Wemo Media’s Venice offices aren’t too far from the beach, and that makes sense given its first product: a computer-animated underwater world called theBlu.

Using a global team of freelance graphic artists and some Hollywood visual effects veterans, the company is creating marine ecosystems that range from tropical coral reefs to temperate kelp forests that can be explored by students and other ocean enthusiasts that have downloaded theBlu software.

The company, which raised $2 million this year, is in its early stages, but Chief Executive Neville Spiteri said he expects creating such virtual worlds to be big business. Wemo already has plans to roll out other worlds, possibly one in outer space.

“You could think of us as a next-generation Pixar, targeting web and mobile platforms and focused on family entertainment,” he said.

TheBlu allows users to navigate between the different habitats, buy species and update friends using a Facebook tie-in, similar to Zynga Inc.’s hit FarmVille game. Fish and marine mammals that reside in the virtual world cost from $1 to $25. The desktop program is free, but the company sells a $19.99 pro subscription to get immediate access to more habitats. Spiteri said a mobile app will be released in the near future.

The company also has an interesting compensation model for its animators, some of whom are veterans of big Hollywood effects movies such as “Avatar” and “Titanic.” The animators get about one-quarter of the revenue from the sale of items that they design. Another quarter of the revenue for some animals goes towards non-profit or educational organizations such as the Smithsonian Institute in Washington, D.C. The rest goes to Wemo.

The company currently offers 10 marine habitats and is developing four more, including one for the arctic that will feature icebergs and whales.

Spiteri wouldn’t disclose revenues since theBlu made its beta launch in June, but said he projects $100 million in revenue from the application. Wemo plans to add more gamelike features to encourage purchases from users.

He’s also leading Wemo through another round of fundraising, though he declined to say how much capital is being sought.

Wemo will use the money to expand marketing – theBlu was already featured on Times Square electronic billboards in May – as well as continuing to develop new worlds. He said one possibility is partnering with entertainment studios to build virtual worlds populated with their intellectual property.

The company’s ambition already has drawn notice, including a positive write-up in Wired Magazine early this year. Then in June, British entrepreneur Richard Branson and his team wore jerseys adorned with theBlu’s logo while on a kite-surfing journey across the English Channel.

Digital Transfer

Even with all the content now available for streaming or download from platforms such as Netflix, Hulu and iTunes, there’s still plenty that’s nowhere to be found, such as dozens of years of soap operas and talk shows.

The reason comes down to the costs of formatting the videos to fit the specifications of a wide range of digital distribution outlets, according to Scott Schlichter and Brian Alvarez, co-founders of L.A. startup Motion Dispatch.

Motion Dispatch has a plan to make it simpler and cheaper for content owners to get their work to digital outlets by using cloud-based software rather than contracting a third-party company to do the work.

“There is a lot of content that can’t get into the game,” Alvarez said. “The future is in opening up the pipelines to let the content flow from owners to retailers.”

Part of the reason content owners don’t already send their work directly to distributors is that different outlets have different technical specifications. Some outlets require a ProRes video file, but the format is by no means universally accepted. And what Hulu might call an “episode,” iTunes refers to as a “show,” so separate data entry must be done for each. Other work includes packaging the videos with DVD cover art and data for the names of actors involved so the information can be easily searched.

For now, much of the work is handled by postproduction companies such as Technicolor SA and Deluxe Laboratories Inc. in Hollywood. In fact, Schlichter owns one such company, Dogma Studios in Culver City.

But he said those companies –including his – handle a whole range of postproduction work, using expensive servers that make the services cost-prohibitive for many content owners.

Schlichter said by cutting overhead and using cloud software, conversions that cost thousands of dollars can be done for one-tenth of the cost by professionals at production houses.

The co-founders have been building the business from the offices of L.A. startup accelerator Start Engine, which granted the company $20,000 in seed funding. The company has been conducting a trial of the software with a few clients and plans to release it to the general public next month.

Pricing isn’t set, but the pricing model calls for a subscription fee and an additional usage fee depending on the amount of content formatted.

Staff reporter Jonathan Polakoff can be reached at jpolakoff@labusinessjournal.com or (323) 549-5225, ext. 226.

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