and Australian markets at a time when many other
online video platforms (OVPs) were focused on North
American and European customers.
Founded in 2007, Ooyala provided strong analytics
for its media customers and won the attention of several companies, including Telstra, which invested in
multiple funding rounds. One of the company’s founders, Bismarck Lepe, was a staple on the Streaming
Media event circuit.
In August 2014, Telstra announced that it was upping its 23% shareholder stake (bought over 2 years at
a total $61 million investment) by another $270 million,
bringing Telstra to a 98% ownership stake in Ooyala.
At the time, comparisons on valuation were made to
Brightcove, another OVP competitor that had gone
public in 2012, raising approximately $55 million in
its IPO, on a valuation of approximately $290 million.
With annual revenues of around $64 million, skeptics
pointed out that Telstra’s valuation appeared to put it
in a much stronger position, especially since Brightcove’s shares were trading at around $6.00 per share
down from a high of $24.80 just after the IPO.
Fast forward a few years, though, and the Telstra
deal hasn’t seemed to pan out for Telstra. In an Aug.
21, 2016 Financial Review article titled “How Telstra
Blew its First Silicon Valley Deal,” Brightcove’s responsiveness to customer problems was praised over
“Brightcove promised to respond to any glitches
within two hours,” the article noted, citing an inter-
view with Fairfax Media video manager, David McMil-
lan. “In emergencies, someone would be available im-
mediately. Its competitor, Ooyala, which was owned
by Telstra, wasn’t so reliable. Emails sent to its Sil-
icon Valley headquarters wouldn’t be returned for
days, if at all.”
In fact, according to the article, Telstra’s CEO, Andy
Penn “acknowledged that Ooyala’s video business isn’t
succeeding and it is switching to a different way of
making money” shortly after announcing that Telstra
had written off a whopping $246 million Australian
Dollars from Ooyala’s valuation.
In early 2018, just before the Sourcebook went to
press, Telstra announced “it expects to make a non-cash