TubeMogul

TubeMogul was the first dedicated online video analytics firm, enabling content creators to track the performance of their videos over a number of online video services.

But that clearly wasn’t enough for the company, which has now launched Play Time, its video advertising platform. And the firm is already seeing results from the year-long beta.

Play Time

According to MediaWeek, TubeMogul is using its experience in video analytics to its advantage with Play Time. The company is aiming to be “far more open and effective than other video networks” and “the largest video ad network in the world.”

Which are big ambitions indeed, but TubeMogul is confident that by using the data from its analytics platform it can target video ads at exactly the right people.

Beta Testing Results

TubeMogul has been testing Play Time over the past year, running campaigns for the likes of 20th Century Fox, Coca Cola, Nestlé, and Kmart. Which are very big names with some very big advertising bucks to play with.

According to NewTeeVee, the company is already reporting higher revenues from this new part of its business than the analytics service it has been specializing in for the last few years. So expect this to become a larger part of the company’s business than it is currently is.

Indeed, Tubemogul has reportedly already started buying “inventory from the top 250 comScore sites.”

Conclusions

Rivals are seeing TubeMogul’s move into video advertising as a conflict of interests, but i really don’t see why. The company is merely attempting to use its experience and the data it has gained from one part of its business to its advantage in another field. And if the results from the beta period are anything to go by, it’s proving a successful strategy.

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EyeView

The Web offers a whole new platform for advertisers to sell their wares. But as with every other medium, there are ways of increasing the success of campaigns.

EyeView offers video solutions for advertisers, having spent the last three years working for and with big names such as Google, YouTube, Yahoo!, HP, and eBay.

EyeView wants to know how much you know about works and what doesn’t in the realm of video advertising, and has created a Video Marketing Quiz which everyone can take.

Video Marketing Quiz

EyeView’s 2010 Video Marketing Quiz contains eight questions pertaining to the way video advertising can be used on the Web.

The questions cover the following elements, as well as many more:

• Whether auto-playing a video advert is more effective than letting the viewer decide when to start the promo.
• Whether video adverts are more effective than static banner ads.
• Whether the gender of the video voiceover person affects engagement.
• Whether the way the video advert is presented really affects click-through rates.
• Whether a lengthy video – more than two minutes – is a big no-no.

I took the quiz myself and only scored four out of a possible eight points. Mainly because as a consumer rather than marketer myself, I answered intuitively, and not all the answers proved to be so.

Conclusions

EyeView’s Video Marketing Quiz offers an intriguing glimpse at a world which most consumers and Web users will know little about. Which is why companies such as EyeView exist in the first place: to help companies and brands maximize their use of video advertising.

Google’s YouTube

Google acquired YouTube for a whopping $1.65 billion in October 2006, just 18 months after the domain name was registered. Google CEO Eric Schmidt has since stated he thinks the company paid way over the odds for the startup, but that it was a necessary purchase.

What Google got was a YouTube that’s very different than the one we see today. Piracy was still rife, with unauthorized clips all over the site. Although these were eventually removed it took a lot longer than it does these days.

YouTube Revenue

YouTube has likely never made money for Google, at least if analysts’ previous attempts to estimate the incomings and outgoings of the company are to be believed.

However, according to MediaMemo, Citigroup’s Mark Mahaney has a different view. He estimates that YouTube made around $727 million in revenue in 2009, will make $945 million in 2010, and $1.1 billion in 2011.

He doesn’t mention the expenses YouTube carries with it, which are likely to be vast. However, with those sorts of revenues there’s a strong chance that YouTube is either already turning, or about to turn, a profit for Google.

Mahaney’s methodology was simple: transpose MySpace’s revenue-to-page view ratio with YouTube’s. Which is hardly scientific but is as good a method as any with Google continuing to keep official figures confidential.

Google Vs. Viacom

Today has also brought new news in the continuing legal battle between Google and Viacom. The latter sued the former for $1 billion in damages way back in 2007, alleging “massive intentional copyright infringement.”

Viacom’s complaint is that Google profited from the 160,000 unauthorized clips on the site before new methods were introduced to combat uploading of pirated video clips.

