Boingboing's current guestblogger Paul Spinrad is Projects Editor for MAKE magazine and the author of The VJ Book and The Re/Search Guide to Bodily Fluids. He lives in San Francisco with his wife Wendy and their two young children Clara and Simon. 
Some communications need to be ambiguous in order to work. Like, if you consciously or unconsciously don't like an idea in a meeting, rather than voicing disagreement explicitly, you might exhale slightly or turn away a bit and then see what others do, also consciously or unconsciously. I think this is one reason teleconferencing is difficult. These channels by their nature need to operate at the edges of perception, and unless your A/V is super high resolution, they're blocked. (Eye contact is another conferencing issue.)
The same goes for flirting– that next glance should have a plausible other function besides showing interest, and no current online representation can convey this ambiguity. There's no "did he just send a winking smiley to me, or did he accidentally push the button while going to pet the cat?" (Although you could design this in by introducing a chaos filter that wiggles the action just enough to provide plausible deniability for isolated events.)
Live audiences bristle with such liminal communications. As an audient, you don't just hear the applause and laughter– you also pick up on body language, breathing, attention, and emotional state. You're part of one enormous brain that, among other things, is working out the problem of how people in the surrounding culture and at the present moment react to things, and what reactions are and are not appropriate. Live audiences are where we draw our lines.
Productive settings for comedy always need a live audience, even if it's ultimately for television, and the more worked-up and demonstrative the audience feels free to be, the greater the bandwidth of the internal communications bus of audience-performer interaction. Vaudeville, with short bits and a hook to remove bombing performers, is like speed-dating for culture.
Our expectations and habits around being audience members have atrophied ever since movies became popular, but I think live video will retrain us. Movies taught us to sit together and pay attention to a dead, unchanging recording rather than something living and responsive. Symphony orchestras seemingly do their best to imitate recordings, while the audience sits quietly and obediently. Instrumentalists play someone else's cadenza note-for-note instead of doing something unique and current. (Then the symphony development people wonder how to attract younger audiences.)
Writing The VJ Book got me excited about the possibilities of live video, which supercharges the audience-performer communications bus. Digital projectors, fast laptops, and new software let almost anyone improvise and connect the endless palette of visual meaning for large audiences anywhere. You can see great visual mashups on YouTube, sure, but that's a more alienated setting. Like DJs, VJs connect with fellow human beings who are lucky enough to all be together in a particular time and place.
Although there are loads of VJ applications, the genre is still on the commercial periphery. But I'm convinced that some company will do quite well for itself by being the first to introduce a live video app to a broader market and show people its potential. Beyond music and entertainment, it broadens the arsenal of anyone who performs, speaks, or otherwise presents to audiences. Imagine, for example, being a trial lawyer and using live video (is that allowed?) to present your story to a jury, combining your finely honed sense of timing with seeing-is-believing authority.
I think any of these companies could move into the space, and if so, it would quickly become "real" money-wise:
Ableton
Ableton Live already has a huge following among musicians, and Ableton Live Video would extend it to their visualist pals. VJs have already cooked up ways of getting Live to run video. Ableton just needs some of Adobe's expertise in handling video.
Adobe
Adobe Premiere Pro is the standard for video editing and Premiere Express is a fun online video mixing applet, so Premiere Live is a logical extension. Adobe just needs some of Ableton's expertise in building fast, bulletproof performance software.
Apple
Lots of VJs use Quartz Composer, which is bundled with OS X 10.4 and above. If they offered a full VJ app that hooked into QC, it would be another reason for people to switch.
Microsoft
From a different direction, PowerPoint is increasingly turning into a live video tool, and unlike the 3 companies above, Microsoft doesn't have to explain to Powerpoint users why they need presentation software (performance software– same thing). When Japanese company motion dive surveyed the users of its VJ software several years ago, they were surprised to find that it was mostly used for office presentations by younger business types rather than the club visuals mixing that the software was originally designed for.
Existing VJ Software companies
AFAIK, all makers of current VJ apps are small, often side operations. The ones I know about people using the most are ArKaos, Isadora, Jitter (with MAX/MSP), Livid Union, motion dive, Resolume, Modul8, Touch, and VDMX. Maybe some of the big companies listed above will acquire one or more of these? One sign might be that Numark now sells its NuVJ hardware, based on ArKaos, and Edirol/Roland sells its MD-P1, based on motion dive.
The Light Surgeons performance photo courtesy Barney Steel
