online ads are booming

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This ebook is provided by Ways To Make Money http://waystomakemoneyfastx.org/ Online Ads Are Booming, if They’re Attached to a Video – That's What the News Guy Said Online Video, A Very Strong Trend More and more news sites nowadays are putting video on prime website real estate. CNN.com did it, ESPN.com did it, and WSJ.com does it (yes, that's the Wall Street Journal). And that's just naming a FEW. CNN.com general manager K. C. Estenson opined that people are now using the the Internet differently, saying: “With broadband penetration becoming ubiquitous and more and more sites having this easy capability, people are expecting video to be there.”

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This ebook is provided by Ways To Make Money http://waystomakemoneyfastx.org/ More and more news sites nowadays are putting video on prime website real estate. CNN.com did it, ESPN.com did it, and WSJ.com does it (yes, that's the Wall Street Journal). And that's just naming a FEW. Online Video, A Very Strong Trend “With broadband penetration becoming ubiquitous and more and more sites having this easy capability, people are expecting video to be there.”

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Page 1: Online Ads Are Booming

This ebook is provided by Ways To Make Money http://waystomakemoneyfastx.org/

Online Ads Are Booming, if They’re Attached to a Video – That's What the News Guy Said Online Video, A Very Strong Trend More and more news sites nowadays are putting video on prime website real estate. CNN.com did it, ESPN.com did it, and WSJ.com does it (yes, that's the Wall Street Journal). And that's just naming a FEW. CNN.com general manager K. C. Estenson opined that people are now using the the Internet differently, saying:

“With broadband penetration becoming ubiquitous and more and more sites having this easy capability, people are expecting video to be there.”

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That's true. But, isn't it obvious that, when it comes to news, most people would want to see moving pictures instead of reading text and visualizing the events in their minds? MSNBC.com president Charles W. Tillinghast put it best by saying “every watershed event leaves video more popular than before.” But, really, is this the reason why news sites are are starting to look more like television? It's probably safe to assume that the answer to that is a resounding NO. But don't take my word for it. In a New York Times article written by Brian Stelter titled “Online Ads Are Booming, if

They’re Attached to a Video”, he indicated that commerce is the main driving factor. Stelter writes:

“At a time when other categories of advertising dollars are shrinking, video ads are booming. News sites are adding more video inventory to keep pace with the demands of advertisers, and benefiting from the higher cost-per-thousands, or C.P.M.’s, that ads on those videos command.”

According to Stelter, WSJ.com is charging $75 CPM for pre-rolls. And according to WSJ's vice president for digital sales Brian Quinn, it was around $50 last fall. Now, isn't it a bit ironic that news agencies are realizing this just now? Online video has been a hot topic outside of the newsrooms for several years now. And video ads, although paling in comparison to search advertising both in popularity and profitability, have also been around for quite some time already. Since when you ask? Well, probably since online video first became viable. There's an article somewhere on the web written by a guy named David Pitlyuk with the title “A History Of Advertising On Internet Video and Where It Is Going”. The date on the article? August 23rd, 2007! That's just a little over 10 months from when Google acquired YouTube. “Everybody knows that video advertising is going to be the next big thing. Google can’t spend $1.65 billion dollars and not expect any sort of kickback,” went the opening lines of the article. Stelter seems to be aware of the fact that video ads are nothing new, as he writes:

“...video is now the fastest-growing segment of the Internet advertising

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market. Digital video amounted to $477 million in revenue in the first half of 2009, up 38 percent from the same time period in 2008, according to the Interactive Advertising Bureau.”

According to Stelter, the increase in video spending is due to the growing acceptance of pre-roll and he backs this up by quoting Quinn saying that pre-rolls work very well, that “a 15-second pre-roll followed by two to five minutes of high-quality content is a fair-value exchange.” But online analytics firm TubeMogul seems to be saying the opposite. In early February 2010, TubeMogul came out with the results of a study indicating that pre-roll ads are still an unwelcome sight for a broad cross-section of consumers. TubeMogul found that about 16% of viewers were clicking away at the sight of a pre-roll, and the rate is even higher on news and magazine sites. 9% higher. According to TubeMogul CEO Brett Wilson:

“Consumers have so many choices that 16% are going to leave your content just because you put an ad in front of it.”

Okay, everyone's entitled to his/her own opinion and some disagreements are to be expected, even in cases where claims are backed by studies or solid proof. But the thing is, everyone seems to be in agreement when it comes to online video advertising being the next big thing, if it's not yet already. In April 2009, Interpublic's Magna unit predicted that the US online video market will grow by 32% that year (or $168 million more than the previous year's $531 million) and expected the gains to “outpace growth rates for most other emerging media platforms.” Magna believes that the growth was brought about by advertisers are looking more into reaching their audience in a more targeted and cost-effective means. Note that when Magna's forecast came out, the global financial crisis was in full swing.

