It does to a certain extent...
From the Joost team:
"Full-screen video of any kind inevitably use a lot of bandwidth, and The Venice Project™ is no exception to this. The software downloads about 320MB per hour (as a maximum) and uploads up to 105 MB per hour. The more popular the content is on our platform, the more sources it can be pulled from and the less redundant data we send; that number can be as low as 220MB per hour of viewing. We've made what we think is a reasonable trade-off between the quality of the picture and the bandwidth usage, but this is full-screen TV-quality video - so there are limits on how low we can keep bandwidth usage while delivering good picture quality."
Joost™ - Blog