IPTV company Joost quietly made their first acquisition earlier this week (at least quietly relatively the hype that usually surrounds them.) Joost bought digital programming guide OnTheToob.com (and with it, its developer). Terms were not disclosed but the likely cost was trivial.
OnTheToob developed RSS feeds and channel guide interfaces built around the Joost platform. The company, which was not much more than a personal project, had been working with Joost since April. As part of the deal, the creator of the technology will join Joost as an employee.
An early stage startup acquiring another for its technology (or its staff) is not a natural occurrence but with $45m in financing and a high profile CEO with a background in technology acquisitions, it’s a natural fit for Joost.
IPTV is an industry in its infancy, but one predicted to be a huge market opportunity. In addition to big media, companies like Veoh, Babelgum, and Joost are all vying for control. The competition is fierce. War chests are also overflowing. Representative companies have received extremely heavy investment. In this climate, acquiring technology, and the time advantage of not having to develop it in house from scratch, could prove a valuable strategy and bring a much needed competitive advantage.
To that end, on August 30, Joost also opened up their programming API to allow 3rd party developers to create “widgets” that can be installed and used inside the service. It seems the hope, and plan, is to get as much outside (and free) development as possible before ending their extended Beta.
Considering they probably paid less for OntheToob than they’d have spent in a retained search through a headhunting firm, it might be a reasonable gamble to think this little acquisition could be the first of many.
[Joost is still invitation only. If you're anxious to try it, send me an email from the contact me page and mention you'd like one. I'm happy to extend invitations as time allows]