Following are 3 video predictions for 2012 from Erick Hachenburg, CEO of Metacafe, a leading creator, programmer and distributor of short-form video entertainment for men. 1. Hulu's ad load will plateau Hulu's continuing efforts to increase its ad load will plateau in 2012. Hulu built its early advertising success on research showing that one ad per commercial pod drove greater impact - and then charging higher CPMs for those ads. Now Hulu has nearly tripled its ad load. The decrease in effectiveness and the subsequent decrease in Hulu's CPMs will put a sudden stop to the efforts to match the TV ad load. Does anyone really believe the research that shows viewers want more ads? Does anyone want to do the research that shows viewers ignoring more ads? The industry has to be more focused on delivering advertiser value and good user experience. 2. We'll finally learn whether YouTube is a real media company YouTube faces a fundamental question this year: Does it really want to monetize online video? YouTube monetizes through AdSense (on site and in overlays) and through homepage events (like a portal), but YouTube viewers currently spend only 0.1% of time watching video ads in and around YouTube videos. I predict that YouTube will jump into the pre-roll marketplace and create waves in pricing, standards and beyond, assuming it can resolve the continuing identity struggle about whether to be a technology company or a media company. The industry must solidify online video's position as a primary medium through which advertisers can connect with today's young consumers - and YouTube needs to step up and participate. 3. Ad networks will become more publisher-friendly Ad networks will face slowing revenue growth in 2012, as ad agencies assert themselves by expanding their exchanges. Agencies target audiences and content, and the exchanges will enable them to do so more effectively by working directly with publishers on high-reach buys as well as high-impact buys that include customized brand integrations and content associations. The old-line agencies will now take their hand at disintermediating the upstart ad networks. The industry must establish an efficient and effective ecosystem in which all the major players - leading agencies, premium publishers and innovative ad networks - work together to collectively serve the best interests of brand advertisers.
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