Rocketboom, the daily video blog, is turning over its distribution and ad sales to Sony Pictures Television in return for a seven-figure guarantee plus a share of revenues. Rocketboom will be distributed on Sony’s Crackle video site, as well as across other Sony platforms such as the PS3, PSP, and Bravia I-Link TVs.
Rocketboom founder Andrew Baron says he went with Sony because of Sony’s distribution strengths and the deal allows him to maintain control of the business. (Whereas selling the business to another media buyer, such as WallStrip did to CBS a year ago for $5 million, would have required him to give up his baby). The deal is structured as a distribution and advertising deal, and sounds like it could lead to a closer relationship or outright sale if things go well. But if they don’t, Rocketboom would regain complete control of distribution and ad sales after the contract expires.
Rocketboom’s current distribution through YouTube, iTunes, Tivo, and elsewhere will remain intact. Sony will sell ads across those distribution channels as well. Baron claims more than Rocketboom is watched more than one million times a month across all channels, and sometimes spike to several million views. But as one of the first Web video shows, Rocketboom has always been better at creating videos than at selling ads.
By aligning with a major media company, Rocketboom will be able to expand its reach and Baron will be able to take some money off the table. But Rocketboom will now be seen as a Sony property for all intents and purposes. That is not necessarily a bad thing. For instance, Crackle is finally starting to see some growth after going nowhere for a long time. Since April, according to comScore, unique U.S. visitors to Crackle.com has tripled to 3.7 million (compared to 4.5 million U.S. visitors to Veoh.com).
The deal does raise the question, though, of whether Web video startups can thrive as independent entities or require the distribution muscle of a major media company to go mainstream.
Update: In a blog post about the deal, Andrew Baron explains that one reason he went with Sony is that previous ad partnerships with smaller companies didn’t work:
We tried start-up ad companies like Federated Media and blip.tv and refused to go exclusive with anyone for a long term without some kind of guarantee. And no one was ready because no one could sell out our inventory across all of our platforms (e.g. our own video formats plus videos on You-Tube and TiVo, etc.). It tends to require managing multiple accounts and methods and no one has been able to handle selling ads across all of our platforms except us.
He also blames a lawsuit with former Rocketboom anchor Amanda Congdon for tying up the company for two years. While other Web video startups, such as Revison3 and Next New Networks, raised tens of millions of dollars, Rocketboom was “frozen like ice” by the courts.
i just checked this site. now i know we’re in a bubble
Good
http://www.rybao.com
Congrats Andrew and the entire Rocketboom team, this is phenomenal news! Kudos to the smart folks at Sony for recognizing this diamond and working out a deal.
Looking forward to seeing great things from this partnership!
Eli
Well congratulations to the Rocketboom team! That’s totally awesome, there are some really creative people over there. I know I’ve said I found the show boring before, but as soon as I said that I went back and watched it some more and changed my mind. Epic Fu is next, right?
Inspiring. I just checked the average worldwide website traffic of the given example of crackle.com and veoh.com on trends.google.com and it shows a very different picture than shown in this blog. According to trends , Veoh.com has around 1.4 million unique visitros / month. Altough crackle.com had around 60 thousands uniquie visitors in march but it has dropped to 30 thousnads from april onwards. The source is from trends.google.com.
Very cool, I love things that go boom.
“The deal does raise the question, though, of whether Web video startups can thrive as independent entities or require the distribution muscle of a major media company to go mainstream.”
Not sure it does. I think it indicates success that MSM would even consider this (nevermind with such a huge up front).
Also, this is standard media evolution: networks to exclusive repping to internal sales. Following this path allows media companies to focus on what they do best. Sugar did it with NBC, you guys are doing it with Federated. It’s very standard, but also very healthy.
@Malik Aleem Ahmed:
I am pretty sure that Sony would have shut down Crackle.com if they were only getting 30K uniques a month. Just goes to show how innaccurate these free traffic tools are.
http://pop17.tu...-deal-with-sony
@Jeremy Wright, I agree to disagree with you. It is healthy up to a certain point. Working with Federated or an ad agency such a as Sony isn’t always the best way to be profitable for most blogs and video blogs. One sponsorship sold alone can be enough for a web show.
It’s a strong partnership for Rocketboom if Sony sells the ads on top of the distribution deal. This is very exciting.
@Sarah – Sorry if I wasn’t clear, but I meant it’s a healthy evolution. I wasn’t advocating any particular agency, just that VERY few media companies go from ad networks to an internal sales team effectively without some kind of middle step (like a repping/exclusive relationship).
I agree with Jeremy what he is saying. And how would you know, you aren’t in the business long enough to know anyways. Sorry, If I come of rude but I just think that sometimes people do need to be longer in business to talk about stuff then only reading from tech sites.
They need to get rid of that cheap looking world map as the background and use some real video editing software.
Wrong. They just need to get a really expensive world map instead.
Are there companies like Sony or Federated that can look at a web video or audio show and, despite it having low traffic, will pick it up and partner with it due to the possibility of it being a hit?
@ Lady Raptastic
Disney is on a buying spree these days.
Does Amanda still own 49%.
This article makes it sound like acquisition was an option. Was it? Its a right fit for Sony’s audience – there’s not a lot of true TV play for techie shows. Try to think of a single one that’s on a major network, but this makes sense. Small, early adopter audience, but it’s a nice deal for Rocketboom. I think the company’s founder/CEO has a lot of smart sense.
I don’t anticipate a big market in Hollywood for techie type shows. Silicon Valley start ups interested in making the move should consider other niches instead.
Nice! Congrats!
Congrats Drew!!!! Smart move and well deserved.
great move andrew. about time you did something to increase the quality of your show. it has been stinky lately. no its been sucky. people think that you pioneered because you were lucky. if you don’t do something creative now i think that that will be true.
please show people that you have talent not some shallow, lame, woody allen wantabee.
Good to see an online video classic is still kicking. Honestly, I had no idea RocketBoom was still relevant after the talent that was Amanda left.
By the way that Total Unique Stats are TOTALLY wrong.
My visitors visited veoh over 15.200 times. so it is impossible for Total Unique visitors to be 4000+ for veoh.
Sorry I don’t get it….
@zato: Good question! Did Amanda Congdon get any of that cabbage?
inquiring minds want to know.
Well that’s good news and I’m next
Thanks for the awesome information
Is that chick single?;)