The new Web video service Joost is barely in beta, but it's already subject to inhuman amounts of hype. It's not hard to see why. The service (say "juiced") is the next project of Janus Friis and Niklas Zennström, founders of Net phone service Skype. Its investors include Viacom (VIA ) and CBS. The company has just raised $45 million. On a good monitor, its satisfyingly full-screen playback looks gorgeous.
Joost's executives singlemindedly stress devotion to full-length programs and their respect for copyrights. They're auditioning to be the un-YouTube—an international Web video upstart that even a broadcast network can love. (When CBS wanted to demonstrate its embrace of the new world during its May upfront presentation, it proudly displayed programs running on Joost.) The top executives at Luxembourg's Joost are as charming and Euro-cool as you'd want in a forward-thinking media play. So I sort of feel bad that I don't buy what they're selling. Which is that TV on the Internet will, and should, closely resemble TV on the television—save for some tinges of interactivity like chat, and a thus-far unfulfilled promise of ultra-targeted ads. "Watching television is a very good experience," says Executive Vice-President Yvette Alberdingk Thijm. I agree, unless you're talking about My Super Sweet 16. But that doesn't mean it follows that long-form TV is what works on the Web.
ASK YOURSELF: What has worked on the Web thus far for video? Full episodes of the broadcast networks' best shows, or short-form stuff that can be annotated and shared? I'll give you a hint: YouTube, which does not show videos that run longer than 10 minutes, got 37.5 million unique visitors last month. But at CBS video site Innertube, which primarily streams long-form video, abysmal traffic has moved CBS interactive head Quincy Smith to crack that the site should be renamed "cbs.com/nobodycomeshere." This is a slightly unfair comparison, since YouTube aggregates video from everywhere. So will Joost, which is pursuing, and landing, nonexclusive deals to run programming from the likes of MTV and CNN. (Joost is offering premium players like Viacom and CBS generous ad revenue splits, which can net them a share of Joost-related revenues that approaches 90%.) But Joost's careful wooing of content owners has led it away from providing users with the tools that make the Web services feel like, well, the Web: sharing, clipping, commenting, playing with mash-ups. "There is something slightly half a paradigm behind [about Joost]," concedes one programming-side executive who's a fan of the service. Its promise on the ad side is more intriguing: that the Web's rich data on the locations and habits of users will eventually allow advertisers a measure of "addressability" unthinkable to TV advertisers, and deliver messages targeted to the Zip Code or even to IP addresses. But the platform can't target Zip Codes yet, says ad head David Clark, although he says it will within weeks.
Long-term ad success hinges on lots of users watching TV on Joost, and, frankly, the track record of sticking an unadulterated old medium up on the Web is not great. (Which is why so many print properties are madly lunging at Web video.) Joost is also betting on the convergence of the TV and PC, a prospect which I will believe in when it finally happens. Some video vets I talked to suggest Joost's long-term plan involves some combination of the following: dangling itself as buyout bait for a distribution company like Comcast (CMCSA ), getting into the set-top-box business, or even eventually running on the Skype platform—now owned by eBay, which is mulling applying its auction system to TV ads. ("In principle, the sky is the limit," says Alberdingk Thijm when asked about moving to other platforms, but she says no other plans currently loom.) If this is the case, one programming executive finds Joost's current stance slightly cynical, although he cheerfully claims "one can be cynical and idealistic at the same time." As for me, I'm not troubled by Joost's cynicism. I just don't share the idealism. For a next-generation platform, there's much that's awfully familiar about Joost.
For Jon Fine's blog on media and advertising, go to www.businessweek.com/innovate/FineOnMedia
By Jon Fine