Sony Pictures Entertainment has acquired Grouper Networks, a video sharing Web site for $65 million.
The acquisition of the Sausalito-Calif.-based company opens up the possibility for Sony to market its movies, music and TV shows on Grouper.com, the online site allowing users to share home-made videos.
We want to be where the audiences are, said Sony Pictures' chief executive Michael Lynton in a statement. The acquisition, he said, showed Sony's breadth of involvement in the field of digital online entertainment.
Grouper represents the first time Sony is investing in a business that facilitates content exclusively for the Web. Sony will eventually monetize Grouper.com by introducing ads and premium content.
Grouper is the world's second largest independent video community, founded in 2004 by a former developers at Spinner.com, an Internet radio firm that was acquired by AOL in 1999 for $320 million.
We have an opportunity, as part of the Sony family, to bring together user-generated and copyrighted content across platforms and devices for the first time, said Grouper's chief executive and co-founder Josh Felser.
The technology blog Techcrunch has suggested Grouper's $65 million acquisition gives rival YouTube a valuation of around $2 billion.