Backchannelmedia

Jack Myers Media Business Report, February 21, 2007

JOOST Seeks to Redefine Television for Viewers and Advertisers

by Jerry Weinstein

While the remote control device, the VCR and DVR were enhancements to the TV viewing experience, they seem almost quaint now compared to the hyper-linking and robust targeted video search capabilities of the Internet. Now there is Joost,, formerly known as The Venice Project and developed by the founders of KaZaA and Skype, that leverages the power of peer-to-peer networks (P2P) to bring free high-resolution TV to the desktop computer. Joost is being positioned as the first true global Internet distribution platform for broadcast-quality TV content, basically offering TV programmers a supplemental online venue for their content that offers pinpoint targeting opportunities to advertisers. Yesterday, Viacom announced that MTV Networks, BET Networks and Paramount Pictures will provide television and theatrical programming on the Joost platform.

Between the growth of both PC processing power and accelerating broadband speeds, the online user experience is predicated on the search for personalized content. YouTube's sudden impact was a wakeup call to programmers and advertisers alike, signaling the advent of "viral video," albeit delivering snippets of content. But until now the experience of watching full TV episodes online has often been plagued with technological hiccups.

Joost co-founders Niklas Zennström and Janus Friis, who built and sold Skype to eBay for $2.6 billion, envision a future of television that combines traditional content with the Web's navigation tools, providing a dynamic experience to users that will, in turn, be a magnet to both advertisers and content owners. While YouTube grew at a blistering pace despite poor video quality and lack of long-form, Joost believes that there is a hunger for long-form HD quality streaming content that is encrypted and legal. Joost's epiphany is that it recognizes that TV has been nurturing "social networks" around sitcoms such as I Love Lucy and cult dramas like Star Trek long before the term was coined. All that Joost requires of potential viewers is that they perform a 10 Megabyte download; and they're off! (www.joost.com) By combining the best of WWW navigation in a translucent, intuitive interface, and adding community features of the emerging social web, such as RSS feeds, instant messaging, channel chat, and program ratings, Joost is building the first effective online feedback mechanism for TV.

This will be a boon to advertisers who are seeking improved methodologies for both targeting and communicating with audiences. While Joost executives won't say if they will be partnering with Google's AdSense, Yahoo!, AOL and/or Microsoft, it does appear that the startup is in the process of building a proprietary back-end ad engine. While personal IDs will not be stored on a central server -- they will remain on one's own PC -- advertisers will be able to cherry pick users by location, time/date of viewing, viewing history and preferences, and even profiles of Joost members who opt-in. In the future both advertisers (and programmers) will have the flexibility to upload content themselves. Like Backchannelmedia, Joost believes that the volume of commercial advertising will drop by 90% as ad relevance soars. Joost advised Jack Myers Media Business Report that it is planning additional announcements that could represent significant advances in both program content and advertising relationships. Last year, Joost hired MTV executive David Clark to manage advertiser relationships. [david.clark@joost.com] Current advertiser relationships include T Mobile, Wrigley, L'Oreal and Phillips and Clark tells Jack Myers Media Business Report that early recall results "are through the roof."

As Joost launched its 0.8 Beta release last weekend, there was some tangible discussion within its blog (http://www.joost.com/blog) suggesting how advertising would be supported. Wrote Joost staffer Simon Lucy, "[Release] 0.8 puts more flesh on the advertising bones, as more of the content has insertion points delivered along with the video the mid-roll adverts will happen at the right time instead of an arbitrary, yet precise position. Another advertising feature is that each advert, whether the beginning 'blip-vert' or the mid-roll 30-second break will have an associated interactive overlay with it. You select it in the same way as you do for a regular show, click the Logo at the top of the screen when the advert is playing." ("Blip-verts" are three to five second video messages.)

While Joost gets high marks for tailoring a system that advertisers will find shrewd and malleable and it deserves kudos for the quality of its interface and resolution, it still has miles to go before its content is compelling. For now, its channels are strange bedfellows, with equal emphasis on programming for the Maxim crowd (channels for Paris Hilton, P. Diddy, auto racing) and long tail content for NPR-o-holics (IndieFlix, National Geographic channels).

Lack of content has been Joost's primary challenge and Viacom is the first media conglomerate to validate the company's platform. While some may be personally tickled to see Rocky & Bullwinkle, and many are not averse to nature docs, Joost has been a desert compared to the 1000 channel cable and satellite universe. Joost claims that a number of announcements will be made in the near future and the company is in talks with three music majors, while it currently has a deal with Warner Music that manifests in at least two music offerings: Warner Music and Atlantic Street (from its Atlantic label), in addition to yesterday's deal with Viacom. Joost has indicated it's speaking with other content providers. In its announcement, Viacom commented "Through Joost, viewers can watch programming from many of Viacom's brands on their computers through a customizable platform with advanced television viewing features such as links that lead to more information or related websites based on the content; and a variety of plug-in applications, such as instant messaging, message boards, and news tickers." Although Joost promises a piracy-proof platform, rights issues remain a conundrum.

Joost's first enhancement for leading networks might be as R&D for television pilots. While video sharing portals like YouTube, eBaum's, and DailyMotion and social networking communities such as MySpace have been responsible for breaking (and resurrecting) series, Joost is unique in its capacity for viewers to watch and chat in real time. In a sense it's pre-viral buzz, with viewers discussing a pilot, critiquing the cast and plot, and rating how likely they are to watch again. For programs on the air, layering social community aspects into a fully integrated globally available video content platform could have staggering possibilities.

Rather than a Nielsen sample, with Joost programmers and advertisers can qualitatively measure discussion in real time. While the startup is shying away from user-generated content and instead is allying with professional content producers, the overlay of its interface - allowing members to create their own dashboards and widgets - will deliver on the promise that the future of television is in the hands of the audience.

Viacom reports MTV Networks will provide premier content from several of its brands for launch. MTV will offer popular shows, both past and present, including Laguna Beach, Beavis & Butthead, Real World, Punk'd and My Super Sweet Sixteen, while COMEDY CENTRAL will feature episodes from Stella, CCP's and Freak Show. Nickelodeon, CMT: Country Music Television, MTV2, Logo, Spike TV, mtvU, and Gametrailers.com will also provide content. VH1's offerings will include episodes of Flavor of Love, Surreal Life, and I Love New York. BET's Networks' offerings will include some of its biggest shows, including Beef, DMX: Soul of a Man, Comic View and recent smash hit American Gangster. Also, Paramount Pictures, Paramount Vantage and Paramount Classics will be providing full-length feature films from their catalog of classics and recent releases.