As it continues to expand its online video portfolio, Google has agreed to acquire Episodic, a San Francisco-based startup that offers a video-hosting platform and marketing and analytics services.
Episodic offers a hosting platform and publishing interface, allowing content creators to push their video media onto the Web or to mobile devices like the Apple iPhone. The firm offers a streaming service and an on-demand viewing model.
The company's co-founders, Noam Lovinsky and Matias Cudich, said that existing Episodic customers won't see any disruption in their service, though the company is not signing up any new accounts as it makes the transition to Google (NASDAQ: GOOG).
"Episodic and Google share a common vision for video on the Web," they said in a blog post announcing the acquisition. "Online video will be ubiquitous, engaging, entertaining, informative and effective. Both teams place value on creating a great experience for viewers and on delivering a powerful and flexible platform for publishers, marketers and advertisers of all kinds."
Episodic also offers a detailed analytics service, and it provides creators with the opportunity to monetize their content either through advertising or by putting their videos behind a pay wall and collecting credit card payments. With its self-serve ad tool, Episodic offers publishers control over the ads that appear in their content and the point at which a video breaks for mid-roll placements. New Tools for Marketing in Tandem with Web Video
Terms of the acquisition were not disclosed. Both companies' technology and personnel are expected to be folded into Google's YouTube division, which accounts for nearly 40 percent of Internet video traffic in the United States, according to comScore.
As it tinkers with its ad programs on YouTube, Google has been pitching the site as an engaging medium to spread a marketing message on the Web. For e-commerce vendors, YouTube can provide a platform for interactive, rich-media creative offering coupons, free trials or other promotions.
For Google, the challenges of effectively monetizing online video have dogged the company since it shelled out $1.65 billion for YouTube in October 2006. In the time since, Google has experimented with a variety of ad formats, explored paid content models and inked licensing deals with entertainment studios.
Episodic's co-founders have been working on their own solutions to the problem of monetizing online video, and said that their products and approach are "complementary" to Google's vision. They also noted that theirs remains a very youthful industry.
"At Episodic, we have always felt that these are the very early days of online video and that there is far more growth to be had," they said. "To put it in perspective, our industry is barely 15 years old. We've just received our learner's permit, we still can't drive without adult supervision and we're certainly not old enough to buy a drink ... legally."
For Google, the Episodic buy continues a recent string of acquisitions of smaller firms and startups focused on niche technologies. Last October, when the company reported solid third-quarter earnings, CEO Eric Schmidt told financial analysts that the economy was stabilizing and Google would again begin hiring and shopping for companies to acquire, predicting about one acquisition a month.
Google's running just ahead of that pace for 2010. Episodic is the fifth company Google has snapped up this year, following the purchases of Aardvark, a social media startup focused on search, the photo-editing site Picnik, reMail, a mobile e-mail client, and the online-collaboration service DocVerse.
The latest buy now comes just six weeks after Google closed the acquisition of video-compression firm On2 Technologies, putting an end to more than six months of protests and legal challenges from investors and shareholders, who ultimately swayed Google to increase its purchase price by $18 million.
Kenneth Corbin is an associate editor at InternetNews.com, the news service of Internet.com, the network for technology professionals.
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