Justin.tv was a website that enabled anyone to broadcast online video on a personalized user account, otherwise known as a channel.
It was created in 2007 by Justin Kan, Emmett Shear, Michael Siebel, and Kyle Vogt, initially as a way for Kan to broadcast his life 24/7.
Thanks in part to users who broadcasted live sport on the platform, Justin.tv more than tripled its user base to reach 21 million by October 2009.
Less than two years later, however, Justin.tv became part of a new site called Twitch and the brand was officially shut down in August 2014.
Aspect
Description
Founding and Live Streaming
Justin.tv was founded in 2007 by Justin Kan, Emmett Shear, Michael Seibel, and Kyle Vogt. It started as a live streaming platform where Justin Kan broadcasted his life 24/7 through a camera attached to his head. The platform gained attention for its unique concept of live streaming personal experiences.
Expansion into Various Channels
As Justin.tv gained popularity, it allowed users to create their channels and live stream their own content. The platform hosted a wide range of channels, including gaming, entertainment, sports, and more. It became a pioneer in live streaming before the rise of dedicated gaming platforms.
Twitch.tv Spin-Off
One of the channels on Justin.tv, called Twitch.tv, focused exclusively on video game live streaming and esports content. Twitch.tv gained immense popularity among gamers and developed a dedicated community. In 2011, Justin.tv rebranded as Twitch Interactive, highlighting the success of the gaming-focused platform.
Rapid Growth of Twitch
Twitch.tv experienced explosive growth as a dedicated gaming live streaming platform. It became the go-to destination for gamers and esports enthusiasts to watch and interact with their favorite streamers and tournaments.
Acquisition by Amazon
In 2014, Amazon acquired Twitch Interactive (formerly Justin.tv) for approximately $970 million in cash. The acquisition allowed Amazon to enter the gaming and live streaming space and bolster its presence in the online video industry.
Integration with Amazon
Under Amazon’s ownership, Twitch continued to thrive as the leading platform for gaming and esports live streaming. Amazon Prime subscribers gained access to certain Twitch perks, further integrating the platform into Amazon’s ecosystem.
Diverse Content and Creative Categories
Over time, Twitch expanded beyond gaming to include a wide variety of content categories, including music, art, cooking, and “Just Chatting” streams. This diversification broadened Twitch’s appeal and user base.
Challenges and Controversies
While Twitch remained a dominant platform, it faced challenges related to content moderation, copyright issues, and controversies surrounding some streamers’ behavior. These challenges highlighted the complexities of managing a large and diverse live streaming community.
Kan, Shear, and Siebel met at Yale University and instantly became friends, but it was Kan who always wanted to start his own business. At some point, a mutual friend introduced Kan to Y Combinator founder Paul Graham who was on the lookout for tech start-ups to fund in Yale’s computer science department.
Graham initially invested in a calendar app Kan developed called Kiko, but after two updates, it was made redundant after Google released its own version.
Kan managed to sell the app on eBay for $258,000, which impressed Graham to the point where he wondered if he and Shear had any other ideas in the pipeline.
As it turned out, the pair did have an idea. Around the same time that Kiko was sold in August 2006, YouTube was released to the public. Kan and Shear were inspired by YouTube and wanted to build a platform where anyone could create their own live cast.
Justin.tv is founded
Kan and Shear then recruited Siebel and Vogt with the team moving into a small San Francisco apartment. Developing the concept proved difficult in the 2000s.
For one, it was very expensive to host and upload videos. What’s more, the phones of the era did not possess cameras and could not connect to the internet in any case.
Funded by a Y Combinator investment, Vogt engineered a solution involving an analog camera connected to a PC that was itself connected to the internet.
He also used Amazon EC2 to make reduce the cost of streaming content. Justin.tv was launched on March 19, 2007, with thousands of users attracted to the platform out of curiosity for Kan’s 24/7 stream.
Illegal content
After a while, Kan found it difficult to continuously create new material and the number of users on the platform at any given time started to drop.
The founders thus decided to pivot toward a platform where users could live stream whatever they wanted.
To finance this pivot, Justin.tv raised $8.38 million from the likes of Alsop Louie Partners and Bessemer Venture Partners.
