Yahoo Buys Online Video-Editing Company

Online portal Yahoo has acquired Jumpcut, a San Francisco video-sharing start-up that offers consumers the ability to not only upload clips, but also to edit them online. Terms of the deal weren't disclosed.

Jumpcut, which launched in April, has done promotional deals with several entertainment companies, including Warner Bros., Starz Entertainment, Fox Atomic and New Line Cinema. For the initiatives, studios have made their own videos available and then invited consumers to use Jumpcut's editor to re-mix the clips by incorporating their own videos.

For instance, New Line Cinema is sponsoring a contest inviting users to create videos of their own worst nightmare using footage from "Friday the 13th." Because Jumpcut has a flash-based editor, users don't have to leave their browsers to create the mash-ups.

Earlier this summer, Jumpcut posted a trailer for the Warner Bros. film "A Scanner Darkly," and then offered users the chance to compete to make the best re-mix.

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Jumpcut will continue to reside on its own site, Jumpcut.com, but Yahoo also intends to integrate the feature into its other verticals, said Jason Zajac, vice president, general manager of Yahoo's Social Media Group.

Jumpcut recently was named one of the 10 best video-sharing sites by Light Reading, a telecom research company. "Like the hip-hop milieu in which its founders probably grew up, Jumpcut encourages users to take the old and the new, the self-made and the borrowed, and mash it all up to create a truly unique digital work," stated Light Reading in a report released last month.

Jumpcut founder Mike Folgner will stay with the company, as will the other 13 full-time employees, he said Wednesday.

The acquisition demonstrates that large online companies now consider it a priority to draw users that also produce content to their sites, said Joe Laszlo, a senior analyst with Jupiter Research. "There's almost more competition getting folks who create video than the people who watch video," he said.

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