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Then on January 19, 2010, Magna released their updated “US Media Advertising Revenue Forecast.” Expecting the continued recovery of the economy, global director of forecasting for Interpublic Group of Cos.' Magna, Brian Wieser predicted that “the first quarter of 2010 will represent the last quarter of decline for the US advertising economy during this recession.” Research firm eMarketer is pointing towards a similar direction (and with larger numbers), predicting that video spending will go up by 40% in 2010 to $1.4 billion and that ads attached to online videos are going to generate $5.2 billion in 2014, up from $734 million in 2008. In an interview with The Wall Street Transcripts, D.A. Davidson Senior Analyst Donna Jaegers said that online video viewing will continue to be a very strong trend.

"I think over-the-top video viewing is going to continue to be a very, very strong trend. It was starting to pick up in the last few years, and you're seeing companies like hulu.com put a lot of television programming on the Internet. What I've found over the years is that once technology allows a service to happen, it's very hard for the entrenched competitors, like the media companies in this example, to suddenly slam the brakes on over-the-top viewing and to control its growth. "At CES there were a lot of Internet-ready televisions on display. Right now you have a lot of consumers that are hard-hit by the economy, trying to save money and looking at ways that they can see the television shows that they want over the Internet instead of having to pay a cable bill or a satellite provider. I think that trend will continue to happen."

Price Drop In an interview with Beet.tv at the OMMA summit in September 2009, BrightRoll CEO Tod Sacerdoti said that price of video ad CPMs have been dropping by $1 to $1.50 every quarter.

“We've seen a pretty consistent trend of about a dollar to a $1.50 reduction in CPM every quarter since we started the company. There are different perspectives in the industry whether this is good or bad but my personal perspective is that the prices have been inflated and there has been a false

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equilibrium in the market about scarcity of quality inventory. And as the price has dropped we've seen much larger budgets come into the category. So, generally speaking, as long as the price doesn't continue to fall to the bottom, but finds the appropriate equilibrium which is probably in the low teens on a CPM basis, we'll see larger budgets come from television.”

By “larger budgets” Sacerdoti meant “how much media is being bought in online video” which according to him was “definitely growing.” Top U.S. Online Video Ad Networks (ComScore December 2009 Data) ComScore's rankings for video ad networks' “potential” reach for December 2009 listed ten networks. The rankings were determined through a combination of the ad networks' self-reported publisher list and comScore's own tracking.

Tremor Media Founded in 2004, Tremor Media provides both in-banner and in-stream video advertising opportunities. It has over 1,400 partner publisher sites and generates over 142 million unique visitors every month. Tremor Media has in its offering what it calls the “Acudeo Video Monetization Platform”, it is a full suite of products and services that helps publishers monetize streaming video and maximize their ROI. The company's full service solutions

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provide the necessary tools enabling both advertisers and publishers to utilize online video advertising as an interactive medium. Tremor Media is based in New York, New York and has offices in Detroit, Atlanta, and Toronto.

Broadband Enterprises (BBE) Founded in 2004, Broadband Enterprises (or BBE) claims itself to be “the only online video company created exclusively for all aspects of the online video community - advertising, publishing and creative.” Vindico, BBE's proprietary ad serving, tracking, and managing platform, lets advertisers and their agencies control the deployment, assignment, and scheduling of their ads across broadband networks. It was launched in early 2007 and has (as

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of October 2009) served over 16 billion ad impressions. BBE is based in New York, NY and has ties with over 300 advertisers and over 1,200 publisher sites.

Advertising.com Established in 1998 and formerly known as TeknoSurf AdWave, Advertising.com is an online advertising company offering advertising solutions across various media including display, video, mobile, and widgets. The company was acquired by AOL on June 24, 2004 and, as of October 2008, has come together with other technology companies including Tacoda, AOL, Buy.at, and Quigo under the "Platform A" banner. Together, Advertising.com and AOL top the

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online reach tables for display advertising. AOL, Advertising.com's parent company, is based in New York City. It has offices in other parts of the U.S. and in various countries all over the world.

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SpotXchange SpotXchange refers to itself as "a performance-based video ad network that guarantees our advertisers generate a return on their video advertising investment." The company is a spin off from Booyah Networks, a Colorado-based digital marketing and technology company. In 2007 and 2008, SpotXchange's patent-pending online video advertising platform received the Streaming Media Readers' Choice Award for Best Video Ad Platform. In July 2009, comScore listed SpotXchange as the top video ad network for reaching a potential 47M unique visitors every month. In December of the same year, SpotXchange released its Audience-Targeting Video Ad Service making audience profiling available across each of its 2,500 partner sites. Among SpotXchange's clients and partners are Reckitt, TVU, Mochi, RealGames, and Razorfish, just to name a few. The company is based in Colorado and has offices in New York and in the U.K.

