Online video: another one bites the dust

28 07 2007

For all the successes in the online video landscape, some offers from major brands have been spectacularly underwhelming and have either had the plug pulled or been left to quietly die.

ThisJustIn, the comedy site launched just six months ago and aimed at being a “brand extension and potential development pipeline” for HBO, has been axed by parent company TimeWarner, reports Variety.

The report states: “the site, which was a joint venture with AOL (and replaced that company’s existing comedy channel), never got off the ground. It suffered from what some visitors said was a confusing layout as well as a lack of marketing exposure.”

Apart from the absolute no-brainer that intuitive navigation should be a given, it also highlights the importance of on-air cross-promotion for any online initiative launched by a broadcast network.

Other famous casualties on the Road to Online Damascus include CBS’s Innertube and Annheuser Busch’s lame duck bud.tv.

The latter fell at at the first usability hurdle by being compelled to introduce an age verification system during registration, so complex that traffic plummeted. Even once in, users were subjected to such lacklustre content, they seldom came back.

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The cost of online video-on-demand

30 06 2007

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4oD: not explicitly reported, but new media division – spanning other activity too – spent £34.6 million, up £11.5m on 2005. (Source: C4’s 2006 annual report).

60frames: the JV between Hollywood power brokers United Talent Agency and online ad agency Spot Runner. Start-up capital of US $3.5 million. (Source: Globe & Mail, 31 Jul 07)

Babelgum: €220 million [US$288m] (source: C21 Media [by subscription], 19 April 2007). Other sources suggest seed capital of €10 million [£6.78 million] from founder Silvio Scaglia, with a further €70 million pledged during the next three years.

BBC iPlayer: £4.5 million (source: The Sunday Herald [UK], 2 December 2007). Funded by licence fee.

BitTorrent: backed by US $20 million from  Accel Parners and DCM.

Break.com: Lionsgate has invested US $21million for a 42% stake.

Brightcove: US $81 million so far… Launched 2005 with $5.5 million funding from General Catalyst Partners and Accel Partners (source: company press release, 1 March 2005). Raised a further $16 million the same year, attracting investment from AOL, IAC/InterActiveCorp, The Hearst Corporation, and Allen & Company LLC (source: company press release, 22 November 2005). A further $59.5 million was sunk by a syndicate led by AllianceBernstein L.P., Brookside Capital LLC, Maverick Capital, Ltd.; the funding round also included investments from The New York Times Company, Transcosmos Investments & Business Development, Inc., as well as all of the company’s existing strategic and financial investors: Accel Partners, Allen & Company LLC, AOL, General Catalyst Partners, The Hearst Corporation, and IAC/InterActiveCorp. (Source: company press release, 17 January 2007).

Bud.tv: backed by parent company Anheuser-Busch to the tune of US $30 to 40 million.

Dave.tv: Provider of video distribution and social networking platforms to content providers, founded in 2003. The company is currently backed by angel investors, including Applied Semantics co-founder Rex Wong, who is believed to have sunk at least half of the company’s initial $7 million funding (source: MarketWatch, 1 Aug 2006). Potential investors take note: the company’s site says “We are in the midst of seeking strategic or venture capital to facilitate our growth.”

ITV Broadband: £20 million (source: Digital Spy, 8 June 2007).

Hulu.com: NBC Universal / NewsCorp.’s JV, originally dubbed ‘Newco’: US $131 million (source: LA Times, 29 June 2007).

Joost: seed capital of US $45 million (source: Wikipedia, 29 June 2007). Backers include Sequioa Capital, Index Ventures – an early investor in Skype – CBS, the US media group, and Li Ka-Shing, the Hong Kong tycoon. Viacom, the US media giant, also has a minority stake.

Vmix: seed capital of US $5 million in 2005 (source: Marketwatch, 1 Aug 2006), plus further funding of $16.5 million in October 2007 (source: Vmix press release, 31 Oct 2007). Founded by former execs from Universal Music Group, Fox Studios, Apple and mp3.com. JK&B Capital and ATA Ventures joined existing investors Mission Ventures and Enterprise Partners in the latest funding round.

Vudu: founded 2004, launching summer 2007. Backed by US $21 million from Benchmark Capital and Greylock Partners.

Vuze: backed by US $13.5 million raised from Redpoint Ventures, BV Capital, Greycroft Partners.

Update 17 Dec 07

Recommended reading: Media and entertainment freelance writer Daisy Whitney has produced this excellent summary of going rates for online video advertising rates on some of the best-known sites.