Online Video Advertising — Seeing Is Believing

With online video consumption increasing over the last several years, advertising dollars targeted at this space have steadily moved to the Web.

The initial wave of these online dollars went to premium videos (primarily online streams of TV shows on sites such as Hulu). This trend has accelerated in the last year, and most premium inventory is sold out; in some cases, prices are rising.

As a result, advertisers are seriously looking at “non-premium” content (typically content that is prepared specifically for online consumption, such as Revision 3).

The New York Times recently reported that video sites, including YouTube, Blip and others, are addressing this demand by creating “channels” of brand-safe content that advertisers will find attractive at lower prices than premium content. You can read this article here:
http://www.nytimes.com/2011/06/06/business/media/06blip.html?hp

Video advertising companies, such as TubeMogul and Tremor Media, are helping to monetize this inventory through real-time bidding engines; and companies like Red Aril, Blue Kai and others are helping publishers move from content-based advertising to audience-based advertising.

This dynamic will hasten the development of a flourishing economic ecosystem for online video, and, in turn, move more dollars from offline to online.

Indeed, when it comes to online video advertising, seeing is believing.

* TubeMogul and Red Aril are Trinity portfolio companies.