New, Improved Joost Will Launch This Week

Web-TV Service Does Away With Download, Adds Community Features

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NEW YORK (AdAge.com) -- Get ready for Joost 2.0.

The web-TV firm is opening the doors on a site tomorrow that it hopes will give the once pioneering start-up a new lease on life.

The latest Joost does away with the balky download that plagued the first version of the service, in favor of an offering that works in any standard web browser.

It's a reinvention of the service, founded in 2007 with content and investment from CBS and Viacom, and advertising support from T-Mobile, Wrigley's, Phillips, Maybelline, Coca-Cola, Intel and Nike. Joost was received with much fanfare, but its founders, Skype and Kazaa inventors Niklas Zennstrom and Janus Friis, had made one near-fatal mistake. Like their other two hit start-ups, they built Joost on peer-to-peer architecture, which required a software download to use.

Too many issues
"The pedigree of the people who launched Joost gave us high hopes, but it was plagued with many more issues than their previous track records would suggest," said David Cohen, senior VP, Universal McCann Interactive, part of Interpublic Group of Cos.

Needless to say, consumers were reluctant, and the software didn't work very well. In the meantime, web-based services such as YouTube, Hulu, Veoh and myriad network-TV sites were built to work within a web browser, or in the case of ABC.com, with a small browser plug-in.

Fortunately, the company raised $45 million, enough cash to spend much of the past year reinventing itself.

New features
In addition to an easier-to-use player, Joost is adding community features such as commenting, and "JoostFeed," which allows users to keep track of what their friends are watching.

"People have always relied on their friends' recommendations to figure out which movies they want to watch, or talked about their favorite TV shows and moments with friends," said CEO Mike Volpi in a statement.

When Joost launched 18 months ago it was competing against mostly illegal peer-to-peer download services, but in the past year a fairly robust market has grown around web TV.

A recent survey by Integrated Media Measurement found that nearly two-thirds of those who watched Tina Fey's "Saturday Night Live" spoof of Sarah Palin, for example, did so online or on a DVR.

Challenges ahead
Joost has a formidable competitor now in Hulu, a top 10 video site, and Veoh, which has similar content deals. Joost's biggest content partners are still CBS and Viacom, and it added Warner Bros. TV last spring.

It also labors under difficult economics. For example, Joost keeps only 10% of the ad revenue generated by CBS content, a smaller cut than the 20%-30% that Hulu, NBC and News Corp.'s joint venture, keeps from its content partners.

Further, TV is becoming ubiquitous on the web. CBS just did a distribution deal with YouTube that included full-length episodes of "MacGyver," "Star Trek," the original "Beverly Hills 90210,"and the season premieres of Showtime's "Dexter" and "Californication" on the site.
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