InterActiveCorp gave up plans to establish a service for video on demand, which can compete with Netflix, Hulu and HBO, writes Bloomberg.
The service had to draw all over 200 million. On Vimeo users have to pay for exclusive content. Instead, now Vimeo will focus on tools to serve the experts in the film industry.
Vimeo “decided not to offer subscription-based service with original programming that was scheduled to start in 2018,” said spokesman Video service.
Creating a new paid video service could be something very expensive one full of players market, especially given the fact that Vimeo is up against more established companies with larger budgets.
Netflix will spend 6 billion dollars for programs this year. Amazon did spend about 4.5 billion dollars annually, according to some analysts.
Joey Levin, who is both IAC’s CEO and Vimeo’s interim boss said last year he planned to invest “tens of millions” of dollars into programs for the service at the request of the company, not “hundreds of millions”.
Initially the service was to be released later this year, but its launch was postponed in May. Then the company announced that it plans to postpone the first half of 2018 to allow more time for “best content,” explained Levine.
Moreover Vimeo wanted to compete for different viewers – those who have niche interests and seek more provocative content. There are dozens of services that charge people 5 to $ 15 a month for everything – from anime to religious programs.
At the end of the first quarter Vimeo has about 800 thousand. Subscribers who pay to use its instruments related to cinema.
“This was a difficult decision – the idea of pursuing an SVOD service for Vimeo has always been intriguing, and I would have loved to see the incredibly talented Alana Mayo’s programming vision realized here at Vimeo,” Joey Levin said in a statement. “She and her team are creative, sharp, risk-takers, and I believe will all, to a person, have an incredible future in programming. But the opportunity ahead for Vimeo to empower creators is too large and too important for us to attack with anything other than absolute focus and clarity.”