Arqiva to close online TV venture SeeSaw

The ill-fated video-on-demand venture sprang from the unsuccessful VoD initiative between BBC Worldwide, ITV and Channel 4's, known as Project Kangaroo, that was blocked by the Competition Commission in 2009.

The TV and radio transmitter company is believed to have spent in the region of £8m in acquiring the project’s assets in July 2009.

The decision to close SeeSaw, which generated 1.5m programme streams a month, follows the appointment of former interim chief executive of ITV, John Cresswell, as chief executive of Arqvia in January.

He appointed Ingenious Media to find an investment partner or buyer for the business after realising the VoD market dynamics had changed, with traditional broadcasters investing heavily into their own bespoke services.

SeeSaw claimed it had attracted more than 8m unique users to-date by the end of last month (April) and, according to ComScore data, the average user spends more than 30 mins on SeeSaw, compared to just over 10 minutes for 4oD, 4.1 minutes for Blinkbox, and 4.3 minutes for the BBC iPlayer.

However, SeeSaw’s traffic figures trail at around a tenth of that experienced by the revitalised 4oD and ITV Player, with both broadcasters keen to develop their own audiences further.

An Arqiva spokesman admitted: "The VoD market has changed and it was increasingly difficult for an aggregating service like SeeSaw to compete with the established brands."

The company placed 28 staff today into a 30-day consultation after informing them the company had failed to find an investor.

A statement posted on SeeSaw’s website said: "We're sad to announce that next month will be the end of the road for SeeSaw. Launched in February last year, SeeSaw has become a great place to watch TV for millions of UK viewers.

"However, following a strategic review of its business activities Arqiva, our parent company, is no longer able to support the service.

"As it will soon be ‘goodbye’ from SeeSaw, we’d like to take this opportunity to say a big ‘thanks’ for all your support, custom and loyalty over the last 16 months. We’re a small team but we hope we’ve made a big difference and that you’ve had fun watching TV with us."

Suranga Chandratillake, chief executive and founder of rival video search engine blinkx, said the closure of SeeSaw is the latest development in what is "quite a shakeup in online video". 

He told Media Week: "Despite eMarketer forecasting that the online video ad market will be worth $5.7 billion by 2014, its evident that, creating a profitable video streaming platform does not fit the traditional broadcast model.

"To be a success in this market, it’s not about creating walled gardens of exclusive content, it’s about embracing the fragmentation that is inherent with the world wide web.

"Unlike Joost or SeeSaw, the content channels that thrive in this environment, will be those that help users effortlessly navigate and locate rich video content on the web and allow content producers to engage to whatever degree they see fit."

This article was first published on mediaweek.co.uk