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Joost announced today that it is shifting business strategies and it “will focus on providing white label online video platforms for media companies, including cable and satellite providers, broadcasters and video aggregators.” As part of this transition, Mike Volpi will step down as CEO and Matt Zelesko, who is currently the senior VP of engineering, will take over while still leading the engineering team. Volpi will remain chairman of the board.
What makes this move seem all the more doomed is that Joost is already enlisting another white-label video provider, Ooyala, to manage its ingesting, transcoding and metadata management. How exactly will Joost pitch itself as a competitor to Ooyala (where Volpi is also on the board) when it uses Ooyala itself?
Joost said it will maintain a core team in New York and London to work on the new white-label biz, as well as operating Joost.com. The company will “wind down” operations in its Leiden development center. According to a statement attributed to Volpi, Joost “will say goodbye to many of our colleagues and friends,” which seems like it could not mean anything other than layoffs, but Joost wouldn’t elaborate further or provide specific numbers.
In April, it was rumored that Joost was looking to sell itself and had even talked with Time Warner Cable.
We used to joke here at NTV that becoming a white-label video provider was what a business did when all other strategies failed. And it looks like Joost is no exception. After starting off as a P2P-based app, the company found that requiring a download hampered its ability to gain traction. It then moved to a plug-in and eventually moved completely to a Flash based method for watching web TV.
But as Joost struggled to find its way, the door was open for rivals like Hulu to swoop in and establish themselves as premium content portals. A quick look at Compete.com shows how Hulu has soared while Joost pretty much flatlined:
But a bigger problem is that unlike Hulu, where its owners/content partners like NBC and FOX seem to take an active role in the success of the site, Joost’s media company investors Viacom and CBS treated the service like a red-headed stepchild. While Hulu has raked in brand-name content, Joost has tried to make do with its limited catalog. Earlier this month, the company signed 12 content partners — but none of them were big name TV or movie companies.
Joost was once heralded as the future of television. Times have changed.