"In these tough economic times, it's been increasingly challenging to operate as an independent, ad-supported online video platform," said Mike Volpi, CEO of Joost, who is stepping down as part of the reorganization.
Initially known as The Venice Project, Joost was founded by the same entrepreneurs -- Niklas Zennstrom and Janus Friis -- who brought the world Skype and Kazaa. Utilizing peer-to-peer networks, the highly anticipated startup launched in 2007 with top-tier content partners, including Viacom, Warner Music and Endemol -- a Dutch production company responsible for "Big Brother."
"After much analysis, we have decided to change our focus and to start providing white-label online video platforms for media companies and distributors," Volpi said. "We have built a solid technology platform that there is demand for in the marketplace, and look forward to this new chapter for our company."
"At the same time," Volpi added, "we'll continue to operate Joost.com and its associated video applications."
This technology and service offering will endeavor to support content owners' efforts to build branded environments online.
As a part of the restructuring process, a core team in New York and London will work on providing these solutions, as well as operating and supporting Joost.com and its associated video applications. A Joost spokeswomen declined to specify exactly how many of the company's more than 100 employees will be affected by the reorganization.
In Volpi's place, Matt Zelesko, currently SVP of engineering at Joost, will take over as CEO while continuing to lead the engineering organization. Not severing his ties completely, Volpi will remain as chairman of the board.
Stacey Seltzer, currently SVP of international business development and content acquisition at Joost, will run the business operations. Joost also announced plans to will wind down operations in its Leiden development center.
The news comes on the heels of new research from media analyst firm Screen Digest, which concludes that third-party platforms like Joost -- which have no direct vertical affiliation with major rights holders, or direct access to premium content rights -- will increasingly struggle to aggregate ad-supported movies and TV shows.