Illegal content
Much of the platform’s early success can be attributed to users who broadcasted sports matches without a license to do so.
Traffic spiked appreciably on the weekends, particularly during football season and events such as the NCAA basketball tournament.
Inevitably, this attracted the attention of official broadcasters, with Siebel called to testify at a hearing into sports piracy in late 2009.
He noted that while Justin.tv took steps to remove pirated content when a complaint was made, it was unrealistic to expect site administrators to monitor every single account.
Such was the influence of Justin.tv that it also attracted the ire of sports broadcasters in the United Kingdom and Australia
After the UFC and a boxing promoter filed lawsuits, the company made a more concerted effort to remove illegal broadcasts.
Traffic then plummeted by as much as 20% in 2010, representing a drop of approximately 5 million users.
One user noted that ”Justin.tv is basically unusable at this point.”
To compound the problem, Justin.tv’s association with pirated material made it difficult to attract serious investment capital.
To help it navigate the various legal issues it faced, the team hired Eric Goldman, director of the High Tech Law Institute at Santa Clare University in an advisory capacity.
One of his first jobs was to deal with a subpoena issued by the UFC after the continued illegal broadcast of content by Justin.tv streamers.
Pivot to gaming
Around 2011, the Justin.tv co-founders had a stagnant business with no real purpose.
However, the lawless nature of the platform and the freedom it afforded users had resulted in the formation of a passionate video game streaming niche.
The platform’s recent release as an app also resulted in an additional two million users.
At the time, Kan disliked the niche because it required a lot of bandwidth and he didn’t understand why users would want to spend their time watching others play video games.
But irrespective of Kan’s grievances, traffic data suggested this was exactly what Justin.tv users were doing.
Emmett Shear, himself a gamer, noted that with some added features and embedded advertising, the niche had the potential to become profitable.
Twitch
The video game category from Justin.tv was then spun out to a new site called Twitch in June 2011.
Twitch was so popular three years later that the entire company became known as Twitch Interactive and the Justin.tv brand was formally retired soon after.
Former Justin.tv COO Justin Lin also stressed that community input has been vital in the development of the new platform’s functionality and features. In essence, the development’s focus was on tools that could enable games to become professionals in their sport.
At the time, the deal was the largest in Amazon’s two-decade history and enabled it to benefit from the rapid growth in the gaming industry alongside Apple and Google.
Key takeaways:
Justin.tv was a website that enabled anyone to broadcast online video from a personalized user account. It was created by Justin Kan, Emmett Shear, Michael Siebel, and Kyle Vogt in 2007 as a way for users to broadcast their daily lives.
Justin.tv was an instant success thanks mostly due to users who illegally streamed sports matches. When the company was sued for broadcasting pirated material, traffic dropped and growth stagnated.
Justin.tv then pivoted to video game streaming after the co-founders noticed it was starting to become popular with users. The niche was then spun out into a website called Twitch that eventually became the company’s sole focus. The Justin.tv brand was formally retired in August 2014.
Quick Timeline
Year
Event
Description
2007
Founding of Justin.tv by Justin Kan, Emmett Shear, Michael Seibel, and Kyle Vogt.
Justin.tv is launched as a platform for users to broadcast online video from personalized user accounts, allowing individuals to share their daily lives and experiences through live streaming. The platform gains attention for its unique concept and attracts thousands of users interested in broadcasting and watching live video content.
2007-09
Expansion of user base through diverse content and illegal sports streaming.
Justin.tv experiences rapid growth, more than tripling its user base to 21 million by October 2009. The platform’s popularity is fueled in part by users who broadcast live sports matches without proper licenses, attracting significant traffic during sports events. However, the platform faces challenges related to hosting illegal content and navigating legal issues with sports broadcasters.
2009
Introduction of live streaming niche for video games.
Justin.tv observes a passionate niche emerging for video game live streaming among its user base. The popularity of gaming content on the platform leads to the realization of its potential for profitability and growth.
2011
Launch of Twitch.tv as a dedicated gaming live streaming platform.
