Joost’s Last Hope Isn’t A Promising One

It's sad to see a company that we were all so excited about fade further into oblivion. Today Joost, one of the most anticipated startups in 2006/2007, is just an also ran in a sea of big online video sites like YouTube and Hulu. Today CEO Mike Volpi stepped down, the company is laying off most of staff, and refocusing the business to "white label online video platforms for media companies."

Om has a good monday morning quarterback overview of why they failed, but to me it comes down to just a few things. They over funded ($45 million before they even launched) and they ignored the fact that users were quite willing to sacrifice quality in online video for the convenience of Flash in the browser. Joost waited until late last year to go all Flash - until then users had to use the downloadable Joost software and allow P2P streaming of shows. In the meantime there was no linking to Joost videos. YouTube and Hulu got all that social media and SEO juice that could have gone to Joost.

Founders Niklas Zennstrom and Janus Friis, who founded Skype and Kazaa, see the world in terms of P2P and downloadable clients. The joke about how everything looks like a nail if you're a hammer is very true with Joost. But what worked with Kazaa and Skype a decade ago doesn't work with online video in today's world, obviously.