Telstra has written down the value of its video business Ooyala to zero and recorded a $273 million impairment as a result.
The telco first identified issues with the start-up in 2016, and wrote down the value of its $330 million investment by $246 million at its full-year 2016 results.
It had previously labelled the US tech start-up a "rapidly growing business". Ooyala was the biggest single investment Telstra had made within its venture capital arm at the time.
The telco today said it had now written down the value of Ooyala to zero.
Telstra's head of technology, innovation and strategy Stephen Elop said the telco had made "substantial efforts" over the past 18 months to improve the business' performance.
He said the market dynamics had changed greatly since Telstra took 98 percent of Ooyala in 2014.
"[When Telstra announced the initial impairment in 2016] We believed Ooyala remained a young and exciting company with leading offerings in intelligent video which were continuing to evolve and scale," Elop said in a statement.
"While some of these initiatives have been successful, the market has continued to change."
He pinned most of the blame on Ooyala's ad tech unit, revealing Telstra would look to exit that part of the business given it "had not performed well".
However Telstra still saw a future with the other two core parts - the OVP video player and the Flex media logistics workflow management system - of the Ooyala operation, Elop said.
But while "positive progress" had been made, "the business has yet to achieve sufficient scale".
"We nevertheless believe it is appropriate to impair all of the goodwill associated with the business. From here we will sharpen Ooyala's focus by exiting ad tech and focusing on the underlying video platform and continuing to serve our customers," Elop said.
"We will increase emphasis on our differentiated Flex media logistics product and we will drive operational efficiencies and leverage our go-to-market partnerships with companies such as Microsoft.
"In addition we will remain alert for broader strategic options for Ooyala in a market fragmented across multiple providers."