Joost Shifts Its Focus to Selling Technology

Once in the limelight of the online video revolution, Joost is shifting its focus away from its Web-based video service to selling its technology to media companies.

When online video operator Joost first appeared on the Internet landscape back in 2007, it was a force to be reckoned with: founded by the same folks who gave birth to Skype, Joost promised high-definition real-time streaming of real-time television programming over connections of even modest bandwidth: slap that together with a bunch of what we’d call social networking features today, and you might just have had a killer application for Internet video.

But things never quite gelled for Joost: although the company was able to line up many distribution partners, it never got the support of many big Hollywood studios or major advertisers to help foot the bills. Eventually, Joost realized its proprietary client software was a significant barrier to enter and converted itself over to a Flash-based video service that could be accessed by an everyday Web browser…but at that point the damage was already done, with sites like Hulu and the ever-present YouTube having captured the bulk of the online video market.

Now, Joost has decided to retool itself once again…but instead of being a consumer-facing service, the company plans to focus on selling its technology to media distributors and content companies as a "white label" video platform. Joost believes it can make some money by helping companies like cable and satellite operators set up their own video portals.

"In these tough economic times, it’s been increasingly challenging to operate as an independent, ad-supported online video platform," said Joost’s Mike Volpi, in the company’s blog. "We have built a solid technology platform that there is demand for in the marketplace, and look forward to this new chapter for our company."

Volpi’s statement implies the company will be laying off employees ("as a part of this change, we will say goodbye to many of our colleagues and friends"); as part of the changeup, Matt Zelesko will take over for Volpi as CEO, although Volpi will remain chairman of the board.

Industry watchers are skeptical of Joost’s ability to find a market in the digital media distribution business, where companies like Adobe, Akamai, and Brightcove are already well-established; however, Joost’s international ties may help it to gain footholds in markets not well-served by its new competitors.