Scoop: Skype founders gunning for Netflix with Vdio
Updated. With Skype's sale to Microsoft finally sealed, one might wonder: What are Niklas Zennstrom and Janus Friis, the European serial entrepreneurs that have founded KaZaA, Skype, Joost and Rdio, up to next?
Context & Ripple Effects
Niklas Zennstrom and Janus Friis have spent two years building toward this: back in November 2009 they were assembling a team for an online music startup, which became Rdio, and they also raised a $266M venture fund along the way. The timing is deliberate — their Skype sale to Microsoft, first rumored in May 2011 when Microsoft entered the mix, closed on Friday, freeing both founders from day-to-day duties at the company that made their name.
Vdio is the next move in a familiar pattern: KaZaA, Skype, Joost, Rdio, now video. The confirmed detail is that Vdio is being positioned directly against Netflix, effectively extending the Rdio subscription model from music into film and TV.
First-order effects
- Netflix gains a new competitor backed by founders whose previous ventures — KaZaA, Skype, Rdio — all scaled consumer distribution fast, entering just as its own subscription video business is the industry benchmark.
- Zennstrom and Friis can now run Vdio full-time, since the completed Microsoft acquisition of Skype removes any conflict or divided attention.
Second-order effects
- Rdio becomes the template rather than the side project: if Vdio replicates its subscription mechanics for video, the two services could share licensing relationships, billing infrastructure, and a single consumer account across music and TV.
- Studios and rights holders gain a second serious bidder at the table alongside Netflix, which has so far defined the terms of streaming licensing deals.
Third-order effects
- If Vdio works, it validates the subscription-access model as portable across media types — one login, monthly fee, all-you-can-consume — pushing the industry further from ownership and per-title rental toward bundled access.
- The Joost episode, including the founders' 2009 lawsuit against former chairman Mike Volpi, showed how hard video distribution is even for proven operators; a second attempt by the same team signals that the underlying economics may finally favor challengers.
The trend: Subscription streaming is expanding from music into video as the same operators and the same flat-fee playbook cross media boundaries, with Netflix no longer the only credible platform.