Come Monday, one of the older brands in the crowded online video community — it was founded three whole years ago — evolves from user-gen-oriented Grouper Networks into Crackle, described as a streaming entertainment network dedicated to discovering, promoting and distributing new talent. Or, as co-founder/co-president Josh Felser puts it a tad dramatically: “User-generated is dead to us. We are out of the user-generated video business.” (They aren’t, actually, but they are out of the “relying on user-generated video” business.)
The move comes a little less than a year after the start-up was acquired by Sony Pictures Entertainment (SPE) for $65 million and marks its second major strategic shift. The first was when Grouper shifted from its original concept of a private p2p file-sharing for groups to creating a video network with an emphasis on user-generated content. Felser told me this phase of their evolution was underway “even before Sony bought us. We realized user-generated video is something everybody likes to watch but it’s not a great business. It’s too difficult to make money.”
Talent scout: Crackle combines a shift to professional video with the resources of Sony but, instead of becoming a home for content from SPE, it will act as a talent scout and, at times, a producer. Felser also expects more deals that “leverage the audiences of Sony properties but create something new.” The best example, so far: Firehouse, a channel of “real” stories from firefighters sponsored by Sony’s firefighter series Rescue Me. (The Spiderman 3 channel was strictly promo.)
Prizes “you can’t buy”: A lot of what Crackle is doing isn’t new or startling — talent contests, for instance. Yes, Felser admits, other sites doing contests for cash but, he adds, “Crackle is doing prizes you can’t buy” like meetings with Sony execs. “We can do that because we’re owned by them.” They call that aspect “fame partnerships” with ongoing access and exposure to leaders across concepts and genres. Animator winners will be plugged in to Sony Picture Imageworks and Sony Pictures Animation, etc.
Beyond that, he says, “I think it’s the package that makes us stand out.” That package includes the talent hunting; multi-platform distribution and syndication; original content, some financed by Crackle, through 12 branded channels; enhanced viewer technology with wide-screen format; branded advertising. Four of the branded channels have “fame” contests. “
Being acquired by Sony gave Grouper another key asset: access to a 60-person sales team “all focused on selling video.” Felser hopes that — and the exposure — will sway talent comparing Crackle to other sites.