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September 28, 2006

Yahoo! Broadens It's Social Networking with Jumpcut Acquisition

By Li Evans

Yahoojumpcut_1 Jumpcut, a video creating, uploading and sharing community started in June of 2005 announced that it had been acquired by Yahoo! yesterday.

In a time where everyone is wondering who is going to buy YouTube - a similar type of video service - this acquisition is a much better deal for Yahoo!  Strategically speaking, this just makes a whole lot more sense in Yahoo's ever expanding Social Media kingdom.  But, one might wonder "Why not go after YouTube?"

YouTube is on the lips of everyone right now, it has tons of recognition and that could give Yahoo! the added boost it needs - but honestly, there are a lot of things inherently wrong with only thinking about the "instant" boost, here's the two most prevelant. 

  • YouTube's fast growth.  Although amazing by any standards, this type of growth came too soon before anyone could figure out how to monetize it.  If anyone tries to monetize this service now, it's going to spell death for the service - users would drop off the moment their "free" service isn't so "free" anymore.
  • It is only a "sharing" service, so its appeal can be quite limiting.

Jumpcut is a better deal for Yahoo! because, not only can you share videos, but users can create them too.  While all the emphasis and craziness has gone to YouTube - not to mention skyrocketing costs (bandwidth, server storage) because of all the attention, Jumpcut has been quietly building its base of core, dedicated users (customer evangelists), on which Yahoo! can build.

Yahoo!'s also getting an extremely well educated team to help propel this video search/create/share networking service into the main stream.  This service could quite possibly give YouTube some serious competition in this area of social media networking, with the right marketing, message and backing - something Yahoo's bound to infuse into the team.

Yahoo's just planted another stake in the ground of the social media space, it is going to be interesting to watch what happens in the next year.

sniff it

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This story takes a look at the recent acquisition of Jumpcut by Yahoo! and how it is a better deal than a YouTube acquisition. [Read More]

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