News

Internet Video Pair-Up

9/21/2008 8:00 PM Eastern

Promising to serve media companies a full buffet to feed their Internet video appetites, Anystream this week is planning to announce a deal to merge with content-syndication firm Voxant.

The deal brings together Anystream, a provider of Internet media-encoding, rights-management, production and other services, with Voxant, which distributes licensed content from more than 300 news and entertainment organizations including NBC, Reuters, CBS, MTV News, the National Basketball Association, The Wall Street Journal and The New York Times to a network of more than 30,000 blogs.

The idea, according to Anystream CEO Fred Singer: to let content owners distribute to as wide an audience as possible and make money from that reach.

SOURCE: Multichannel News research
ANYSTREAM
Description: Internet video encoding, management and distribution services
Customers: 700 media companies worldwide
Employees: 90
Headquarters: Dulles, Va.
Investors: SCP Private Equity, SoftBank Capital, Falcon Private Equity, Court Square Ventures
VOXANT
Description: Content licensing, advertising and Web syndication services
Customers: 500 content providers and 30,000 Web affiliates
Employees: 35
Headquarters: Herndon, Va.
Investors: Longworth Venture Partners, SoftBank Capital, Court Square Ventures

“This is a natural evolution of what we see our customers want,” he said. “Without an efficient way to scale and monetize video across many sites, it won’t work.”

The Voxant network affiliates range from individuals (like “Sally’s yoga blog”) to larger sites like HuffingtonPost.com.

“We broker transactions between people who own content and people who want it,” said Voxant CEO Marcien Jenckes. The company sells traditional online advertising based on cost per thousand impressions, splitting revenue with the content owners.

Anystream described the deal as a “merger,” but the company acknowledged that it is technically the acquiring entity. Financial terms of the transaction are not being disclosed.

Singer said the new company plans to adopt a new name but that hasn’t been chosen yet. In any case, he added, Anystream will remain as the brand for the video-encoding and -management services.

The companies are based about five miles apart, in northern Virginia. They also share two venture backers — SoftBank Capital and Court Square Ventures — which surely greased the skids for the deal.

Anystream will still compete with a wide range of players in the Internet video infrastructure space, including Comcast’s thePlatform, Brightcove and Yahoo, which recently acquired video-management startup Maven Networks.

But unlike those providers, the Anystream-Voxant team marries an online-video marketplace with back-end management services.

“There are thousands of vendors selling pieces of the puzzle,” Singer said. “What this merger does for the first time ever is to bring the infrastructure and the distribution networks together.”

It’s not clear how many media companies would want to turn to a single provider for soup-to-nuts Internet TV services, from content licensing, advertising, encoding and media-rights management.

Anystream and Voxant said clients of either company can opt to use an integrated solution to automatically package, categorize, syndicate and monetize their assets — or not. “While we’ve built an end-to-end solution for the market, we don’t require customers to use it in that way,” Singer said.

With Voxant’s syndication marketplace, Singer said, “what we’ve done is to make it as easy for NBC, for example, to send their video to 1,500 sites as to 15 sites.” Anystream provided video-management services for NBC Universal’s Internet video from the Beijing Olympic Games.

According to Singer, less than 15% of professionally produced content reaches the Internet for monetization, for reasons ranging from limited production tools to piracy concerns.

“There’s a reason YouTube has huge traffic and low revenue: It’s because that’s not the kind of video big advertisers want to put money behind,” he said.

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