Is the ride over for SeeSaw?
By Kate Bulkley
For Broadcast September 01, 2011
Video site needs to sort out ownership - and fast, says Kate Bulkley.
Online video site Seesaw has (perhaps unsurprisingly, given its name) suffered from both ups and downs. This week the company appears to be on a down, which could prove to be its last move.
Channel 4 took down its content from the site several weeks ago and the Hollywood studios pulled their content in June because new contracts were not put in place. As of now, there is less than 1,000 hours of ad-supported content on the SeeSaw site, including some from the BBC and Channel 5, with the balance from independents.
The much-reduced SeeSaw staff are still waiting for the new investors to take over the funding of the company from former owner Arqiva, and as the 1 September deadline approaches, some are nervous that the deal to save SeeSaw won’t be completed.
The problem is that although a new investor group led by Criterion Capital of California was announced in July, it has taken longer than expected to get the funding together to buy the beleaguered website.
According to a Criterion Capital spokesman, the deal is “on track”, and although it has “come down to the wire”, everything should be fine.
But the site’s contracts will have to be renegotiated with the content providers, and clearly Criterion will have a more “start-up” approach to how it pays suppliers - they will want much more favourable terms.
Adam Levin, who heads up Criterion Capital and led the deal to buy SeeSaw, is also the man behind Criterion’s purchase of Bebo, the social networking site that had dwindled under the ownership of AOL.
Levin has a nose for a bargain where he can see upside and plans to bring in Michael Jackson, former BBC and Channel 4 bigwig, to be chairman of SeeSaw after Criterion takes control. The deal may well still go through - the investor group says it has just a few more Ts to cross before the new capital and management can kick in - but it is getting very tight.
In any case, the future of online content aggregators does not look good. The leader in the US, Hulu, had early success because its backers included several of the biggest broadcasters, but those same broadcasters are now wondering if the ad-supported online model is the right one, and if they want to “export” their precious content to an online aggregator at all. Maybe they want to keep their content on sites they control more directly.
Closer to home, Blinkbox was recently purchased by Tesco, a move that will have made its management happy because it will give the site access to a million Tesco Clubcard owners and a marketing machine that will help it gain traction with users.
In the end, online video is a huge growth area, especially as TVs and other devices are increasingly connected to the internet, with big companies like Google also eager to cash in on the internet video revolution.
However, it is all about size and retention of audience, and hopefully convincing them to pay for at least some of the content they view.
Criterion’s masterplan may be to link Bebo with SeeSaw - and it may also be playing a game of brinkmanship to get a better deal from Arqiva.
But whatever the plan, the first steps will need to be taken soon, or SeeSaw may have seen its last saw.