News

When the National Hockey League shut down two seasons ago, Christopher Sealy's business plans looked finished.

It was the summer of 2004, and his Edmonton-based company, Statusfirm Inc., was in talks with the NHL to supply the league's millions of fans with websites for dozens of players, complete with video highlights that would act like a TV channel for each athlete. But when hockey's labour talks ground to a halt, so did the discussions.

Statusfirm suddenly needed a new strategy for the software it was developing, which made high-quality Internet TV possible at a relatively low cost.

Mr. Sealy's business partner, David Nedohin, suggested they take their idea to a sport on a different sheet of ice — curling. The fan base was smaller, but no less devoted.

When he wasn't working his day job as Statusfirm vice-president, Mr. Nedohin was a world-champion curler. He'd been around the sport long enough to know there were thousands of fans that would likely tune in to curling over the Internet, and many that would probably pay for the access.

“We did a test pilot with curling,” Mr. Sealy said in an interview from Statusfirm's Edmonton offices yesterday. “It was so successful that we decided to launch an entire curling network.”

Soon after, CurlTV.com was born. The tiny experiment has amassed several thousand subscribers who pay $75 a year for premium content, while peak viewership during the major tournaments such as the Brier tops 300,000.

Statusfirm has since duplicated the model with two other Internet TV channels. It launched RawVegas.tv, which produces daily broadcasts from the gambling hotbed. And this week, the company took its biggest step with TheEnergyNews.com, aimed at the global oil industry.

Although Internet video is still largely an experimental business, Mr. Sealy said Statusfirm's strategy is simple. Rather than aim for large audiences, the company looks for niche pockets of viewers that it knows can drive advertising.

With the cost of Web video software and bandwidth dropping, high-quality Internet TV networks can be launched for the price of a new family car in some cases. When Statusfirm looks at a potential market, it knows some sites will break even with fewer than 10,000 viewers a month.

Though the privately held company doesn't disclose its financial figures, Curling TV is already profitable and RawVegas began making money in its first four months, Mr. Sealy said.

TheEnergyNews, which has hired on-air personalities from the CBC and the cable Business News Network, began on Monday and could be profitable in its first year, he added.

Statusfirm plans to add several more sites under its Raw brand, including Washington, D.C.-based RawPolitics and RawLA, to cover Hollywood.

Over the next two years, the company expects to have more than 20 small Internet TV properties, chasing niches of viewers and advertisers. All of this has suddenly put the Edmonton company in the spotlight.

Three years in, Statusfirm now employs over 100 people, including more than 60 in Edmonton and more than 30 in Las Vegas. Not surprisingly, the investment bankers have started calling.

“I keep getting asked about our formula, because we're obviously breaking through and people think that we're smart or something,” said Mr. Sealy, whose background is rooted in marketing rather than technology.

In the end, the company is not unlike any other media enterprise, he said. It will survive if it can build an audience for each site that is big enough to pay the bills. As other Web players experiment with their models — the most prominent examples are Facebook and YouTube, which started building audiences before they even contemplated how to drive revenue — Statusfirm figures out how to turn a profit before it launches, he said.

“We have everybody saying okay we'll get the viewership and then we'll try to figure out how to monetize it. I don't get that,” he said. “Solid business to me means you create a monetization schedule before you turn the switch on. It doesn't make sense to me to run blindly down a road, hoping I'm going in the right direction.”

Launching TheEnergyNews, however, marks the largest single Web TV investment by the company so far.

While most Web video has lower production quality than network TV, the oil patch site is producing two news programs a day that have the look of a television news show.

Statusfirm plans to open offices in the Middle East, possibly Dubai, and have correspondents in London, Houston and perhaps New York. “We're not scrimping,” Mr. Sealy said.

While RawVegas is supported entirely by ads, TheEnergyNews is looking toward a subscription audience, which could make it difficult to drive traffic. However, Mr. Sealy said the site is building out stock listings, rig maps and classifieds for companies to sell equipment, which are intended to build a wider Web community throughout the energy sector.

With oil prices still above $60 (U.S.) a barrel, the company believes there's enough cash sloshing around the energy sector that the monthly subscription fee of just under $60 won't scare away audiences who need the information.

Three years after Statusfirm spoke to the NHL about bolstering its Web video, the league is now trying to boost its Internet presence again. Mr. Sealy said he hopes to continue discussions with the league.

However, Statusfirm is now selling its software to other companies looking to start Web TV businesses, and with another 20 or more of its own channels on the way, the busy 31-year-old could be hard-pressed to find the time should the league come knocking.