Does Sony Pictures Entertainment (SPE) have a grand plan to get a measurable return on its $65 million acquisition of online video sharing “community” Grouper?
SPE puts forth diverse “reasons” for its acquistion of the YouTube like free-to-consumer online video service:
1) Consumers are spending more and more time on sites like Grouper, and as one of the world’s largest creators of entertainment, we want to be where the audiences are. This acquisition demonstrates the breadth of involvement of Sony Corporation in the field of digital online entertainment.
2) Many people in the Grouper community use Sony cameras to create videos and Sony VAIO computers and mobile devices to store and view them. It makes sense to complete the circle by having Grouper be a part of Sony Pictures Entertainment, which itself creates so much content for people around the world.
Grouper describes its “strategic” value to SONY:
Grouper’s primary mission is to give its users the flexibility to take their videos with them across site and platform. Grouper users can browse videos and easily post them to a wide variety of third-party Web sites, such as their personal pages on MySpace, Blogger and Friendster. Grouper’s portability is anchored by its robust peer-to-peer video sharing network, which facilitates downloads of high quality uncut original video shared by its members. Its users can download from Grouper.com to connected mobile devices like the PSP and iPod. Grouper also provides members with easy-to-use video editing tools so that videos can be quickly uploaded from cameras, camcorders and webcams.
Tangible metrics on the privately help Grouper are minimal:
Monetization: Google AdSense Usage: 8 million monthly uniques (self-reported ) VC Funding: $5.25 million
Michael Lynton, SPE Chairman and Chief Executive Officer characterizes the acquisition of Grouper as a:
strategic initiative in the field of digital entertainment and consistent with Sony Pictures’ vision of making entertainment accessible to consumers whenever, wherever and however they want.
Lynton does not appear to be expecting a payback from the “strategic initiative” in the short term:
No immediate changes are planned for the site. Over time, there is potential for development of ad-supported and premium content businesses. ‘Grouper gives us a strong platform for growth.’
Lynton, however, may be spending more time at Grouper, himself:
It’s like a virtual, global audition, and a great source of entertainment.