VitalStream Inserts Eonstreams’ Technology Into Advertising Lineup

After five years in business, and approximately two years after Newman came on board, Eonstreams secured its first venture capital from a local VC firm Southern Appalachain Fund in early 2005. The VC group also received a board seat.

Eonstreams used the funds to expand its marketing and sales efforts in two directions. It opened a New York office and hired Donald Williams, a Harvard MBA, to head up its advertising sales activity. It also courted Denise Reiling, who had a strong track record in negotiating internet radio affiliate contracts, to fill the newly formed position of VP of Affiliate Relations.

In late 2005, at the board’s request, Eonstreams began to move further away from its hosting roots and toward exclusive focus on its ad insertion technology. To aid in this migration of streaming services, Eonstreams chose to move their delivery services to the VitalStream content delivery network.

In early 2006, several potential setbacks occurred. Clear Channel, which had a board seat, announced that it was launching its own homegrown ad insertion technology and forcing its stations to move off the Eonstreams technology. This eventually happened, although more slowly than Clear Channel anticipated, as the move was met with some resistance by key stations that had leveraged Eonstreams’ ad insertion tools to sell unique advertising bundles. Second, the company ran into several technical challenges regarding the move to the VitalStream network.

By February 2006, though, Eonstreams and VitalStream had surmounted the technical hurdles and the move was completed. Eonstreams began initial insertion of video ads into its audio streams, and the company also finalized a partnership with MediaSpan Online Services, a provider of digital content and website management for local newspapers and radio and television stations. The partnership allowed MediaSpan to sell Eonstreams’ ad insertion technology under the MediaSpan-branded AdSMART name.

For Eonstreams, this partnership met three primary goals. First, the company felt it validated Eonstreams’ ad insertion technology, as the deal with MediaSpan more than tripled the number of radio stations using it to almost 2,000. Second, the number of new stations more than offset the loss of the Clear Channel stations. Third, and most importantly, it allowed Eonstreams to reach the point where they could focus on selling advertising.

In essence, the company was positioned at essentially the same spot that HGTV was at almost two decades prior—it had reached a critical mass of consumers. MediaSpan shared this belief.

"Whether it is audio streaming, podcasting, or online display ads, our goal is to deliver new national revenue to our customers and the highest ROI for our advertisers," notes MediaSpan Network CMO Mark Zagorski. "Our partnership with Eonstreams allows us to take the next step in creating a higher value online network that reaches more people, in more places, and with more types of marketing tools, than any other."