A new report from eMarketer predicts that more than 50% of the US population – 155.2 million people – will watch video online next year.
The
Video Advertising Online: Spending and Audience report says that the high engagement factor of video, combined with the internet’s tracking and targeting capabilities, offers a valuable revenue stream for web publishers and a highly accountable method for brand advertisers to sway the hearts and minds of target audiences.
However, it adds that several factors are preventing the ad spend from rivaling the audience size.
eMarketer says that 2007 will show the greatest year-over-year growth for online video ad spending, rising 89% to $775 million.
More significantly, the growth rate will remain near or above 40% through 2011, when video ad spending will reach $4.3 billion.
David Hallerman, senior analyst and author of the report, said: “As marketers and Web publishers look for ways to expand video’s place in the online advertising universe, two key concerns will keep growth below expectations.
“One is the uncertainty about what the audience will accept, with questions about where in the content the ad will run and how long it will run for. The other is the difficulty gathering together enough video ad inventory, with questions about ad placement and how to monetise the billions of user-generated video streams.”
A recent report from Understanding & Solutions predicted that internet TV advertising could achieve revenues of up to $10 billion worldwide by 2011 (see Internet TV Ad Revenues Could Reach $10bn Worldwide).
Meanwhile, research conducted by The Nielsen Company for The Cable & Telecommunications Association for Marketing said that an estimated 81 million people in the US watch broadband video at home or at work (see 81 Million People In US Watch Broadband Video).
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