Big Media Boosts Internet TV in 2007

Big Media Boosts Internet TV in 2007


28 December 2007, 12:51
by Justin Moresco / Red herring

YouTube
proved that online video was attractive to consumers, but it’s big-time
content owners, such as MTV and Showtime, and the promise of big-time
ad dollars that have largely spurred the growth of Internet TV in 2007.

“The trend has been that content owners learned that
syndication was to their benefit,” said Parks Associates analyst Kurt
Scherf. “Their strategy has
been to work with all kinds of destinations.”

Internet
TV startups have benefited from these deals, drawing customers with
long-form, HD-quality offerings, and differentiating themselves from the
many sites serving up amateur-made content.

Venture
capitalists have taken note. Most recently, Palo Alto-based Vuze picked
up $20 million last week in a third round of funding.

The
company, formerly known as Azureus, said it now gets 500,000 new
viewers joining per week to tap into its on-demand content. More than
100
partners—including the BBC, National Geographic, and
Showtime—have signed on for a cut in the revenue generated from
download fees and advertisements.

Chris Moore, partner with
Redpoint Ventures, which backs Vuze, said the startup aims to provide a
more traditional TV viewing experience with the familiar benefits of
the Internet: delivery wherever and whenever the consumer wants it.

Luxembourg-based
Joost is perhaps the best known in the online TV space. This week, the
startup announced that it will begin featuring content from U.S. public
broadcaster PBS and the National Basketball Association. It already had
deals with CNN, MTV, and Comedy Central.

Mr. Scherf said the
companies that can distribute the content at high speeds, at high
quality, and at prices that are attractive to the content producers
will win
out.

But it’s not just companies with big-media
deals that are riding this wave.  Startups such as San Francisco-based
Revision3 are creating and producing
their own HD-quality shows, carving niches for themselves while purposely avoiding the Viacom’s of the world.

They’re
hoping to build large fan bases around alternative shows, with
names such as Tekzilla and notmtv. While the plots and characters might
not be as mainstream as those on Sex and the City, advertisers drawn to
the site like IBM and Sony certainly are.

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