VideoNuze Posts

Underscoring how important YouTube has become as a marketing channel, a new study (free download here) from Pixability has found that all but one of the Top 100 Global Brands (as identified by Interbrand) now maintain a presence on YouTube. Together these 99 brands have generated 9.5 billion views on YouTube across 2,200+ channels, with over 258K videos posted.

Beyond the overall volume of activity, the Pixability study discloses a wide variation in the activity level and effectiveness of the brands' channels. Most striking is that less than half the brand videos posted gained 1,000 views or more while just 1,300 videos - a tiny fraction of all the total posted - achieved more than 1 million views. Further, 37% of brand channels haven't been updated with new content in over 120 days and many brands' channels were simply inactive.

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This morning AOL announced its biggest acquisition to date under CEO Tim Armstrong, buying Adap.tv for $405 million. The deal says volumes about the future of video generally and video advertising in particular. It also underscores the key role that AOL intends to play in helping shape the future.

To understand the deal, it's important to understand 3 of the most important trends in video today: 1) the shift from linear TV / living room viewing to anytime/anywhere/any device viewing, 2) the democratization of video production and distribution enabled by online delivery and 3) the growing importance of technology/data in the ad buying/selling process. Taken together, these trends portend a future of of massively scaled, yet highly personalized video viewing, monetized through targeted, higher-impact advertising.

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Like a lot of you, I spend a lot of time online, and a good amount of it is watching video. As I've often said - at VideoNuze's Online Video Ad Summits and elsewhere - advertising is critical to online video, because, with the exception of paid services like Netflix, Amazon, iTunes, etc, the vast majority of online video is free and ad-supported. Despite how important advertising is, I'm constantly amazed at how untargeted so many pre-roll ads still seem to be.

I'm not claiming anything close to a statistically significant study here. But because I pay relatively close attention to pre-roll ads, I have a pretty decent handle on how relevant the ads are or aren't, at least to me. This morning I saw a perfect example. Tempted by a tweet, I watched a video on Boston.com of a truck flipping over on a local highway. I actually watched it 5 times to see what would happen with the pre-roll. Each time, one of 3 versions of an ad for cable operator Charter Communications played. All nice ads, however, Charter only operates in the Worcester, MA area and further west, not even close to where I live, which is served by Comcast, Verizon and RCN. Why am I seeing this ad over and over again when I can't even buy their service?

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A fortuitous confluence of events could give Aereo a nice bump in visibility and adoption in New York City this week. First, CBS went dark for hundreds of thousands of NYC subscribers last Friday afternoon, as the broadcaster and Time Warner Cable were unable to agree on retransmission consent compensation. Then over the weekend, Tiger Woods - by far golf's biggest TV draw - smoked the field to win the WGC-Bridgestone golf tournament, which was televised by CBS (though not seen by New Yorkers). The win makes Tiger the odds-on favorite to win the fourth and final major golf event of the year - the PGA Championship, being played in upstate New York starting Thursday.

CBS has the weekend afternoon TV rights to the PGA, following TNT's Thursday/Friday and weekend morning coverage. Tiger is gunning for his first major win in 5+ years, since his infamous infidelity scandal knocked him off his game. If Tiger is leading or among the leaders going into the weekend, it would set up intense interest and very strong CBS viewership. But with CBS blacked out - and the network blocking TWC New York subscribers' access to online programming - New Yorkers wouldn't get to see Tiger in action.

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I'm pleased to present the 190th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

We start our discussion with data that TiVo Research and Analytics (TRA) released this past Monday, which concluded, among other things, that Netflix does not cannibalize traditional TV viewing. TRA also identified the percentage of respondents who subscribe to Netflix (and other services) who watched "House of Cards." Using these numbers, Colin calculates that about 10 million people watched the program, a healthy amount by any standard (Netflix hasn't publicly released HoC's audience). Colin sees a class of "super-viewers" whose traditional TV consumption is augmented by, not substituted with, Netflix.

One thing that caught my attention in the TRA data was that while Netflix had a 57% adoption rate among respondents, Amazon Prime was right behind it, at 50% (Hulu Plus was further back at 18%). To be fair, it's not clear whether these Prime members are actually watching video included in Prime, or are mainly focused on the unlimited shipping benefit. But, assuming that many DO watch video, it's an impressive number for Amazon, and underscores how far Prime has come in the 2 1/2 years since Instant Videos were launched.

Colin and I discuss Amazon's broader agenda and how its aggressive pursuit of video is strategic in supporting both Prime and the Kindle ecosystem (all of which I described in my post this past Monday). Given Amazon's willingness to operate on razor-thin margins, I foresee the price for licensing high-quality content continuing to rise, which will in turn pinch profitability (and subscriber growth) at pure play OTT providers like Netflix.

Click here to listen to the podcast (16 minutes, 48 seconds)

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Yesterday afternoon I had the pleasure of attending the Video Ad Effectiveness Summit in NYC, presented by Nielsen and Beet.TV. The afternoon was broken into 3 panels of 3-5 executives from the media, publishing and agency worlds, all of whom are all deeply immersed in online video advertising. The discussions were expertly moderated by Beet.TV's Andy Plesser and Furious Minds' Ashley Swartz. I took a bunch of notes, which I distilled into 3 key themes that I thought emerged from the discussions.

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If you're looking for a case study on how a successful independent content provider with its roots in YouTube is looking to diversify its distribution through other devices/outlets, "The Young Turks" (TYT) is a great example. Yesterday the company announced the availability of its Roku channel and its intention to launch standalone Android and iOS apps soon. TYT's COO Steve Oh told me these direct-to-consumer initiatives are part of a broader plan to augment - but by no means abandon - its traditional distribution through YouTube.

With 50 million views per month, 1 billion+ views to date, and over 1.1 million subscribers, TYT believes it is the biggest online news show in the world. TYT is a top 50 YouTube partner, and what Steve calls a "boutique multichannel network" (MCN) because it focuses on a relatively narrow slice of partners in online news. While there has been some public grumbling about YouTube from its content partners lately, Steve had nothing but praise for the 800-pound gorilla of the online video world, highlighting that all of TYT's new efforts are an "augment" not a "replacement" for YouTube.

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A viewer finds an online video, clicks play and increasingly, expects a TV-like experience. Hundreds of millions of times per day around the world, this sequence of events happens, and it's only growing in frequency. While surging demand is great for the overall ecosystem, network providers / broadband ISPs are continually struggling to keep up with spiraling traffic, pressed to invest in their networks to create more capacity while still maintaining a strong ROI.

Therefore, any incremental improvement in networks' efficiency in delivering video traffic can quickly add up to huge cost savings, and that's exactly what Qwilt, which has raised another $16 million (led by Bessemer Venture Partners and bringing to $40 million total raised to date), does. Qwilt is in the "transparent caching" business, with networks deploying the company's  software solution on off-the-shelf hardware at the edge of their networks to deliver the thin slice of most-frequently viewed video to their users.

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