Joost, the online video service, is apparently preparing to scale back its global ambitions in order to concentrate on the United States market. Media reports suggest that the service is realigning its strategy after failing to convince media and sports rights holders to licence material on a global basis. Comments from insiders suggest that Joost is being squeezed on all fronts.
The Sunday Times reports that Joost is planning a “major retrenchment” — despite denials from the company. “We are not shedding staff” responded a Joost representative. “There are some situations where staff have been realigned to better fit our needs.”
Joost is moving its technical operations from The Netherlands to New York. Many of its major investors, including CBS and Viacom, are also based in the United States.
As recently reported by informitv, Joost has hired former CableLabs chief scientist and ex-Comcast engineer Jason Gaedtke as chief architect. He will report to Matt Zelesko, the head of engineering who was himself brought in from Comcast Interactive Media.
It follows the little lamented departure in January of its chief technology officer Dirk-Willem van Gulik to become chief technical architect of the future media and technology group of the BBC, reportedly after his contract with Joost was terminated.
Joost had appointed former Cisco executive Mike Volpi as chief executive last June, after attracting much media attention and $45 million of investment.
Quoted in the April issue of the Condé Nast publication Portfolio, Mike Volpi said the market had changed significantly over the year. “It went from ‘No one thought it was feasible’ to ‘Everyone is doing it’.”
Originally codenamed The Venice Project, the company was founded in January 2006 by Janus Friis and Niklas Zennström, the creators of the Skype internet telephony service.
Joost promised that it would “change the way people watch television”. So far it has failed to deliver this vision, while television companies like NBC with Hulu and the BBC with its iPlayer have gone on to command considerable media coverage for their own broadband video properties.
In response, Joost is understood to be developing a browser-based version of its player, which currently requires users to download a player application. It is also aiming to offer live streaming, in addition to pre-recorded videos.
Someone claiming to be a former Joost employee, writing on the technology web site Techcrunch, commented that: “The mood inside the company has been very, very bad for several months now, primarily due to the fact that there hasn’t been a whole lot of consumer uptake of the product itself.”
The anonymous contributor comments that “the investors are beginning to be really nervous”. He is critical of recent attempts to stream live sports, with coverage of the March Madness basketball tournament, which he describes as a “disaster” because the technology is not really designed to handle live events.
He suggests that Joost will pull out of Europe altogether, to focus on the United States, but is pessimistic of their prospects, given the success of others that have already occupied much of the space.
Mike Volpi has been rapidly rebutting the rumours. “We are focusing on US, Western Europe, China and a few other Asian markets,” he told Om Malik of the web site GigaOm. He said the company was taking a more measured approach. “What we are not doing is chasing every market, because as a start-up we need to be focused.”