Mike Volpi's trek from Cisco to Joost

Once considered the heir apparent to the CEO spot at Cisco, Volpi talks about what attracted him to the top spot at video start-up Joost.

Marguerite Reardon Former senior reporter
Marguerite Reardon started as a CNET News reporter in 2004, covering cellphone services, broadband, citywide Wi-Fi, the Net neutrality debate and the consolidation of the phone companies.
Marguerite Reardon
8 min read
Mike Volpi was looking for Internet adventure when he left Cisco Systems some months ago, and he seems to have found it.

On Tuesday, the Internet video start-up Joost announced that Volpi, a 13-year Cisco veteran and star player, would be taking on the role as chief executive officer.

Volpi, who left Cisco in February, held several key roles during his tenure with the networking giant. In his last job at Cisco he led the company's service provider organization and was responsible for developing and selling Cisco's next-generation Internet Protocol equipment. He also helped transition products from the $6.9 billion acquisition of Scientific-Atlanta--now called Scientific Atlanta--into Cisco's product line.

Before that, Volpi led Cisco's acquisition strategy. And between 1994 and 2001, he oversaw 75 acquisitions.

At one time he was considered a likely successor to Cisco's current CEO, John Chambers. But now, the 40-year-old Volpi is branching out on his own.

Volpi's choice to take a job with Joost is no surprise given his close ties with Joost's founders, Janus Friis and Niklas Zennstrom. Friis and Zennstrom had also founded Skype, where Volpi has served on the board of directors.

On his second day of work at Joost, Volpi took time to chat with CNET News.com about why he took the job at Joost, what the company's prospects are for the future, and how he plans to change how people watch TV.

Q: What have you been doing since you left Cisco in February? You didn't take much time off to relax.
Volpi: My intent when I left Cisco was not to take time off and relax but to take some time to look around for something I wanted to do next. And this just came in through the side door. I was hoping I'd find something by the end of the year. But it turns out that I knew the founders of Joost from being on the board of Skype. And a week after I left Cisco, they called and asked if I wanted to get more involved with Joost.

I worked for a large multinational company already, and I wouldn't have come here if that's what I wanted to do. I think if we do things right, Joost could grow into a large viable organization on its own.

When I looked at the idea and vision behind the company and the timing of the market, I got excited. Then I went and visited all the different teams around the world. And I just thought that they had a fantastic team and a great idea.

I still went through the process of looking at a variety of other companies. I knew I wanted to do something that had to do with the Internet being a delivery vehicle for content. And I talked to a lot of people about the business and all the research really validated what I was thinking about Joost.

Of course, I traveled a little with the family, but in the meantime I found myself a job. Sometimes in life things come along. They may be a few months off, but I figured what the heck.

What specifically attracted you to Joost? Was it simply because you knew Janus Friis and Niklas Zennstrom, the founders of the company, from your dealings with Skype?
Volpi: Without a doubt, personal relationships and mutual respect definitely played a role. But when I studied the issue of delivering professional-grade video--not the clips or user-generated stuff that is already all over the Internet, but professional-grade video--there were three pieces that needed to come together.

First, you have to make a great experience for the user. That means making it a good visual experience with low latency, no jitter, etc. And the second thing is you need a method by which content owners can manage the content, so that you aren't letting just anyone throw out content. You need to be able to manage the content from a digital-rights perspective as well as be able to target users with programming in different geographies, for example. The third thing was having an advertising platform that advertisers could use to create new kinds of advertisements.

And all three were well represented in the company. There's already been so much written about Joost because of its founders, but we also have a lot of people from MTV and the advertising world. We also have a very good bunch of technologists from the open-source community. Sometimes that gets a little bit lost, but it's very important.

Google's YouTube is the big Internet video play right now. Why does the world need Joost when YouTube is already out there?
Volpi: Joost is very different from YouTube. If you look at the market segment YouTube addresses, it's people who watch video clips--maybe it's of their family or their pets or events that happen on the news or whatever. Viewers will gladly watch a short-segment clip of not very high-quality video on a small-screen format if it's this kind of user-generated content.

But Joost is different. You're not opening a browser or going to a Web page to view Joost videos. It's a software application that takes over the entire screen of your PC, and you can watch 15-minute, 20-minute or 30-minute high-quality programs. This is licensed programming, so none of it is user-generated.

