Xstream to Expand North American Operations

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In the 15 years since its founding, OTT and TV Everywhere services provider Xstream has grown from a feisty, Nordic-focused startup to a powerful international player. This week, the Denmark-based company furthered its global ambitions by announcing that its founder and CEO Frank Thorup would be stepping down and moving to the United States and assuming the title director of Xstream North America, with Simon Høgsbro taking over as CEO in the Copenhagen headquarters.

Thorup says he views the Nordic region as akin to a "kindergarten for technology," where companies like Skype, Spotify, and Danish fitness app maker Endomondo (which just sold to Under Armour) can grow before graduating to the international stage. While the Nordic region will remain important to Xstream's business, Thorup says the time is right for the company to further its business in the United States and North America, and that the only way to do that is for a senior executive to establish a presence in the region. Xstream began its move into the U.S. in earnest two years ago when it partnered with Fuhu to build an OTT video and live TV service for the Nabi Tablet.

Last year, Xstream sold a majority stake of the company to Danish private equity fund Capidea, which began pushing for even more business in North America. "We knew that if we were going to get some traction in the U.S., we needed to show commitment to the market and show some experience and a senior presence in order to compete with American companies," says Thorup. "And these days, it's about much more than technology than client references. It's the whole package of having a very committed company behind the technology. We're a little bit less corporate than most U.S. companies, but I strongly believe that we can bring more to the table."

Two years ago, Xstream had already established an office in Los Angeles, in part to be close to the entertainment industry, but also because of strategic alliances with L.A.-based Pepe Digital, which ran the RFP process for Tier 1 telecom Spark New Zealand when Spark was looking to launch an OTT platform of its own. Thorup says Xstream won the bid after competing with 25 other companies, many of them U.S.-based.

Xstream planst to move it's Los Angeles office to the San Francisco area, and is looking to open a New York office in the near future, Thorup says.

Though some of Xstream's earliest customers were Scandinavian newspapers, Thorup says he believes Xstream's strength comes from that fact that the company decided to focus on TV Everywhere and OTT rather than offering products that appealed to a wide variety of verticals. "We decided to fous on a certain few segments in the industry—telcos, cable operators, large broadcasters—rather than trying to run in multiple business segments," Thorup says. "You can't be strong in all of them, and you give up your ability to deliver a competitive platform to each one."

In addition to Spark New Zealand in the Pacific and Fuhu in the U.S., Thorup says that Xstream's other premier customer is Norwegian Tier 1 telco Telenor. "We've grown up with Telenor," he says, "and until 2012 it was all about catching up with their demands."

Høgsbro comes to Xstream from Spark, where he launched and ran that OTT SVOD platform, called Lightbox. Lightbox is available bundled into Spark's internet offerings, but it also is available to customers of all New Zealand ISPs, not just Spark. Lightbox made waves when it became one of the first OTT platforms to offer Netflix content outside of the Netflix ecosystem. "Sony owns the rights to shows like Orange is the New Black  and House of Cards in regions where Netflix isn't present," Thorup says, "and Simon was able to negotiate directly with Sony to get that content for Lightbox."

Prior to Spark New Zealand, Høgsbro spent ten years in various management roles with TDC, Denmark's largest telco. "Simon brings both that experience with a large corporate structure at TDC and wthin a startup project at Lightbox," says Thorup. "He knows the industry and the technology and has a very strategic mindset."

Thorup says that Xstream is also bringing on Lightbox CTO Mike McMahon onto its board of directors. Prior to Lightbox, McMahon spent time in engineering and management roles with both Charter Communications and Comcast. "His knowledge of the industry and products, and experience with taking a company further, can help us penetrate the North American market," Thorup says. Xstream also works with Altibox, Canal Digital, and SBS.

The company has also appointed Jan Bertil Dahms, formerly of thePlatform, to the position of global chief sales officer.

Xstream will continue to present the annual Nordic Media Summit in Copenhagen. "The Nordics will always be very important to us," Thorup says. "It's important that we have been based in a region where clients are willing to invest in technology in order to do business smarter. It's a region that has its finger on the pulse of technology all the time, where if we don't build, other Nordic companies will take over from us."

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