Kazaa, Skype….Venice?
July 25th, 2006 Posted in Main Page, VOIP Services, Competition/Skype, Web 2.0
News flash: Internet rebels Niklas Zennstrom and Janus Friis are apparently moving into the video business after wreacking havoc on the music and voice businesses. According to BusinessWeek, the dynamic duo are using some of their eBay dollars to develop video distribution technology code-named "The Venice Project" (which sounds like a film that Matt Damon would star in). I realize this is the year of video but is anyone doing anything other than video these days? Then again, it's hard to look at YouTube's 100-million video deliveries a day and not believe there's gold in them thar fields - especially when the company has apparently targeted $1-billion as its take-out price.
 The challenge facing most (all?) video start-ups, including YouTube, is turning all those downloads and streams into revenue. Sure, this is a theme I've hammered on before but you can't turn cool Web-based technology into a business without revenue. If you examine Zennstrom and Friis' entrepreneurial track record, Kazaa was not a business but a way to download music and video for free while driving the music industry crazy. Skype was on its way to becoming an interesting telecom business before eBay stepped in with a $4.1-billion takeover. As for "The Venice Project", your guess is as good as mine about its prospects. There's plenty of competition but Zennstrom and Friis has three major weapons in their arsenal: lots of personal cash, plenty of VCs likely chomping at the bit for a piece of the action, and the relationship with eBay. The big question facing Zennstrom, Friis and the boys over YouTube is whether they can attract another Skype-like mega-offer.
Update: Other signs of the video-craze include the launch of Dabble and Gotuit. John Battelle has a post on why YouTube isn't worth $1-billion.
 The challenge facing most (all?) video start-ups, including YouTube, is turning all those downloads and streams into revenue. Sure, this is a theme I've hammered on before but you can't turn cool Web-based technology into a business without revenue. If you examine Zennstrom and Friis' entrepreneurial track record, Kazaa was not a business but a way to download music and video for free while driving the music industry crazy. Skype was on its way to becoming an interesting telecom business before eBay stepped in with a $4.1-billion takeover. As for "The Venice Project", your guess is as good as mine about its prospects. There's plenty of competition but Zennstrom and Friis has three major weapons in their arsenal: lots of personal cash, plenty of VCs likely chomping at the bit for a piece of the action, and the relationship with eBay. The big question facing Zennstrom, Friis and the boys over YouTube is whether they can attract another Skype-like mega-offer.
Update: Other signs of the video-craze include the launch of Dabble and Gotuit. John Battelle has a post on why YouTube isn't worth $1-billion.
