Looking for evidence that the online video ad market is tightening

February 4, 2009

Daisy Whitney’s New Media Minute is out this week and in addition to discussing the basics of fair use (a supposed “safe harbor” in the world of YouTube video production that won’t, in fact, turn out to help as many people as hope it might), she opens with a brief discussion of how online video producers are starting to back away from producing online videos on spec. Instead, they want advertisers signed up from the get go — the way that Electric Farm Entertainment (EFE) NBC produced the NBC-distributed non-hit Gemini Division, for example. (Amended to reflect Brent’s comments below,5 Feb).

See Daisy’s video below for more details. This could mean the market is maturing. It could also mean the market is getting tougher and people don’t want to spend in hopes of later payoff. For my part, this is causing me to finally step out and address the big question that has been hanging over online video since the market crashed in October: Is the market for online video advertising tightening? Are advertisers — once eager to spend a 50% premium on a CPM basis to reach ABC.com or Hulu.com audiences — going to pull back from this medium simply because cuts are coming across the board? I say this in an environment where broadcasters expect a bloodbath on the upfronts later this year — the same upfronts where a lot of online video sponsorships are presold (think Sprint + Heroes). 

It’s time to collect the evidence. What are you seeing? What conversations are you party to where people are cutting back on online video? Or are you hearing people get smart about it and realize that an online buy is still less-cluttered and more-targeted than other TV buys? I’d love to hear specifics, anonymous or not. Have at it.

Vodpod videos no longer available. 

 

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