According to CNET, both sides are filing motions for summary judgment. In essence, this means that the talking is over with both sides now confident enough to put their case forward. It’s now up to the judge to decide the next course of action but the case is likely to come to a head very soon.

Vudu

Vudu is one of the many companies which started out offering a set-top box for serving Web video to consumers. When that strategy didn’t work, it became one of the many companies which switched to focusing on software rather than hardware.

This means Vudu’s service is now included on a number of other Web-connected devices instead, including televisions and Blu-ray players. The Wal-Mart deal will inevitably affect deals in place with Mitsubishi, Sanyo, Sharp, and Toshiba, but quite how isn’t clear.

Wal-Mart

Wal-Mart is one of the largest chain of department stores in the States. It also operates under different names outside of the U.S.

This acquisition of Vudu isn’t the company’s first attempt at offering video streaming. In 2007, Wal-Mart began to offer customers TV and movie downloads in partnership with Hewlett Packard. But it wasn’t successful, and the service was stopped just a year a later.

Wal-Mart Acquires Vudu

After months of speculation concerning an acquisition of Vudu, Wal-Mart has bitten the bullet and done a deal. The New York Times reports that Wal-Mart beat the likes of Best Buy, Amazon, Comcast, and EchoStar to grab Vudu.

No details of the deal have been revealed, but MediaMemo is claiming Wal-Mart will pay in excess of $100 million for Vudu. Vudu will become a wholly-owned subsidiary of Wal-Mart but continue to develop its App Platform.

Eduardo Castro-Wright, vice-chairman for Walmart, said:

“The real winner here is the customer. Combining VUDU’s unique digital technology and service with Walmart’s retail expertise and scale will provide customers with unprecedented access to home entertainment options as they migrate to a digital environment.”

Conclusions

Wal-Mart is taking a bit of a gamble with Vudu, especially paying the kind of money being reported. There’s no doubt this is a brilliant time to enter this market but whether Vudu is the right option remains to be seen.

What is clear, however, is that both companies will benefit from the deal, at least in the short-term.

YouTube Video Rentals

YouTube signaled its intent to start charging for some videos last September, with rumors of a movie rental service priced at $3.99-a-film emerging.

The trail then went cold until January of this year when YouTube officially released the first five offerings under the new service. Until then, the service had merely been trialled by Google employees.

Sundance Film Festival Trial

The first offerings were The Cove, Bass Ackwards, One Too Many Mornings, Homewrecker, and Children of Invention, all independent films from the 2010 Sundance Film Festival which would otherwise have struggled to find an audience.

The trial ended when the festival did, and the total revenue brought in by the trial was $10,709.16. This isn’t a huge amount of money, especially for a site as popular as YouTube or a company as big as Google.

But it was a good enough start to justify an expansion of the service, proving that should the right content, and a fair amount of it, be made available that it could prove to be another way of bringing in revenue to YouTube. Which, lest we forget, has yet to turn a profit.

Expanding The Library

NewTeeVee now reports that YouTube has expanded the service to include more videos, more content providers, and a greater variation of genres. Rather than just independent filmmakers, genres such as sport, travel, cooking, and education are now also available.

Not that YouTube is publicizing the service yet. In fact, it’s all being rolled out very quietly and with no fanfare. Then again, the video rentals service is still in beta, and will likely be for some time to come.

Conclusions

YouTube obviously has high hopes that there’s a profitable future in offering video rentals, and not just in the form of movies. And I don’t doubt this is the case.

Although most people will still only use YouTube for the free UGC that is at its core, there is a significant proportion of people happy and willing to pay for content, if that content is what they’re seeking.

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The Present

At the present time, online video viewers are lucky. And I say that as one of them. Most video sites are free, with advertising (both text and video-based) paying the bills and ensuring we get to watch good content without having to pay.

What’s more, the advertising is nowhere near as intrusive or as frequent as it is on traditional television. There’s probably four times as much advertising on TV as there is on the Web, on average.

However, according to AdAge, that could soon be set to change.

The Future

Starting in September, Nielsen intends to unify its data collecting to include both TV and the Web. So the advertising attached to a particular show, whether it be online or off, will be noted. This may not seem important to us, the end consumers, but from February next year it will be.