The video game live streaming category on Justin.tv is spun out into a separate platform called Twitch.tv in June 2011. Twitch focuses exclusively on video game live streaming and esports content, catering to the growing demand from gamers and esports enthusiasts. The launch of Twitch marks a significant milestone in the evolution of the platform and sets the stage for its remarkable growth.
2014
Acquisition of Twitch Interactive (formerly Justin.tv) by Amazon for $970 million.
Amazon acquires Twitch Interactive, the parent company of Twitch.tv, for approximately $970 million in cash in August 2014. The acquisition allows Amazon to enter the gaming and live streaming space and leverage Twitch’s growing user base and community engagement. The deal represents the largest acquisition in Amazon’s history at the time and underscores the company’s strategic focus on expanding its digital services portfolio.
Present
Continued growth, focus on gaming, and integration with Amazon ecosystem.
Twitch continues to thrive as the leading platform for gaming and esports live streaming, with a strong focus on community engagement and content creation. Amazon integrates Twitch into its ecosystem, offering benefits to Amazon Prime subscribers and leveraging Twitch’s popularity in the gaming industry. The platform remains a hub for gamers, content creators, and esports enthusiasts worldwide.
Justin.tv Creation and Early Success:
Justin.tv was founded in 2007 by Justin Kan, Emmett Shear, Michael Siebel, and Kyle Vogt, initially as a way for Kan to broadcast his life 24/7.
The platform attracted thousands of users, tripling its user base to 21 million by October 2009.
Illegal sports streaming played a significant role in the platform’s early success, drawing traffic spikes during sports events.
Challenges with Illegal Content and Traffic Decline:
Users began live streaming various content, including illegal sports matches without proper licenses.
The platform faced legal issues and took measures to remove pirated content, resulting in a significant drop in traffic and user base.
Pivot to Gaming and Formation of Twitch:
A passionate video game streaming niche emerged on Justin.tv, leading to the formation of a dedicated site called Twitch in June 2011.
The gaming category became highly popular and profitable with the addition of features and embedded advertising.
Twitch’s Success and Acquisition by Amazon:
Twitch’s growth was remarkable, leading to the entire company becoming Twitch Interactive, and the Justin.tv brand was retired in 2014.
In August 2014, Amazon acquired Twitch for $970 million in cash, becoming the largest deal in Amazon’s history at the time.
Focus on Gaming and Community Input:
Twitch focused on providing tools for gamers to become professionals in their sport, considering community input for platform development.
The acquisition allowed Amazon to benefit from the rapid growth of the gaming industry, alongside companies like Apple and Google.
WeWork is a commercial real estate company providing shared workspaces for tech start-ups and other enterprise services. It was founded by Adam Neumann and Miguel McKelvey in 2010. WeWork’s business model was built on complex arrangements between the company and its landlords. There were also several conflicts of interest between Neumann and WeWork, which provided the impetus for the failed IPO and significant devaluation that would follow.
Netscape – or Netscape Communications Corporation – was a computer services company best known for its web browser. The company was founded in 1994 by Marc Andreessen and James H. Clark as one of the internet’s first and most important start-ups. The Netscape Navigator web browser was released in 1995 and became the browser of choice for the users of the time. By November 1998, it had been acquired by AOL, which tried unsuccessfully to revive the popularity of the web browser. Ten years later, Netscape was shut down entirely.
Musically, or Musical.ly as it is officially known, was a Chinese social media platform headquartered in Shanghai. After passing 200 million users in May 2017, the platform was shut down by tech company ByteDance in November. After its acquisition, ByteDance suggested Musical.ly would continue to operate as a standalone platform. Company representatives noted that it would be able to leverage ByteDance’s AI technology and enormous reach in the Chinese market. Musically was ultimately absorbed into TikTok in June 2018, with the app no longer available in August of the same year. Existing users were offered technical support and several new features as a sweetener.
Vine was an American video social networking platform with a focus on looping video clips of six seconds in length, founded by Dom Hofmann, Rus Yusupov, and Colin Kroll in 2012 to help people capture casual moments in their lives and share them with their friends. Vine went on to become a massively popular platform. Yet by 2016, Twitter discontinued the mobile app, allowing users to view or download content on the Vine website. It then announced a reconfigured app allowing creators to share content to a connected Twitter account only. This marked the end of Vine.
