After YouTube: Getting Joost Up
It’s Go Time for Much-Anticipated Web-Video Startup
By Steve Donohue -- Multichannel News, 5/6/2007 8:00:00 PM
With new deals in place to distribute shows ranging from Charlie’s Angels to Larry King Live via the Internet, Joost is finally out of the starting gate.
The Luxembourg-based company — which is trying to create a form of peer-to-peer distribution that is profitable for content producers — launched commercially last Tuesday. But you still need to know one of its 300,000-plus beta customers in order to access content until later this month.
“We are aware that it might be slightly confusing,” said executive vice president of content strategy and acquisition Yvette Alberdingk Thijm. “We’ve officially started running ads, and that’s the commercial part for us,” Thijm added. In recent weeks, Joost has cut deals with 30 blue-chip brands, including Coca-Cola, Hewlett-Packard, Intel and Nike.
| FACT SHEET: Joost |
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| Internet address: www.joost.com |
| Headquarters: Based in Luxembourg with offices in New York, London and Leiden, Netherlands. |
| CEO: Fredrik de Wahl |
| Founders: Niklas Zennstrøm and Janus Friis, creators of Skype and Kazaa |
| Commercial launch: May 1, 2007 |
| Subscription fees: None |
| Advertisers: Coca-Cola, HP, Intel, Nike, Electronic Arts, Kraft, Motorola, Microsoft, Procter & Gamble, Visa |
| Content suppliers: Turner Broadcasting, Viacom, CBS, Lime TV, National Hockey League, Hasbro, Sony Pictures Television, Havoc TV, National Geographic |
Joost was formed by Niklas Zennstrom and Janus Friis, digital entrepreneurs who’ve gone after communications companies before. They founded the nearly free Internet phone service Skype, which eBay picked up for $2.6 billion. Before that, they created Kazaa, a firm reviled for the way it encouraged the unprofitable sharing of music files over the Internet. A court ordered it shut down.
This time, commercial interests are paramount. Thijm said Joost will run traditional 30-second TV spots, in addition to unique ads, including one advertising unit she described as a “hand raiser,” in which the ad drifts across the screen.
Joost poses competition for advertising-supported video Web sites, such as AOL’s In2TV, Google Video and Yahoo Video. But the company isn’t competing directly with companies that sell content online, such as Apple’s iTunes store, which charges users $1.99 per TV episode.
Although Thijm said Joost hasn’t settled on a set amount of inventory that it will sell each hour, she said Joost will contain fewer commercials than traditional broadcast and cable TV programs. Right now, operators on those media traditionally run about 15 minutes per hour of advertising, according to a report released in April by media buying firm MindShare.
Thijm wouldn’t discuss how much ad revenue Joost would need to break even.
But she said Joost plans to bank on ad revenue to build its business, and — like broadcast TV — won’t charge subscription fees for content.
“We have no plans to do a subscription [service]. We really thought long and hard about the business model, and we believe that there is a huge market for long-form, free-to-the-user video; professionally produced storytelling,” Thijm said.
Havoc TV CEO David deKadt said the screen navigation and picture quality on Joost tops that of other video Web sites. Instead of a text grid, there’s a catalog of channels to pick from, and users can create their own collections from it, like playlists in iTunes.
“I think their interface is elegant and I think it will evolve as they learn what people are saying and how they’re using it,” deKadt said. Havoc TV is one of Joost’s content suppliers, and shares ad revenue with Joost.
Current Joost content offerings include half-hour and hour-long programs from MTV Networks, extreme sports from Havoc TV, CBS, BET Networks, Paramount Pictures, The Soccer Channel and Lime TV.
Deals Joost struck with programmers last week give users access to dozens of new programs, including:
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Aqua Teen Hunger Force from Cartoon Network’s Adult Swim programming block, CNN’s Anderson Cooper 360 news show and Larry King Live interview program, as well as Home Plate and Southern Home by Design from the former Turner South network.
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Charlie’s Angels, Spiderman, Starsky & Hutch and S.W.A.T. from Sony Pictures Television.
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Sports Illustrated swimsuit-issue photo shoots with Marissa Miller, Brooklyn Decker and Jessica White.
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Vintage National Hockey League games and highlights from regular-season contests and the Stanley Cup Playoffs.
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Two channels based on Hasbro toy properties — Transformers and G.I. Joe.
Like Kazaa, Joost relies on peer-to-peer Internet technology, in which large computer files can be efficiently distributed to thousands of users via the Internet by seeding the content on computers owned by users of the Internet service. Under new owners Sharman Networks, Kazaa converted to a paid content service last year, after reaching a $100 million settlement with record companies.
Thijm cited preparation time needed to build Joost’s P2P network as one of the reasons the service won’t be available widely until late May.
“The beta test is in the hundreds of thousands. We expect that to ramp up really quickly to millions,” Thijm said.
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Could you send me an invitation for 'JOOST' please. Thanks!
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