Sony acquires online video services firm for $65m

25 Aug 2006

Sony's entertainment unit agreed to pay $65 million to buy Web video-watching site, marking the growing embrace of the user-generated video craze by big media, a Reuters report said.

The Reuters report said California-based Grouper is one of a number of Web start-ups operating in the shadow of, the most popular destination for user-generated videos, which plays host to an average 100 million video showings a day.

Grouper has attracted a following of millions of its own fans not just as passive viewers of Web-based videos but also as creators of their own videos, which can in turn be shared by users or downloaded to portable video-playing devices, the report said.

The Reuters report said the acquisition by Sony Pictures Entertainment (SPE), the Hollywood movie and television production unit of Japan's Sony, aims to infuse the studios with new ideas and talent for movies, television shows and games, according to Sony's top executive.

The Reuters report quoted Michael Lynton, Sony Pictures chairman and CEO as saying that user-generated content as a complement to professionally produced media has been a hot topic within Sony's different businesses for more than a year.

Sites like Grouper give big media companies like Sony a ready-made network to deliver both Hollywood produced content and niche-market consumer-created videos using viral distribution where users share favorite items with friends, the report further said.

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