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Gaiam Readying SVOD Platform Launch

5 Nov, 2012 By: Erik Gruenwedel

Gaiam Inc. Nov. 5 said it has about 20,000 subscribers on board as it completes beta-testing on Gaiam TV, a subscription video-on-demand platform with more than 5,000 proprietary fitness titles, including new Jillian Michaels workout content.

Boulder, Colo.-based Gaiam said it expects to begin online marketing of Gaiam TV after Thanksgiving, with launch slated for sometime in the first quarter of 2013. The programming is not available on any other SVOD platform, including Netflix.

The SVOD platform is projected to incur about $1 million in monthly expenses as it ramps up backend and user interface technologies. Gaiam said the SVOD service should break even with 90,000 subs forecast by the fourth quarter of next year.

“We are particularly pleased to see growth in our media business, as its expanded scale, expertise and operating efficiencies are proving integral to our efforts to provide exceptional service to existing studio partner customers and in attracting new, high-profile content,” said CEO Lynn Powers.

Revenue for Gaiam’s direct-to-consumer segment was $15.9 million, compared with $22.2 million during the previous-year period. The 28.5% decline was due in part to a pre-announced pullback of marketing spending during the recent London Summer Olympics and ongoing presidential and congressional elections as airtime rates proved too expensive.

Separately, Gaiam said it still projects $25 million in gross profit on $200 million in gross revenue for the first year from its Vivendi Entertainment acquisition. The operating segment incurred a $1 million non-cash amortization expense during the quarter.

Overall, Gaiam reported a third-quarter net loss of $11.1 million on revenue of $43 million compared to a net loss of $1.1 million last year on revenue of $41.7 million last year.


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