CNN Plus was a video streaming service and offshoot of CNN’s cable TV news network that was launched on March 29, 2022. The service was ultimately shut down just one month after it was launched. Trouble began for the platform when parent company WarnerMedia merged with Discovery. The latter was unimpressed with paltry viewer data and, with $55 billion in debt to clear, was not interested in funding CNN+ moving forward. Other contributing factors to CNN Plus’s demise include a lack of compelling content and streaming service market saturation.
Clubhouse is a social app that allows thousands of people to communicate with each other in audio chat rooms. At one point, the company was worth $4 billion and boasted users such as Mark Zuckerberg and Elon Musk. Clubhouse declined because it rode the wave of pandemic lockdowns and suffered when people resumed their normal routines. The decision to remove the invite-only feature also caused a rapid influx of new members and removed any exclusivity. Clubhouse management also failed to define a business model and was unaware of the components of a successful social media site.
Carvana is an American online used car retailer headquartered in Tempe, Arizona. The company – which sells cars in unique vending machines – was the fastest-growing used vehicle retailer in the United States, with revenue of $3.94 billion in 2019. Yet by 2022, on $12.8 billion in revenue, the company reported almost $2.9 billion in net losses.
Houseparty was an app-based group video chat platform for mobile and desktop. Released in February 2016, the platform rapidly grew to hundreds of millions of users and was the #1 social app in 82 countries by May 2020. Less than 18 months later, however, owner Epic Games announced that it would be shutting down the app in October 2021. Let’s explain the reasons for Houseparty’s demise below.
ChaCha was a human-guided search engine founded in 2006. The platform provided a valuable service at a time when traditional search engine algorithms were unreliable and less developed.
When algorithms did become sufficiently developed, they provided answers to questions for free and much more rapidly than ChaCha could. The ChaCha business model was also unscalable, with employees overworked as the company tried to stay ahead of innovation.
ChaCha’s demise was also compounded by the smartphone, which provided another avenue for consumers to find information. A belated attempt to restructure and cut costs followed, but the company could not service its debt past 2016.
RadioShack is an American electronics retailer founded by brothers Milton and Theodore Deutschmann in 1921. The company enjoyed market dominance in the 70s and 80s but faded fast after a slew of missed opportunities.
RadioShack operated over four thousand stores in the USA, but many were placed too close together which caused sales cannibalization. These stores were also often small and had a confusing inventory mix.
RadioShack sold the first mass-produced personal computer with much success. However, the company saw no future in personal computers because of the high cost of hardware. It then instructed sales managers to intentionally keep PC sales under a certain threshold.
Compaq was an American developer and producer of computer products and services. After strong initial success, the company was acquired by HP in 2002 with the Compaq brand retired in 2013.
Compaq’s short-sighted acquisition of DEC provided the catalyst for its decline. While the company was dealing with the ramifications of the acquisition, competitors such as Dell and Gateway increased their market share.
Compaq also experienced a loss in revenue after the dot-com bubble burst. This was exacerbated by the standardization of chipsets and motherboards by Intel.
Kodak is an American photography product and service company founded in 1892 by George Eastman and Henry A. Strong. After dominating the photographic film industry for decades, the company filed for bankruptcy in 2012.
Kodak was not ignorant of digital camera technology. But it did fail at various stages to commit to digital products entirely despite overwhelming evidence that the technology would prove profitable.
Kodak was also the victim of the changing retail landscape and consumer sentiment toward foreign products in the United States. Blind in its devotion to printing, it also missed an opportunity to create a Facebook-style photo-sharing website three years before Facebook itself was conceived.
Friendster was a social networking site that then transitioned to a gaming platform. Ultimately, Friendster failed to capitalize on its early success as one of the first social media platforms to experience mass uptake.
When Friendster became a gaming platform, it failed to notify its user base. This set in motion the migration of users to Facebook which would continue for some years.
