Over the past week, Iâve spent a lot of time thinking about DivXâs decision to close down Stage6. When I first heard the news, I wasnât sure how to feel about the decision. On one hand, I believe strongly in the free market system and when DivX choose to go public, they took on an obligation to look after their shareholder interests.
By turning to the public, DivX was able to raise more than $140 million in cash from investors who believed in the future of the company. Having access to this kind of capital opened a lot of doors for DivX, but it also came with strings attached. While itâs easy to blame DivXâs insiders for pulling the plug, without their initial support, DivX never would have been able to create Stage6 to begin with. I disagree with the final decision to shut the site down, but I can at least understand the economic realities that drove the decision to remove Stage6 from the core business.
On another hand, I was a fan of DivX long before their IPO and a loyal member of the Stage6 community. Without DivXâs community, they never would have succeeded in the first place and to abandon their fans over corporate profits speaks volumes about the priorities behind the decision makers at the helm of the company. While the cold hearted capitalist in me has no moral high ground to stand on, the fan in me canât help but be heartbroken by the realization that DivX may have lost their soul in the course of going public.