Since this is all professionally produced content, how will you deal with the whole pirating and digital rights management issues?
Volpi: First, the only content that gets on Joost is from an authorized content owner. And once the content is injected into the system, it's encrypted. Authorized users can then watch it on their computers, but they can't copy it or record it. So even though it's a peer-to-peer service they can't upload or rip the video. And the second time they want to watch it, they have to stream it again to watch it.

But doesn't Apple's iTunes offer something similar? Why wouldn't people just buy the shows they want to see from Apple?
Volpi: The Joost programs are streamed in real time. iTunes requires people to download and then you wait to play it. Also with iTunes you have to pay for movies. With Joost, it's free. It's all advertising-supported. So while iTunes allows the Internet to replace the DVD market, Joost is a substitute for traditional TV.

So people have to watch advertisements throughout the streaming video clip?
Volpi: Yes, they'll sit through periodic ads, but it's free. And the great thing about Joost for advertisers is that we know exactly where our viewers are because they are all connecting using an IP (Internet Protocol) address. We also know what they've watched in the past and for how long. So advertisers can do precise, tailored advertising to a particular individual rather than blasting the same commercial to millions of TV viewers. So if you and someone else were watching the same thing on your laptops sitting right next to each other, it's very likely that you will each see different ads.

At Cisco you led the service provider team that sold huge pieces of hardware equipment to telephone companies and even some cable operators. You're more of a hardware guy. What do you know about video entertainment?
Volpi: I had some dealings with the entertainment and content world when I managed the Scientific Atlanta product line, so I got some exposure to it while I was at Cisco. I wouldn't claim to be an expert in media. So there is a lot of room to learn. And there are a lot of good people at Joost who know a ton about media. But Joost also has a significant amount of technology. And although I think it's unfair to say that I am just a hardware guy, Cisco had a lot of software too. I think managing engineers is something I know a little bit about. Incidentally, Joost has about 100 employees and the majority of them are engineers.

But a lot of this is about running a company, managing growth and being a good manager. I think I got a lot of very good experience at Cisco. We ran a good company over there.

A lot of Web 2.0 start-ups have gotten acquired. Is Joost more likely to be acquired than remain independent?
Volpi: I worked for a large multinational company already, and I wouldn't have come here if that's what I wanted to do. I think if we do things right, Joost could grow into a large viable organization on its own.

You handled mergers and acquisitions at Cisco for a while. Do you see Joost growing by acquiring other companies?
Volpi: That's pretty far down the road. We're a small company trying to figure things out still.

How do you see Joost's technology and strategy evolving over the next year?
Volpi: We are still in beta right now with half a million users, and we'll continue to be in beta a little while longer. We'll probably get the full release out in 2008. And we need to continue to execute on the vision and ensure that we have interesting content for people to watch.

We've already got CBS, Viacom, Turner Broadcast and some other major content providers. We've also got some good niche brands. And we should be able to continue to add content. There is a great deal of interest among content producers. And we've already had a lot of success with advertisers. We've got 36 big names, like Hewlett-Packard, Nike, Procter & Gamble, Motorola, all signed up for our trial service. Clearly that says something is interesting to them.

Where do you think people will be watching Joost content? On their cell phones, PCs, TVs?
Volpi: The demographic we're going after is 19- to 30-year-olds who are Internet- and tech-savvy individuals. There are already a lot of teenagers who watch DVDs on their PCs. So we think there will be a big audience watching Joost on PCs.

But the application doesn't need a browser, so you can have a low-end PC that you hook to a TV to watch it on the big screen. There are even some TVs coming out that have hard disks, so you'll be able to plug in Ethernet and watch it that way too. You won't even need a big expensive media center or Windows box to run it.

What about cell phones? Can you watch Joost programming on that?
Volpi: The application itself needs about 500 to 600 kilobits per second. So to the extent you have EVDO or some other 3G network providing enough bandwidth, you could watch it on a mobile device. But you also need the computing horsepower. The application itself consumes some CPU processing. So we won't be offering Joost on mobile devices tomorrow, but it's possible in the future.

Cisco has this new Media Solutions business group that is going out and helping media companies better serve consumers using IP technology. Are there any plans for Joost to work with Cisco on anything? It seems like it could be a good fit.
Volpi: In a broad sense what we're doing is wonderful for Cisco. We use lots of bandwidth for long stretches of time. So I am sure they are happy with what we're doing. But I can't talk about any specifics. Besides, I've only been on the job a day and half. Give me some time.