That is when the data is expected to begin being used for advertising negotiations. And to make the data accurate for this purpose, shows broadcast online would have to show the same ads as when they’re shown on TV. Which will mean a significant ramping up of advertising against online video.

TV Vs. The Web

This is all part of the convergence which is happening between traditional TV and Web TV. More and more consumer electronics are Internet-enabled, and that means people have multiple options for watching TV other than the box in the corner.

Time Warner and Comcast’s ‘TV Everywhere’ is a reaction to that, giving consumers more viewing options while still retaining the ability to squeeze cable subscriptions out of people’s pockets. As TV and online video meld into one, more advertising is almost guaranteed.

Keeping It Free

That’s not necessarily a bad thing, as advertising is the only way content is going to be made available for free in the future. There are only two options for media companies seeking to make a mint from the Web: a subscription paywall or enough advertising to keep the content free.

And I know which one I, and the majority of other people, would choose.

Conclusions

So I say increase the amount of advertising. So long as it coincides with a commitment to keeping the sites free and an increase in the amount of premium content which Web TV viewers are crying out for.

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Hulu – From Zero To Hero

After a short beta, Hulu launched fully in early 2008 with few people predicting it would become the success it has done. But the last two years has seen the service grow in popularity by a huge amount, with only a slight dip in the middle of last year.

But that trend now looks to have been reversed, with Hulu once again growing. With Disney now on board, and content partners and sponsors increasing in number, things are definitely looking good for Hulu.

One Billion Videos

The last time we looked at Hulu usage stats the monthly record was 924 million streams. But that has now been superseded, with ComScore reporting Hulu served more than one billion videos in December. In an interview with USA Today, Hulu CEO Jason Kilar described it as “a great milestone.”

At the end of 2008 Hulu was serving 240 million videos a month. In the space of a year that figure has been quadrupled, which is growth I think most sites (with the exception of Google and YouTube) would be happy with.

Paid Vs. Free Options

Hulu may well already be profitable but the company is refusing to disclose this information. However, profitable or not, Hulu is looking at new ways of making money. Last year the first talk of charging for access, with Rupert Murdoch being the driving force behind the effort.

Kilar has now promised there will always be a free version of Hulu but that still leaves a lot of scope for charging for access.

Forrester Research analyst James McQuivey believes Hulu is eyeing up two different pricing tiers. $4.99 a month would buy viewers an ad-free Hulu, with $14.99 a month ending the four-episode limit and open up complete seasons and a huge back catalog of content.

Conclusions

This seems a sensible approach: keeping Hulu free and ad-supported for those who want it, while also giving people more options. The premium package will be most attractive to people who currently buy box sets of TV shows on DVD or Blu-ray.

2009 was a good year for Hulu and I suspect 2010 will be even better.

YouTube Trials Rentals

YouTube has now officially entered the market for movie rentals, having offered movies from the Sundance Film Festival for $3.99 apiece for the ten days that the festival lasted.

YouTube has had a relationship with independent filmmakers for a while now, as it offers another opportunity for them to get their work out there and in the eye-line of a bigger audience. And audiences don’t come much bigger than YouTube’s.

The trial run has now ended and the results are in.

Movie Rentals Trial Results

According to the New York Times, YouTube’s movie rentals trial ended with the company bringing in $10,709.16 in revenue. The five films combined were bought and viewed a total of 2,684 times.

This breaks down further into the results for the five films that were initially offered. The Cove was watched 1,103 times; One Too Many Mornings, 340; Homewrecker, 355 times; Children of Invention, 490 times; and Bass Ackwards, 396. Each was available for $3.99.

Success Or Failure?

Some have suggested this total signals a failure for YouTube, but I disagree. This was only ever intended as a small trial with films only a niche audience would appreciate.

What’s more, YouTube didn’t make a big deal out of it, letting the experiment find its own course rather than be influenced by high-profile ads on YouTube and its parent company Google.

YouTube spokesman Chris Dale even stated, “It definitely exceeded our expectations given all the barriers.” Which implies YouTube is happy with the results and has seen enough revenue and, more importantly promise, to up the ante next time around.

