Veoh Chooses Death Over Competing With YouTube

Popular video site lays off staff, prepares to file for bankruptcy

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    NEWSLETTERS

    Veoh let go of their employees Wednesday.

    Veoh's biggest victory may have ultimately led to its demise.

    The once well-funded web video startup abruptly ended its five year run to profitability this week by laying off its staff and reportedly preparing to file for Chapter 7 bankruptcy.

    A costly copyright lawsuit with Universal Music Group forecasted Veoh's end long before it happened by some. The one-time YouTube rival had eaten much of its $70 million in seed money and wore out its potential usefulness to major early investors like Goldman Sachs and Michael Eisner.

    Veoh Board Member Todd Dagres turned to Twitter to blame the death of the company on the Universal suit despite his company's victory last September.

    "Veoh is dead," he tweeted. "Universal Music lawsuit was the main killer."

    The "mortally wounded" company struggled to entice investors -- or even a buyer -- to believe in the company and its reported 25 million users.