istream_app.jpgSaif partners backed online video venture iStream is shutting its operations as it was unable to raise a second round of funding, according to employees who did not want to be named. The layoff was first reported by Medianama.

Last Friday, nearly all employees were called in by their managers and asked to resign. “We are getting a months salary,” said an employee.

The company, founded in 2007, offers video content and was making money from subscriptions, pay per view, sponsorships and advertisements. iStream had raised $5 mn from Saif partners last year. The company had bagged rights to stream cricket matches and television programs as well.

Sources said that the site is shutting down on Wednesday. Radhakrishnan Ramachandran, Founder& CEO of iStream was not available for comment.

With big players like Times Internet and Google’s YouTube turning up their focus, there is quite a bit of competition in the online video streaming space these days. Times Internet’s BoxTV has stitched together quite a few partnerships to stream videos online. YouTube also has a big market share in India.

Yahoo had launched MoviePlex to stream movies in India. YouTube, which recently launched rentals, also streams ad supported full length movies.

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