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Broadband Video Contextual Ad Space Heats Up, Digitalsmiths Lands Series A Round of $6M
Tomorrow Digitalsmiths, an entrant in the budding broadband video contextual advertising space, will announce a $6M Series A round from The Aurora Funds, Chrysalis Ventures and individual investors. I got a briefing from Digitalsmiths's CEO Ben Weinberger and CTO Matt Berry along with the new investors. The company's new Videosense product builds off of their existing automated video indexing and search product known as InScene which Hollywood studios have been using for years to index and search stock footage.Videosense introduces a contextual ad matching process that matches ads to the content of videos based on an index of metadata that was extracted from the audio track and visual cues (scenery, characters, props, etc.). This matching and metadata gathering process is the company's secret sauce. As with all contextual approaches, the intention is to insert the appropriate ad at just the right moment. So say, for example, you're watching ‘24' online, when Jack Bauer pulls out his smartphone, a discreet ad for Treo pops up. The company can support all types of ads (video, text, banners, etc.) Digitalsmiths can do this across multiple video formats (Flash, WMV, Real, etc.) and plans to serve multiple devices as well.While they haven't announced any customers yet, Weinberger said they're in multiple live customer trials and should be announcing something soon. There's been lots of energy and top tier VC funding in the contextual video ad serving space recently. Other companies that we're aware of in this space include ScanScout, YuMe, Adap.TV, and Gotuit (which has been more focused on indexing than ads), along with blinkx, which just announced its "AdHoc" product today.Over the past year, vendors' efforts to improve upon today's vibrant, yet much maligned, pre-roll format have intensified. There are many different initiatives out there, such as new formats, interactivity, targeting, etc. Improvements in contextual targeting are part of this mix of innovation. All this activity isn't surprising as broadband video content providers have embraced advertising as their business model of choice.Since pre-rolls are still the lifeblood of the broadband video industry and will be for a while, smart vendors will seek to build on its momentum, while gracefully introducing new formats. And since much of the pre-roll delivery infrastructure is now in place, it's also essential for the new crop of contextual vendors to integrate seamlessly with existing ad networks. Digitalsmiths seems to be adhering to this game plan, and so their development is worth keeping an eye on.Categories: Advertising, Startups
Topics: Adap.TV, Blinkx, Digitalsmiths, Gotuit, ScanScout, YuMe
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Video Syndication Activity Builds
News earlier this week that Fox Entertainment Group would be working with Brightcove to ramp up its syndication efforts adds to the drumbeat around this trend that was already pretty steady.Six months ago in my December, 2006 e-newsletter, "7 Broadband Video Trends for 2007", I identified broadband video syndication as important going into 2007. Back then I noted that "Syndication is the handmaiden of the ad-supported broadband video business model. Successful online advertising requires scale and targeting. Syndication provides both." I think we're seeing that play out.Whether the NBC-News Corp JV, CBS Interactive Audience Network, FEG deal, or countless others I've heard will be announced soon, they all point to same underlying fundamentals. Producing high-quality video is expensive. Content providers want to maximize their ROIs. So they want their content in as many places as possible to aggregate as large an audience as they can, so they can harness online advertising's potential. While none of this is a surprise by online standards, it is a departure from the traditional video models of tight control, limited distribution and exclusive deals.It's very promising to see the how much progress is being made so quickly to evolve to Internet-centric distribution approaches. More evidence that the media industry's future will be quite different than its past.Categories: Advertising, Partnerships
Topics: Brightcove, FOX, Hulu, NBC, News Corp
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CNN Sets Pipeline Free
News from CNN that it is jettisoning the subscription model for its Pipeline service. Smart move for them. Based on our recent report on the top 75 cable TV networks’ broadband video initiatives, I now count only 3 networks still using a subscription model (note, all in conjunction with free, ad supported video).Those 3 are:-
Golf Channel “The Drive” Premium Membership - $29.95/year (lots of instructional video – makes sense to charge)
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CourtTV “EXTRA” - $5.95/mo (feeds of multiple trials simultaneously, for the armchair criminologists among you)
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Weather Channel “Desktop Max” $29.99/year – (really the ad-supported Desktop service, but minus the ads, and also more comprehensive than just video)
Categories: Advertising, Cable Networks
Topics: CNN, CourtTV, Golf Channel, Weather
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Nisenholtz’s Streaming Media Keynote: Times Gets Broadband Video
I was at Streaming Media East today, moderating a session (“Broadband Video: What’s the Formula for Content Success?). First off, kudos to Dan Rayburn and the SM team – there was a ton of energy at the conference, lots of exhibitors and great sessions.
I got a chance to sit in on Martin Niesenholtz’s keynote. As many of you know, Martin’s the longtime SVP, Digital Operations, for the New York Times Company.
As many of you know, I’ve been very bullish on newspapers’ opportunity to use broadband to morph themselves from print-only outlets to multi-platform content providers. The Times has really been out in front on this. Some key stats Martin shared:-
5M streams/month – up 3x from a year ago
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20 people dedicated to video
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100 new video pieces created/month
Martin shared a back-of-the-envelope analysis he’s done to back into how many streams the Times needs to provide to generate $30M in annual revenue from video. His calculation: 60M streams per month, or 12X today’s rate. I didn’t agree with all of his assumptions (for example he assumed $60 CPMs, which is too high, yet only a 1:1 ratio of ads:streams, which I think is too low given the opportunity to surround an in-line video player with display ads), but I did think he was in the ballpark.
Importantly, he’s targeting to generate 5X the viewership of Times video via 3rd party distributors as will be generated at Times.com. Pretty strong endorsement of the syndication model.Categories: Advertising, Events, Newspapers
Topics: NY Times, Streaming Media
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Google Ramping Up AdSense Video Distribution
Google is finally starting to ramp up the use of its AdSense distribution network to deliver video. As today's NYTimes piece describes, Dow Jones, Conde Nast and others are participating. This follows on previous announcements with MTV, Sony BMG and Warner Music Group. As I said in "7 Broadband Video Trends for 2007", Google is extremely well-positioned to lead the nascent video syndication market by leveraging both AdSense and AdWords. Clearly while the major networks grapple with how to deal with Google/YouTube, other media companies seeking to harness Google's distribution might are moving ahead.
Categories: Advertising, Portals
Topics: Google
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UGC Revenue Sharing Ramps Up?
Chicago Tribune article suggests that user generated content producers being paid for their works will soon be ubiquitous. Of course Revver and others have been doing this for a while now. Steven Starr from Revver raises the “recognition vs. reward” question that undoubtedly passes through any UGC producer’s mind.
I’ve said for a while that if someone had laid the YouTube business plan next to the Revver business plan back in 2005, logic would have suggested that Revver would have better prospects given its willingness to share revenues with producers (thereby creating more incentive to post there).
However, what would have been missing from that logic would be the 2 things that I believe made YouTube an early (and big) winner – namely its willingness to push the envelope in allowing copyrighted material to be posted on its site and its superior user experience. Having won the first battle, YouTube appears poised to overlay the financial incentive long missing for content producers. If well-executed, this should make the landscape even tougher for all the others to succeed.
Categories: Advertising, UGC
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