Friendster’s decision to raise funds via venture capital funding populated its board with investors who were not interested in technology or innovation. The company was acquired by MOL Global in 2009 who then sold its patents to Facebook soon after.
xStumbleUpon was an early social network founded by Garrett Camp, Geoff Smith, Justin LaFrance, and Eric Boyd. At one point, the platform was responsible for half of all social media traffic in the United States.
StumbleUpon suffered intense competition from the likes of Pinterest, Digg, and Reddit – both in terms of site functionality and monetization strategy. After a failed partnership with eBay, Camp bought back the company and instituted a major redesign to limited success.
The StumbleUpon user experience became outdated as consumers preferred to waste time scrolling through news feeds. Upon this realization, Camp shut down the service in 2018 to focus on a more modern iteration called Mix.com
Altavista was a pioneering search engine developed by a group of Digital Equipment (DEC) researchers. It was originally created to showcase the power of a then-revolutionary DEC supercomputer.
After an ominous partnership with Yahoo in 1996, AltaVista underwent a series of acquisitions and format charges as several companies tried to make it profitable. In the process, the search engine lost market share to up-and-comer Google.
Yahoo acquired AltaVista in 2003 and absorbed the technology behind the search engine into its own platform. AltaVista was formally put to rest ten years later.
Blockbuster was an American movie and video game rental chain. The company went from industry leader to filing for bankruptcy with $1 billion in debt in less than a decade.
Blockbuster relied on late fees to drive a high proportion of revenue. This strategy proved uncompetitive after Netflix offered fee-free movie rentals by mail. Blockbuster lost significant market share to Netflix in the ensuing years and experienced a decline in profit after abolishing late fees in an attempt to remain competitive.
Blockbuster’s demise is mostly due to an inability to innovate. Although passing on the offer to purchase Netflix is noteworthy, the company failed because of a myopic focus on its outdated rental franchise model.
Napster was a peer-to-peer music-sharing software application. It was the first such platform to provide free access to the full history of recorded music online.
Napster quickly attracted the attention of music artists, with Metallica instigating court proceedings against the company for copyright infringement and the distribution of unreleased music.
Napster was forced to shut down after the Recording Industry Association of America won a court injunction. Mounting legal fees and compensation costs led to the company filing for bankruptcy in 2002.
BlackBerry is an iconic smartphone brand owned by Canadian company BlackBerry Limited. The company enjoyed first-mover status in the smartphone industry, but ultimately squandered its advantage.
BlackBerry was ignorant and in some ways disrespectful of competitors in the industry. It was more concerned with protecting its proprietary technology than innovating to stay relevant.
Though profitable to some extent, BlackBerry’s focus on enterprise customers came at the expense of the far more lucrative consumer market. Government opposition to censoring information also eroded one of the core strengths of the company’s smartphone.
Nokia is a Finnish telecommunications, consumer technology, and information technology company founded in 1865. It enjoyed 51% of the global market share for mobile phones in 1998.
Nokia’s device-based hardware system was cumbersome and outdated, but the company persisted with it while competitors developed the software-based iOS and Android operating systems. By the time Nokia phones offered Android, the company had been left behind.
Corporate mismanagement within Nokia was rife and culture suffered as a result. Internally and externally, the company failed to acknowledge its diminishing relevance and market share.
Xerox is an American corporation selling print and digital document products and services worldwide. The company failed to capitalize on revolutionary research performed at its PARC R&D center.
Xerox was visited by Steve Jobs in 1979 who gained access to PARC in exchange for Xerox receiving shares in Apple. He then purchased the rights to a Xerox GUI and used it to produce the Apple Macintosh.
Xerox released the Xerox Star personal computer in 1981 in a rare example of the company selling an innovative product commercially. However, the Star was prohibitively expensive, targeted the wrong market, and was a decade ahead of its time.
Quibi was an American short-form streaming service for smartphones. Unfortunate timing with the onset of the COVID-19 pandemic is at least partly responsible for the failure of the platform.
Despite billions being invested in securing high-end talent and production studios, Quibi content was generally poor quality. In any case, there was no way for consumers to share or engage with the content they did enjoy.
Quibi was not helped by its pricing strategy and the presence of established competitors offering more for less. It was also improperly and inadequately marketed.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
