So rest in peace Joost. Oh it’s still there, but it has gone horribly wrong. TV over peer to peer has been bypassed by TV in favor of simple Adobe Flash streams. So this week Joost put out a statement that it would go into the business of providing white label online video platforms. That sounds like it is in the business of being a simple content delivery network. It’s original aims were far higher and most of our expectations were higher still.
Joost said that it will now focus on providing white label online video platforms for media companies, including cable and satellite providers, broadcasters and video aggregators. It is a service business, with a small technology edge, and it will no longer try to be a consumer set of online TV channels.
Back in April we wrote about Joost for the first time in two years, having been fairly excited about it, along with the rest of the media world, back in 2006. In April we were simply repeating and analyzing rumors that it was up for sale, along with around 2 million viewers that it had amassed – numbers which pale into insignificance when compared to, say YouTube.
Both Joost and another similar European business called Babelgum, made the bet that the delivery platform of Peer to Peer was the answer to TV delivery, in much the same way that iPlayer for the BBC made such a bet, and later changed it to straightforward streaming. The difference was that iPlayer had all that lovely beloved BBC content, while the other two had the idea that getting rid of server based file economics was enough for them to dominate. And for a while there, before Google bought YouTube and the US broadcasters decided to back Hulu and other initiatives, it looked like they might. Babelgum still seems to be going down this track, though not successfully.
Joost was brought to life by Janus Friis and Niklas Zennstrom, the same pair that brought the world Skype. In 2007 it took on $45 million of venture capital from Index Ventures and Sequoia Capital. Index was one of Skype’s investors.
Back in April Joost was supposed to attract a big buyer like one of the US cable companies, to use its technology for online TV program delivery ‘ now it seems that no-one wants to buy it, but that it wants to get directly into that business itself. We cannot see it finding many customers.
It is true, as a Joost statement says, that media companies around the world are embracing internet-based video portals as a key path to distribute their premium video. But although this can be technically difficult and expensive, there are plenty of businesses out there that are expert in that role, and the changing directions of Joost is likely only to confuse and disaffect them.
As a part of this new direction, Joost says it will reorganize and restructure its business. A core team in New York and London will work on providing these new white label portal systems as well as continuing to run the semi-failed core business at Joost.com. It will wind down operations in its Netherlands Leiden development center and lose its rising star CEO in Mike Volpi, who gave up a promising career at Cisco, to take on the role. Volpi will remain on the board as chair, but hand over day to day operations to Matt Zelesko, SVP of Engineering, who himself came out of Comcast.