Consolidation in the Streaming Media Sectors

Digitalsmiths Acquires Gotuit

We cover this one in more detail in the “Going 

Meta” article (pp. 46–48), but it’s worth noting that Digitalsmiths has a master strategy that led it to acquire a complementary competitor, one it had competed against in the Streaming Media Readers’ Choice Awards. Gotuit handles news and sports, while Digitalsmiths focuses on film and episodic television. Expect more news from Digitalsmiths in 2011, as it continues to move forward on its overall strategy.

Google Acquires Episodic

Hot on the heels of Google’s first publicly traded acquisition, On2, which we’ll cover next, Google returned to its roots of buying privately held companies. In early April, Episodic announced it had been acquired by Google. 

The Episodic team joined Google to focus on a holistic approach to video delivery consistency across multiple platforms: web, mobile phones, and IPTV devices. The latter is important in that it plays into the potential strengths of Google TV, should Google ever succeed in pushing the nascent set-top box and TV-integrated platform beyond just a few klutzy early adoption products.

Episodic had a history of being able to aid the delivery of online video to mobile devices, including the big three mobile device platforms: iPhone, BlackBerry, and Windows Mobile. This expertise is also sure to help Google as it looks to grow the media capabilities of its Android mobile platform.

Google Closes On2 Deal

This acquisition, to say the least, was contentious. Google faced shareholder discontent with the purchase price it offered to On2, for a variety of stated reasons, and ultimately raised its offering price after its own stock had a positive run over the months between the intention announcement and the shareholder meeting to vote—or meetings: It took several attempts to seal the deal.

We’ve all speculated on Google’s motive for the On2 acquisition, but it’s now clear that it was about the codecs (VP6, VP7, and VP8) and not about the products, as Google announced in late December that it was shutting down the last remaining product, Flix Engine. Mike Savello, who led sales for On2 and transitioned into a role as an evangelist at Google, had left the company a few weeks prior to join LiveU.

Just prior to the end-of-life announcement for Flix Engine, Zencoder announced that Flix Cloud had been integrated into its own cloud-based transcoding product. 

“On November 15, 2010, Flix Cloud finished merging into Zencoder and was shut down,” the Zencoder team announced, adding, “Zencoder is the team behind the original Flix Cloud application. We worked hard with Google to ensure that Flix Cloud customers could transition smoothly to a comparable service. What’s more, Zencoder is a major improvement over Flix Cloud. Zencoder is significantly faster, offers a better interface, enables more options, accepts more codecs, and even provides better quality encoding.”