London-based broadband television start-up Aggregator has accumulated £9 million of further funding in equal investments from 3i, Amadeus and Intel for its forthcoming niche network video operation.
Aggregator, a client of informitv, was founded in May 2005 with seed investment from Amadeus Capital Partners. The further funding round will be used to support the rollout of broadband video services over the next two years.
The company plans to launch a range of broadband video services, initially to personal computers, which will target specific niche interest and ethnic communities that are currently underserved by mainstream broadcasters.
The first of these will address expatriate Russian viewers living in the UK. Their proposed brand, Moë TV, means ‘My TV’ in Russian. There are nearly half a million Russians living in the UK, and unlike some other ethnic communities, they are not well-served by existing television channels.
The aim is to build communities and customer relationships on the web, and then offer the opportunity to migrate to other platforms.
Aggregator intends to follow up with a hybrid broadband and digital terrestrial television set-top box service in early 2007, which will incorporate Freeview channels.
Meanwhile, the company is developing a standards-based, device-agnostic platform, promising high-quality pictures, eventually available for viewing across multiple devices, including PC’s, set-top boxes and gaming consoles.
Initially targeting the UK market, the company is also looking at international opportunities but says it is not trying to provide a global proposition at the outset. It has rights to launch on the video-on-demand portals of other operators.
Aggregator has already acquired licences for over 30,000 hours of content and is looking for partnerships with other programming providers.
“We’re delighted to have brought together a very strong funding consortium comprising leading venture capitalists 3i, Amadeus Capital Partners and Intel Capital,” said Aggregator co-founder and chief executive Martin Goswami. “Their support validates our vision of what future content services will look like and makes it possible for us to launch and rapidly grow a truly unique television service.”
“With web TV and IPTV gaining broad consumer acceptance across the world and on the back of increased broadband penetration, the timing is right for Aggregator’s proposition,” said Krishna Visvanathan, 3i director and now a board member at Aggregator. “Aggregator fits well will 3i’s strategy of backing talented individuals with disruptive business models in the digital convergence arena.”
Simon Cornwell of Amadeus said: “We believe that broadband delivery will transform the television landscape in the next five years, creating a fast growing opportunity for new companies with a disruptive approach to the market.”
Intel Capital sees it as part of their vision of the digital home, according to their investment director, Alain-Gabriel Courtines. “The Aggregator service is facilitating this vision of convergence between the internet and traditional broadcast television by offering a hybrid model between the TV and PC with niche content that is not available over traditional free-to-air and pay-TV platforms.”
Aggregator will face competition from BT Vision, which is expected to launch before the end of the year, with a hybrid broadband and broadcast offering based on a Microsoft platform and a set-top box from Philips.
BSkyB is launching its own broadband service, which will be free to satellite subscribers for the base level.
However, Martin Goswami, a former commercial director of BSkyB, believes that the investment of others in broadband infrastructure will simply expand the market for their niche video services.
He co-founded Aggregator together with Chris Griffin, who was previously director of channels at Granada Media, now part of ITV, and formerly director of distribution at MTV Europe.
The founders have significant experience in the traditional television world, but believe that broadcasters, which are focussed mainly on protecting their existing businesses, have been slow to exploit the opportunities of broadband.
They see that the untapped pay-TV opportunity is for flexible ‘long-tail’ niche content, which they believe requires different skills in packaging and presentation to those of incumbent broadcasters.