“An acquisition which was doomed from the get-go” is how Faultline Online Reporter has historically referred to the purchase of video platform provider Ooyala by Australian telco Telstra, over two stages in 2012 and 2014. At the time, everyone quietly muttered the same question, “what on earth does a multi-billion dollar operator want with a $500 million vendor?” The two promised to take South East Asia by storm, but fast forward a few years and Ooyala has just sold out to rival Brightcove for pennies – $15 million to be exact ($6.25 million in cash and $8.75 million in shares).
Brightcove is specifically buying Ooyala’s online video platform (OVP) business, comprising a CMS and publishing platform, called Backlot, along with its Analytics and Live products, and much of its IP backbone technology too. How much of the Ooyala team will remain is unclear, other than Brightcove citing “substantial portions” of the engineering and sales workforce will move over.
Brightcove and Ooyala have both been in the game for over a decade, in which time they have been key players in the OTT video revolution. The two vendors have grown to become prominent names, enjoying much success in fields including video players, workflow tools, analytics and advertising technology. Commoditization has crept up in the end, but that doesn’t necessarily mean the future is bleak for a merged Brightcove-Ooyala.
Only in June last year we spoke with Ooyala CEO Jon Huberman, who, in all honestly, did an unconvincing job of persuading us the Ooyala ship was not destined to sink. We recall a blank face when we said that dirty word “commoditization”. Nevertheless, we prefer not to kick a man when his chips are down and suggested an unlikely – make that very unlikely – turnaround could be on the cards after the company picked up a promising deal at Turner Asia Pacific, deploying Ooyala’s Flex platform in the cloud to handle content syndication, essentially ironing out the workflow process. Ooyala said Turner Asia Pacific reported about 85% savings on the amount of time its various teams spent on workflow.
Following the brutal $500 million write down at the expense of its ad technology business last year, Ooyala then went back to square one in October, completing the management buyout from Telstra. The writing was on the wall really but Huberman became uncontactable thereafter. Ironically, the buyout announcement said it was weighing up acquisition possibilities – little did we know it meant for Ooyala itself.
But save the tears, for there is an amusing element to this story. Less than two years ago, Brightcove and Ooyala were at loggerheads in a Latin American turf war, involving allegations from Ooyala that Brightcove had stolen some precious business strategies specific to the continent – including customer lists, sales pitches, pricing, market plans and corporate strategies. We think you know where this is going. “We can tell you for sure that the Ooyala strategy is not working in Latin America, so we’re not sure what is worth stealing,” wrote Faultline Online Reporter in May 2017.
Now the two have broken bread, or rather been forced together due to the commoditization of OTT video technologies, Brightcove will inherit Ooyala customers including Turner, Audi, Dell and the PGA Tour, as well as Turner Asia Pacific.