Pioneering video streaming site Joost has announced that it is leaving the arena of consumer-oriented advertising-supported video and will concentrate on providing services to other companies that wish to provide online video.  Founded by Niklas Zennstom and Janus Friis, who created Skype and Kazaa, Joost initially used a BitTorrent-like peer-to-peer system that delivered high quality video but required the downloading of a clunky player.  

When it was founded in 2006 Joost was the first Web company to sign online distribution deals with big media companies (CBS and Viacom) and it attracted more than $45 million in investment.  But in the words of Advertising Age, both Joost and the Michael Eisner-backed Veoh (which has already given up online ad-supported streaming) were “blindsided by Hulu, which was backed by NBC Universal, News Corp. and, more recently, Disney. Hulu has both a far superior catalog of premium video and has gathered up much of the available ad spending in the premium-video space.”

Although it has also been eclipsed in the anime arena by Crunchyroll, Joost was one of the first online sites to provide streaming of anime series (see “Funimation Launches on Joost”), and in addition to Funimation, Joost also hosted series from Viz Media, ADV, and Toei.

In its new incarnation as a technology services provider Joost will shed some 70 of its 90 employees.