Vdio, the online video service founded by Skype co-founder Janus Friis, is finally emerging from stealth mode. The company just launched a new homepage, which touts a private beta test, and comes with a few surprises: Vdio is getting ready to launch in the U.K. as well as in the U.S., and a screenshot of the service as well as the site’s Terms of Service reveal a purely transactional business model. In other words: It won’t directly compete with Netflix, but is instead targeting iTunes and Vudu.
That’s a notable change of tune from October 2011, when GigaOM first broke the story of Vdio’s existence. Back then, everything pointed to Vdio going into the video subscription business, and leaks in the following months hinted at plans to combine a Netflix-style subscription with transactional VOD. Those plans have seemingly been scrapped, and the new homepage describes the service the following way:
“A better way to watch. Rent or buy movies and TV shows worth tuning in to.”
The accompanying screenshot shows popular movie and TV show titles like Prometheus, Breaking Bad, Ted, Monsters Inc., The Dictator, Family Guy, Pulp Fiction, Doctor Who, The Woman in Black, Real Steel and The Amazing Spider-Man.
Judging from these titles, Vdio has partnered with Disney, Fox, Sony Pictures, Universal Pictures, AMC, BBC America, Lionsgate, Paramount, CBS and DreamWorks Pictures – a pretty impressive list.
Just as noteworthy however is that Vdio is going to launch in the U.S. right away as well. Last year, the company said that it would initially only be available in the U.K.
The story behind Vdio’s delayed launch
Vdio has been a bit of an enigma ever since our first report about the company. The team behind it stealthily worked on the service since late 2009, and signs initially pointed towards a launch in early 2012. But in March, Vdio abruptly fired most of its engineering and design staff, including its CTO Justin Erenkrantz and a number of other people who had previously worked with Friis on the ill-fated video streaming service Joost.
I had a chance to briefly chat with Vdio CEO Ian Aaron about the upheaval a couple of months ago, and he told me that the company’s decision had a lot to do with the fact that Friis already had another media venture on his hands: Rdio, the music subscription service that is competing with Spotify and others, had already solved a lot of the problems that Vdio was working on. “We were literally reinventing the wheel,” said Aaron. That’s why the decision was made to share resources instead, he explained.
Vdio’s close alignment with Rdio
Aaron insisted at the time that despite those shared resources, Rdio and Vdio still remained separate companies – a line repeated by a Rdio spokesperson when my colleague Robert Andrews inquired about the two companies in September.
However, the relationship between Rdio and Vdio seems to grow closer by the day. Vdio’s website is hosted on Rdio’s servers, and the screenshot of the service prominently features the user name of Rdio’s VP of Product Malthe Sigurdsson. Vdio’s Terms of Service also reveal that users will be able to log into the service with their Rdio account. The two services apparently plan to offer users a way to use payment information provided for Rdio’s service to pay for movies bought on Vdio, and gift cards will work for either service. From Vdio’s Terms of Service:
“Unless otherwise specified or inapplicable, you will be able to use your Vdio Purchase Offerings on Rdio and your Rdio Purchase Offerings on the Vdio Service.”
Also interesting: Vdio’s Terms of Service now list Rdio’s address, and not its original Santa Monica office, as its principal business address. I wouldn’t be all too surprised if the two companies made their bond official once Vdio emerges out of private beta – but right now, it’s still unclear when that will be.