This is not a parlor trick or a cocktail party question. Let’s try to focus on what Joost was all about and whether — in retrospect, or even in prospect — we might have thought that it was not a serious enterprise. The people who promoted it were serious. But was the concept of the business based on a detailed understanding of the internet and media on the internet that would hold out the prospect of success for this venture? (OK — all those who are not into heavy business analysis can leave here!)

Joost began with awesome credentials — its founders were the inventors of Skype, two young Dutch entrepreneurs who built much of that business in Estonia and Finland, and ended up being the worldwide free telephone system of choice! I remember being in the office of a senior executive at Fox who asked: “Do you use Skype? This is awesome!” … and proceeded to demonstrate a free call to Tokyo.

It’s founders were keen on the new liberated technologies, and they based the system on so called “peer-to-peer” networking strategies that seemingly offered fast free internet delivery of large files. We have several comments about peer-to-peer system in the technology column of our newsletter, and I will find one or two of them and link to them here. But let’s just say that 3 or 4 years ago, peer networking, following the lead of Bit Torrent and the Pirate Bay, was all the rage among the trendy Venture Captial crowd. And Joost had it.

Joost also had television backers and the idea that episodes would be available on Joost for free. Well not exactly free. Advertiser supported. And that was a trendy thought, too. Free to the consumer, advertiser supported, television content. Unbelievably trendy.

The combination was over the top, and Joost took off like a rocket It stumbled a little bit when its second stage ignited (to carry the rocket imagery forward), but still it was a well known and admired site. (And let’s not forget that the folks with the television episodes put up big money, too.)

But this business — in its original concept — failed. Not because it was too trendy. Because it’s ideas were not soundly rooted in the realities and economics and technology of the new media. So — let’s just say it — yes, I think Joost’s demise was predictable. And here’s why:

1. Peer networks are not commercial. They are not predictable. They are not fast. There are better choices. When we built (I say “we” but I mean our tech people and Scott in particular) our “burn-to-own” system that delivers a DVD via the internet to your DVD burner, we built it to be reliable, fast, predictable. It’s a better delivery system than peer networks technically. That’s not important for casual file sharing communities, but it’s critical for a large scale business. Joost made the wrong choice.

2. Joost was technology driven. They needed content to put on their peer network delivery system, so they chose television. Television shows have large audiences, and television programs have big files and this was what they were meant to do — deliver large files to large audiences. But content was second. And the content they chose was second. Joost’s priorities were off.

3. Joost was/is a high cost system. Advertising is pennies per viewer, and you need millions of viewers contantly watching to make money. Joost was too expensive for that revenue stream.

There is a logic to how these things work, and the job is to get the logic right. Not to be trendy. Not to be techno super. Not to have the hottest features or fans. The job is to get the logic right. It’s not very glamorous, but if you’re right, you’re right. That’s something, isn’t it?