ad is relevant, you can be subtle. The reason why banner ads are obnoxious is because they have to grab your attention somehow,” Chandratillake said.

So can Blinkx use its new status as a public company to gain ground against larger search firms and distance itself from smaller upstarts? That remains to be seen. In addition to the big search engines, AOL, which is also owned by my parent company Time Warner (TWX), has established a foothold in video search through its acquisition of Truveo last year. TV Guide online, owned by Gemstar-TV Guide International (GMST) is also testing a video search tool for a formal launch this fall.

Blinkx may be the first pure play online video firm to tap the public markets but there is still plenty of competition in this burgeoning field.

Privately held EveryZing, a search firm focusing on both audio and video files, unveiled its updated search site this week and also announced a new round of venture capital financing. The company, previously known as PodZinger, raised$10 million from top VC firms Accel Partneres, Fairhaven Capital and General Catalyst.

One feature on the EveryZing site that makes it interesting is a search function that makes it easy to search for relevant videos specifically on YouTube. That could help EveryZing stand out.

“Multimedia is not easily found in search engines. The best they can do is index the title and some text tags,” said Tom Wilde, the CEO of EveryZing. “Search and discovery in YouTube is frustrating to people.”

But Blinkx and EveryZing will face a lot of competition. A company called Clipblast! rolled out an enhanced version of its video search toolbar Wednesday with a real-time ticker feature that lets users check out videos that have just been uploaded on the Web.

Video search won’t necessarily just be about search either. There are also some companies using social networking and sharing features to make it easier for people to find videos they want. And they will also play an important role in video search.

To that end, software company ChoiceStream announced Wednesday that it was releasing a tool that online video download sites could use that would help consumers get online video recommendations. The company already works with several top online retailers to offer personalized recommendations about what they might like based on what they’ve already bought.

And Videoegg, a company that distributes videos over a network of popular social networking sites such as Bebo, hi5, Tagged and Piczo, also has a presence in the video recommendation field. Videoegg has a so-called recommendation engine that allows people on the sites in the company’s network to easily tag and share videos.

The company, which is led by Adam Klein, a former executive at MTV, EMI and Ask Jeeves (before it became Ask.com) also has some impressive backing, including a recent investment by ad agency WPP Group.

Klein said that the social nature of recommendations could wind up being even more important than search given that popular online videos often spread across the Web rapidly when links get e-mailed or posted on social networking sites.

“There is a difference between search and recommendation. We’re not trying to take on search,” Klein said. “The power of user recommendations can be huge and you can still segment by category, genre or artists and tag everything.”

So it looks like there are lots of companies out there trying to tame the unwieldy Wild West of online video and make it a more friendly place for people to navigate. But it’s way too soon to predict who will win and lose in this nascent market.