Why Veoh is Having a Big Day

Veoh, the online video startup raised $12.5 million and the collective reaction question across the Web seemed to be What? Veoh's CEO explains his strategy, and then we do a little runthrough of a lot of video services trying to figure out their different market positions.

Veoh Networks, the online video startup announced that it raised $12.5 million from funders including Michael Eisner, Spark Capital, Time Warner and existing investor Shelter Capital Partners. And the collective response across the Web seems to be What?

In terms of traffic, Veoh is outstripped by YouTube, so what would make investors pony up? According to Veoh’s founder and CEO, Dmitry Shapiro, it's because Veoh's P2P technology enables independent video makers and Hollywood types alike to dish up longer (movie or TV show length), better quality video online. Where YouTube dominates in the short form, Veoh is looking to be a player in the market for longer videos, Shapiro says. Veoh is free to use, but as producers make money from selling or advertising on their content, Veoh will take a cut of revenues.

So how do we make sense of all these video companies? Shapiro put in his two cents, but would love to get your input, if you have been following any of these.

Brightcove and Maven look like they're aimed at selling a service to established companies and advertisers to create online channels for their content, even allowing them to syndicate the content across other sites.

YouTube, Vimeo, et al are destination sites that combine video sharing and social networking. They started as a way for individuals to share their short videos. But YouTube, at least, is trying to do deals with tradiotional companies as an entertainment hub for distributing short video.

Revver is aimed at working with traditional companies or indie producers as well to commercialize their short form works. Revver inserts code in each video that enables filmakers to track their videos as they are shared, emailed, or IMed, and also to insert ads. Revver takes 1/2 of any revenue the filmmaker makes.

Kontiki, BitTorrent: P2P services that are trying to work with indie and traditional companies. Maybe too proprietary or distrusted by traditional companies to get traction? Still to be seen.

Akamai, Limelight: Content delivery networks that offer a service and charge a bundle for delivering straight bits, but making sure that they do actually get delivered and aren't herky jerky.

Anyone I am missing, totally wrong on any of this?

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