Even with US online video advertising spending projected to surpass $1 billion next year, $2 billion in 2009 and $3 billion in 2010, according to eMarketer, several factors hold back growth of TV-like proportions.
One crucial concern comes from uncertainties about the audience's limits, with questions about its willingness even to watch video ads online and how long the ads would play if they run. Audience reactions to online video advertising will ultimately shape how marketers and Web publishers use this medium.
Some research indicates that most people think Internet video advertising is highly irritating. According to the "Online Video Advertising" report from online advertising company Burst Media, 77.5% of those who watch video online find video ads intrusive, while 62.2% say they disrupt their Web surfing experience.
And despite the relative novelty of video on the Web, the problem of too many video ads was the least-liked aspect of online video mentioned by the most Internet users in a Synovate study commissioned by video search company Clipblast!
Yet even for long-form, professionally produced content such as TV shows or movies, 79% of Internet users polled by Piper Jaffray said they are not willing to pay. Is the implication, then, that they would accept video ads in exchange for free content?
Read the conclusion of this extended article tomorrow in Part Two.
The eMarketer Video Online: Making Content Pay report will be published in August 2007. To be notified when it is released, click here.