Sony Dumps Grouper for Crackle

With YouTube dominating social video, Sony has decided to exit the sector and refocus its efforts on helping online video creators develop their content.

Grouper, which Sony purchased for $65 million last year, will be renamed Crackle, and will become a streaming entertainment network with connections to traditional methods of media distribution. Essentially, it would move from a distribution model to one that focuses on the creation of content.

At launch, content creators would have access to several traditional media companies to pitch their ideas, including Sony Pictures Animation, Imageworks, Columbia Pictures, Sony Pictures Television, and the Improv Comedy Lab.

This could mean that ideas and shorts that start out as video hits could eventually move to traditional media if Crackle's business model works as advertised.

"We reward the best video creators with Crackle funding, promotion, syndication and even greater exposure to our large media partners. Great content surfaced from our open studio model is the key to our success," Crackle founder and co-president Josh Felser said.

The site would also help authors to distribute and syndicate their videos through Sony devices, IPTV, social networks, and viral video websites. Instead of republished content like other video sites may show, Crackle's focus will be on original content.

Crackle will also host videos on its own site through several themed streaming channels, which will be available in high-definition 16x9 format.

While others have tried their hand at helping users create online content, no one has gone as far as Sony. With the company's vast portfolio of entertainment ventures and partners, Sony is in the unique position of offering amateur directors Hollywood exposure. But the question remains whether content creators will bite.