Akimbo Closure a Sign of Saturated VoD Market?

Akimbo, the VoD company with an ever-changing identity, has indeed laid off workers and closed its doors, confirming reports that sprung up over the Memorial Day weekend.

Calls to the San Mateo, Calif., company went unanswered Tuesday afternoon.

Akimbo’s demise — first reported late last week by various outlets — signals the end of a company that managed to raise somewhere between $47 million and $56 million from investors since its founding in 2002. In fact, Akimbo just secured the final $4 million in February, leading industry observers to wonder how the firm could have gone out of business so quickly.

The closure came after Akimbo tried several times to reinvent itself.

At first, in 2002, the company banked on a pricey set-top box that would let users download television shows. When that didn’t work, Akimbo moved into the PC software arena. Akimbo for Media Center, a Microsoft Corp. platform, installed a plug-in so users could stream video. That strategy fell flat and finally, earlier this year, Akimbo positioned itself as a white-label video service provider. The new business model relied on income from ads, subscriptions, downloads, gift cards and more.

Akimbo must have felt confident about its prospects — or it was taking desperate, last-minute steps to right a sinking ship — because it also appointed a new CTO after snaring that last $4 million.

During its various incarnations, Akimbo got financing from the likes of AT&T Inc., Cisco Systems Inc. and equity group Draper Fisher Jurvestson.

The end of Akimbo means that “anyone with set-top box dreams should be worried,” technology blogger Om Malik wrote on May 23. Other industry observers said Akimbo’s ruin shows that content delivery is such a saturated, frenzied market that no competitor can afford to fall behind.

Three people reportedly are staying on at Akimbo to sort out logistics such as finding a possible buyer and using remaining funds to dole out severance packages.

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