Online Video Site, Joost, Cuts Back

Launched more than two years ago as “the world’s first broadcast-quality Internet television service,” Joost today announced a significant change in its business. Company CEO Mike Volpi is stepping down from the post at the online video start up to serve as chairman of the board. He said today that the company will shift to provide “while label” services for online video.

The company’s Joost.com portal will serve primarily as a showcase of the company’s technology. “We will continue to offer ad-supported programming on Joost.com,” Volpi said in his letter, “But while we are making our white label offering ready for commercial use, we’ll have fewer resources available for content operations, including content updates and refreshes.”

A copy of the letter is provided on page two.

Matt Zelesko, currently SVP of Engineering at Joost, has been named CEO with Stacey Seltzer, currently SVP of international business development and content acquisition at Joost, now running business operations.

Danny Passman and John Schultz, who joined Joost more than a year ago from DailyMotion as global head of programming strategy and director of programming strategy, respectively, are among those leaving the company.

Reporting on the move today, All Things Digital’s Peter Kafka wrote that Joost is laying off most of its employees.

“This isn’t a shock,” Kafka wrote, “Joost’s fate has been the subject of whisper and rumors for the last year or more. The service made an initial splash in 2007 by raising $45 million from the founders of Skype and an array of high-profile investors and media companies, including Sequoia Capital and Viacom (VIA), and was initially supposed to deliver copyrighted content via a peer-to-peer distribution system and a player that users downloaded to their desktops. But YouTube, and later Hulu, conditioned users to watch video via their browsers, and Joost’s software never caught on.”

—a letter from outgoing Joost CEO Mike Volpi is available on page two—

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