GazProm Media Buys RuTube For $15 Million

GazProm-Media, a subsidiary of Russia’s largest company (and one of the largest companies in the world) GazProm, has completed the acquisition of Russia’s YouTube - RuTube - for $15 million.

According to TechCrunch, RuTube attracted 2 million unique visitors in Russia versus 2.9 million Russian uniques for YouTube in September. It is important to note that RuTube doubled it’s audience since June.

There is an extract of a press release announcing the acquisition translated into English at TechCrunch and it reads as follows:

Gazprom-Media completed the acquisition of video service RuTube. The news came today from TNT – Teleset (TNT-Telenetwork) is the largest television network in Russia. According to sources inside TNT, RuTube is going to be headed by TNT’s Michael Ilitchev.

Ilitchev told Lenta.ru that RuTube will continue its focus on three main areas: video service, online video hosting, media platform. Down the road RuTube might expand its services to brands like RuTube movie, RuTube sport, RuTube music, RuTube news, RuTube humor.

Ilitched pointed out that RuTube founders will continue their involvement in RuTube from the technical side. The rest of RuTube team will continue as subcontractors to support, develop and host the project.

The exact acquisition amount is yet unknown.

It took Gazprom-Media over a year to purchase RuTube. Gazprom-Media announced their acquisition plans back in June 2007, the legal (purchase) process was started in March of 2008. Russian newspaper Kommersant (Коммерсант) wrote that Gazprom-media valued RuTube at 15million USD and had plans to become primary shareholder. It was expected that after the acquisition, RuTube will start hosting videos from TNT and other media properties of Gazprom-Media.

RuTube is the biggest video hosting service in RUNET (Russian internet). According to Gallup, in September 2008, RuTube had over 4mln visitors. Over 5,8 had watched videos.

To read the rest of this story go to TechCrunch.

I am not at all surprised by this purchase as GazProm has been expanding it’s reach in the business world - as portrayed by it’s recent acquisition of the Russian football club Zenit - and the subsequent hundreds of millions of dollars spent on improving the squad and building a new stadium - they certainly know how to build a brand.

If things follow past patterns, RuTube has only one way to go - up.