Online video: The profit formula
By Christophe Louvion
Inexpensive, easy-to-use social media techniques are making video an expected part of the user experience. Find out how mid-sized web properties can get in on the action.
A few years ago, the promise of online video ad revenue proved elusive for all but the largest web publishers. Most had little patience with video providers as they struggled with slow bandwidth, expensive storage, limited browsers and varying video ad standards.
More recently, since the explosion of YouTube and its hundred clones, several newer video enabling technologies have also failed to gain traction and critical mass due to insufficient marketing efforts and unimpressive ROI. And midsize to smaller sites have been virtually shut out given expensive pricing and problematic implementation.
Today, costs of bandwidth and storage have fallen to the extent that quality feature film downloads, full length TV series, live-streamed sporting events and viral video contributions of social media are all making video an expected part of the user experience. With more eyeballs come more advertisers, and pre/post-roll video ads, rich media overlays, product placements and branded viral video are accelerating every day. But how do “mid-tail” publishers — those thousand midsized web properties following the portals and top 100 sites — participate in this growing revenue boom?
Technically, they split into two categories: the ones that have already figured out how to manage, publish and serve millions of videos, and the ones who are working on it. From a business perspective, though, they mostly fit one profile: trying to figure out how to make money from it all, utilizing platforms and players from Brightcove, Springboard and others. So, it’s important for web publishers of any size to understand the key factors in the profit formula so they can choose the right solution for their needs.
Startup and ongoing costs
Starting small — testing a new video section site with a few videos — and getting quick feedback from site users is a sound financial approach. But the potential problems of ongoing data storage and bandwidth cost must be understood upfront.
Publishers with large-scaled storage and well negotiated content delivery networks (CDNs) may want to store and serve videos from their own infrastructure. Others may prefer to use a third-party hosting and serving platform and not have to worry about it. Such solutions usually cost in the $2-3 CPM range with no upfront out-of-pocket costs and, therefore, no exposure or risk. This alone will allow hundreds to thousands more websites the ability to provide video.
Ad management
Publishers need to be able to serve standard ad units — like pre-rolls, mid-rolls and post-rolls — as well as new media units like overlays, companion ads, custom units, product placement and branded viral videos. And, with new tools coming to market more and more frequently, publishers should be looking for a video player with a plug-in ad layer that allows expansion without any work on their side.
A solid solution should utilize DoubleClick’s Motif and DFP ad serving platforms, Panache and other rich media providers. Publishers also need to be able to control ads by geo-targeting and frequency capping, and be able to restrict certain advertisers from serving ads through their site player. Publishers need to have full control over what types of ads they want and don’t want to run through their video players, whether it’s a specific advertiser or category of advertisers, type of content or other pre-defined parameter.
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News Source :->Imediaconnection

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