Grouper, the video-sharing website bought by Sony for $65 million last year, is to be renamed Crackle and relaunched as an online talent agency designed to feed its parent company’s Hollywood studio.

Bowing-out of the user-generated content arena dominated by YouTube, the revamped Sony site will run competitions aimed at scouting future professional stars.

Wannabees will submit videos to compete for prizes including project funding of up to $20,000 a time, and access to pitch to Sony executives. Winners will be decided by site viewers and panels of judges.

"We're out of the user-generated-video business and in the emerging-talent business," Josh Felser, who founded Grouper and is now co-president of Crackle, said.

The move comes as video sites seek to differentiate themselves from Google’s YouTube, the sector’s runaway leader. YouTube’s audience share is greater than the next 64 similar sites combined, according to HitWise, the market researchers.

Mr Felser added: “[User-generated] content is rarely exclusive and it’s hard to monetise. Advertisers don’t want their content next to a video of someone jumping off a roof and falling on their head.”

Like YouTube Crackle will also solicit videos from amateur filmmakers, but it will also produce its own content and will be split into channels for different genres.

Grouper’s “pathways to Hollywood and fame” will include quarterly contests for the best animated clips. The winner will get a cash prize and a trip to Los Angeles where they will be able to pitch a feature-length cartoon to Sony executives.

The quarterly contest winner on its Shorts channel, for short-form video, will get a financing deal from Crackle development budget and a meeting with executives of Columbia Pictures or Sony Pictures Television.

The best stand-up comedian on Crackle's High Wire channel will perform for 15 minutes at the microphone at one of the Improv's comedy clubs in Los Angeles, New York or Chicago.

Sony hopes that people will come to its site to view the Crackle videos but clips will also be distributed on AOL, MySpace, Facebook and several other social networks.

They will also be compatible for downloading onto Sony PlayStation 3 game consoles, Vaio computers and internet-enabled Bravia televisions.

Times Recommends

• C&G axed - 1,660 jobs to be lost
• UK house prices rise 1.1% as buyers return
• Mixed reaction to US banks repaying bailouts