Google bought YouTube for $1.6 billion four years ago, but despite being the biggest video viewing website in the world it has yet to generate real profit.
"I believe they'll cross the bar next year," says John Goldman, Qlipso CEO. While Google uses advertisements, Qlipso takes a different approach by creating personally adapted enviroments for each surfer.
The company has developed the technology to create a private online viewing room where each surfer can invite friends. Each user who enters the platform is given an avatar and can perform various functions such as introducing himself through his webcam etc.
Qlipso employs 25 workers mostly specializing in the RD field and based in Jerusalem as well as sales and marketing staff in the United States.
Digital world imitating real world
The company is currently focusing its energies in the video field, however Goldman says that its technology can lend itself to other types of content. "What's happening in the real world will make it to the digital world," he says. "Instead of watching a TV program with friends you can watch it on an internet website. In the same way, one can play games, share songs etc."
The plan is that profits will come from the personal adjustment of the avatars, the rooms and camera effects. "The virtual merchandise market generates $1.6 billion in the US alone which will reach
$2 billion by 2011," Goldman says.
"Games are usually popular for a few months until they fade out, but video and music content is always changing. We can give surfers points for watching videos, inviting friends or uploading content and with these points and an additional fee they can purchase other functions."
Qlipso was founded in 2007 by Yishai Pnueli and is being funded by the JVP venture capital fund.
In March 2010, the company purchased veoh.com, a video portal which previously aimed to compete with YouTube. "The point of the acquisition is to reach the already existing audience in the website," Uri Adoni of JVP explains. "Veoh has 14 million users and it gave the company a chance to grow in one go."
Goldman says that the purchase is already proving fruitful. "Video viewing time doubled from 10 to 20 minutes after the private rooms were introduced. In the future we'll be able to keep surfers for longer – an additional 10 minutes for games, 20 minutes for conversation, file sharing etc."
He says that six months ago the company did not generate any revenue but that now it's earning millions of dollars.
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