Google Buyout Of Brightcove Is Talk Of The Town

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The Twittersphere on Wednesday was buzzing with reports that Google is in talks to buy Web video startup Brightcove for $500 million to $700 million.

“Source with knowledge of deal tells me video service Brightcove is in talks with Google about a buyout in $500m to $700m range,” PBS MediaShift editor Mark Glaser tweeted on Wednesday afternoon.

“Brightcove deal for Google would give YouTube entree into paid video service with many traditional media co. clients,” Glaser added.

A Google spokesman said the company does comment on rumors and speculation. A Brightcove spokesman said the company had no comment on Wednesday.

Acquiring the Cambridge, Mass.-based company would give Google’s YouTube a firm footing in a critical area of Web video technology. Indeed, last year, a slew of top Web publishers turned their corporate video content management duties over to Brightcove, including Condé Nast, AOL, and The New York Times.

“Beyond the scaling ability and the uniform platform, we give publishers a more contextual video strategy,” Jeremy Allaire, chairman and CEO of Brightcove, recently told Online Media Daily.

The Nikkei recently quoted Google CEO Eric Schmidt as saying the search giant was poised to begin “seriously looking at acquisitions again.” Yet, according to the Japanese newspaper, Schmidt is considering smaller investments in venture-stage firms poised for growth, rather than mega deals.

Founded in 2004, the privately held Brightcove has raised an estimated $91 million in funding from a long list of investors, including Accel Partners, AOL, AllianceBernstein, Brookside Capital, General Catalyst Partners, Hearst, InterActiveCorp., The New York Times Co., and Maverick Capital.

Allaire said the company was now profitable and cash flow-positive. Despite that contention, all with all its client wins, Brightcove still had to cut 15% of its workforce — or 25 out of 172 employees — late last year.

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