No shortage of predictions these days, but this one caught my attention, specifically:
Online Video. Something’s gotta give. Two of the “big” three — Revision3, ON Networks, Next New Networks — cease to exist by the end of the year. And when 23/6 and Funny Or Die expire on the same day, Alley Insider’s headline is “Funny Or Dead In 24/7.” Normal people have no idea what any of these things are.
That’s funny. Mind you, not sure if normal people know what WatchMojo.com is, either…
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WatchMojo NewsletterEarnings season is here, and it’s clear that there remains a lot of bad news in the pipeline. This is not good, but the silver lining in all of this is that 2009 will mark the delineation and divergence between businesses who
- have used cheap credit, excess consumption (relative to savings and earnings) and government subsidies and operate in mature/declining industries
and
- those who are growing and have an opportunity to exploit the retrenchment of the companies above.
You see it everywhere: Alcoa bombed last night and announced larger than expected losses, today we learn that SONY might lose $1B, their first loss in 14 years. SONY has coasted for years and lost major opportunities to competitors like Apple (in digital music) and Nintendo (gaming). This is not say either companies are doomed, but as they need to scale back their businesses, it creates a lot of opportunities for new players to attack. This is exactly why some VCs are setting up new funds.
Despite the doom and gloom outlook for display ads, I think the story of 2009 might easily be how publishers will actually yield more revenue by swapping the display ads with video-in-display ads on that same real estate.
And, I’m not alone. Here are some figures from eMarketer:
Let’s look at three places in different segments (technology, news and sports) that are doing this already:
Tech Crunch - Technology
CNN - News
ESPN - Sports
This is exactly what we called for in our 2008 Year in Review / 2009 Year in Preview:
:: 2009: Display Advertising is Dead; Long Live Video Display Ads!
Another major trend we expect to see next year is the death of video-less display ads. Let’s look at a few facts:
- Social networking sites will continue to see eroding sales from advertising: marketers have firmly rejected this notion that social media and advertising go hand in hand. As we have long said: yes, social media has changed publishing, but no, social media is not an advertising friendly trend. Social media is ultimately an oxymoron, we think, social networking is a form of communications, and like email, chat and message board communication, this will not be embraced by advertisers. Look out for more on social media and social networking tomorrow, on Wednesday December 24 2008.
- Traditional display ads won’t cut it: Display banners - the ones and the kinds we’ve become accustomed to - are anything but interactive. Expect more interactivity, namely, more video in it. This bodes well for a player like Klipmart.
- Ad networks under pressure: A lot of the wheelings and dealings in display ads came from ad networks, who will all have to change their business model and adapt to a search and video driven web economy where the value of a traditional display ad will plummet. I stress that a traditional display ad, in my definition, is one next to text content… versus either a a) display ad with a video embedded in it or b) a display ad next to a video player, because a traditional display banner goes unnoticed pretty quickly.
- marketers will ask for more from publishers, and the one asset publishers have is to start including video, either straight video content or video ads embedded in display advertising real estate.
If you are a Fortune 500 marketer looking to get our your message, TV, print and radio won’t be your first choice, but online will be. And when it comes to going online, search does not build a brand or give a marketer the control they want, and nothing will replace video.
:: Video-Powered Display Ads + Video Ads Will Surpass Search Ads by 2010
When you consider the size of TV advertising:
You realize just how big video-related online advertising will be. But the more time I spend working in this space, the more I realize video advertising (as in instream) might be small relative to video-related (as per defined throughout this piece). In this context, I think the sum of all video related advertising is much, much larger than we anticipate and expect.
So to conclude, despite the gloom and doom prognosticators, I think the online media space is going to blow up after February, when a new administration will be swept in and people look ahead to the promise of a new year after the 2008 clusterf*ck to the poorhouse.
Tomorrow, we look at social networking in 2009.
Read the whole piece here, and check out the 2009 Year in Online Video here.
PLAY