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YuMe Networks Founded in 2004, YuMe is a privately held online video advertising company that, in its own words: “makes it easy for publishers to make money from their video content and for advertisers to reach audiences in a powerful way.” YuMe has in its offering a video ad management platform called "ACE" that helps publishers make the most out of their video inventory, manage multiple syndication partners, and expand to various platforms such as Web, mobile, and IPTV. Yume is currently connected with over 500 publishers including MSN, NBC, and Fox News. It serves over 25 million in-stream video ads every day. YuMe is based in Redwood City, CA and is backed by Khosla Ventures, Accel Partners, BV Capital and DAG Ventures.

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ScanScout Founded in 2005, ScanScout refers to itself as the world's largest in-stream video ad network. comScore has data to back up this claim (at least up to July 2009), listing the company as the most viewed online video ad network. It serves hundreds of millions of ad impressions every month. ScanScout provides partner publishers with a revenue stream by enabling them to “extract the most value out of their video content and monetize it in a user-friendly manner.” On the other hand, it provides advertisers the ability to target, optimize, and deliver their messages to the right venue and audience, enabling them to maximize user engagement. Scan Scout is based in Boston and has offices in New York and Los Angeles.

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Break Media Founded in 1998, Break Media refers to itself as “the Internet’s premier entertainment community for men.” The company owns several branded properties namely Break.com, MadeMan, Chickipedia, Cage Potato, Holy Taco, Screen Junkies, All Left Turns, and Break Media Network. With its worldwide reach, Break Media provides advertisers with the opportunity to market directly to a young, male demographic. The company distributes premium content in various genres (e.g., music, gaming, entertainment, and sports) and currently generates over 70 million unique visitors every month of which 70% are male aged 18 to 34. Break Media is based in Los Angeles, CA and is backed by Lionsgate Entertainment.

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BrightRoll Founded in 2006, BrightRoll refers to itself as “the world’s largest and most trusted video advertising network” and prides itself of “having served billions of advertisements since it was founded.” The company is connected with publishers that include three-fourths of the top 100 online media properties in the United States. It also has ties with three-quarters of the top 50 advertising agencies in the U.S. With its proprietary “campaign execution, inventory management and advertising delivery technology,” BrightRoll is able to offer advertisers full site disclosure, detailed performance reports, and flexible targeting. In early February 2010, BrightRoll surpassed Hulu in viewership, making it the largest aggregator of premium video viewers on the Internet. BrightRoll is based in San Francisco, CA, and has offices in the U.S. and in the U.K.

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Adconion Media Group Adconion Media Group refers to itself as the "largest independent global audience and content network, dedicated to true partnerships with agencies and marketers." Adconion has in its offerings customized technology and products that let advertisers and marketers reach a global audience across multiple platforms. The company claims to be capable of reaching nearly 300 million unique users worldwide. Adconion is based in the U.K. and has 16 offices in 7 countries around the world, including London, Hamburg, Munich, Dusseldorf, New York, Los Angeles, San Diego, Chicago, Detroit, San Francisco, Toronto, Paris, Madrid, Sydney, Melbourne and Brisbane. The company acquired certain assets from Joost (an online video service) in November 2009.

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TidalTV Founded in 2008, TidalTV is an online video advertising network "developed to harness the rapidly growing distribution and consumption of online video." The company offers monetization and technology tools that enable marketers and advertisers to deliver their messages efficiently and cost-effectively against their target demographics. TidalTV CEO and founder Scott Ferber is also the founder of Advertising.com where he pioneered "pay-for-performance internet marketing" and created a "viable internet advertising alternative for direct response marketers". TidalTV is based in Baltimore, MD and has offices in New York and Texas. It is funded by Valhalla and New Enterprise Associates.

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Comparing comScore's December 2009 data to that from July of the same year, we can see that online video advertising is a highly volatile industry. Notice how ScanScout fell five places in less than six months. Also, notice that Nabbr (which placed 9th in July 2009 with 12.6% share of the pie) is now out of the picture and TidalTV (which was not in July's listing) is currently in 10th place with a higher viewer penetration than what Nabbr had at the time. (Table courtesy of comScore.)

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As Online Video Viewing Continues to Rise, YouTube is Still King In early February 2010, ComScore released the December 2009 data from its Video Metrix service. The data showed that about 178 million Internet users in the U.S. watched online video during that month and that online video viewing continues to rise with Google reigning supreme in both number of unique views and number of

videos viewed. (Tables courtesy of comScore.)

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Just look at how far the 1st-runner up (Hulu) is in both cases! For comparison, below is comScore's July 2009 data. (Table courtesy of comScore.)

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