Conclusions

$10,000 isn’t much money in the big scheme of things, but it shows there could be a future there for YouTube to offer movie rentals in a bigger way in the future.

As always content is key. Independent films are one thing but if YouTube could make deals with the big studios for recently-released movies then the prospects move onto a different plain entirely.

And I have no doubts YouTube is already making those deals.

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Apple Tablet Imminent

Apple is expected to launch its new Tablet PC – likely to be called the iSlate or the iPad – at a special media event tomorrow (Jan. 27). The Tablet is being touted as a revolution in home computing and in the way we will consume media in the future.

But pricing is going to be the key to this vision becoming reality. And that doesn’t just mean the pricing of the Apple Tablet, but also the pricing of the content Apple is expecting to be read, viewed, listened to, and played on the device.

TV on iTunes

The FT is reporting that Apple is seeking a deal with the big TV networks in the States. Most episodes of TV series are currently priced at $1.99 on iTunes, but Apple is thought to want to slash the price to just 99 cents.

This is because TV currently only plays a minor role in the success of iTunes, with music being the big seller. Apple struck a deal with the music industry in 2003 which saw individual songs go on sale for 99 cents apiece. And business has since skyrocketed.

Talk of a monthly subscription service is also continuing but doesn’t seem to getting very far. Hulu might actually beat Apple to it.

Apple Tablet?

The Tablet PC is expected to be a cross between the iPhone and a laptop, with one large touchscreen, a new version of the iPhone OS, and the capability to browse the Web and be an all-in-one multimedia device on the go.

Apple clearly wants to make it the only device anyone needs to read newspapers and books on, listen to music on, and watch TV and films on. All while on the move and connected to the Internet via Wi-Fi.

Network Interference

The networks are thought to be resistant to these pricing changes, worried that they will see less revenue and that they would adversely affect numbers and demand on traditional broadcast television.

However, as Apple has explained, price cuts would likely ramp up demand on iTunes, and help combat piracy. The fact is that piracy would almost disappear overnight were consumers being asked to pay a fair price for content.

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Conan Vs. Jay

The Tonight Show is an American institution, and its presence in the TV schedules, and who is presenting it, are subject to debate and controversy. It happened with Dave Letterman in the 90s and has now happened with O’Brien.

Conan took over The Tonight Show from Jay Leno last year, with the latter hosting his own prime-time chat show. But eight months on and NBC decided neither show was pulling in the expected ratings, which started a long battle which ended with Leno taking The Tonight Show back and O’Brien leaving the network altogether, albeit $33 million richer.

O’Brien’s Future

O’Brien is free to join another network from September 2010, and there are likely to be plenty after his skills as a presenter and the audience he’d no doubt bring with him.

However, Conan does, of course, have another option: taking his show to the Web and forgoing the need for a network altogether. After his experience with NBC, this must be an attractive option for O’Brien, especially as it would give him complete control over his destiny and see the rules on what he can say and do relaxed.

To Web Or Not To Web

The New York Times made the case for O’Brien to move to the Web, arguing that the Internet means people consume television in different ways now anyway. The whole argument over The Tonight Show centered on its time slot, but that is a somewhat moot argument when DVRs and online video rule the roost.

MediaPost took a different view, arguing that the world isn’t yet ready for the likes of O’Brien to take his show exclusively to the Web, mainly because it would be a lot harder to sell advertising for a Web-only show than it is for a traditional TV show. And even if the advertisers do bite, revenues would still be a lot less.

NewTeeVee estimates that The Tonight Show was worth about $200 million a year to NBC based on the 2 million viewers it got. Viewing figures would drop dramatically on the Web, and with lower CPMs expected (although not guaranteed), revenue would probably be limited to $20 million a year. And I’d suggest that’s generous.

Conclusions

There is no doubt in my mind that the Internet is becoming a pervading force for all media, TV, movies, and music. And Web-only offerings have seen some success, with Seth MacFarlane’s Cavalcade of Cartoon Comedy immediately springing to mind.

However, it’s probably too soon for someone with the stature of Conan O’Brien to make the move lock, stock, and barrel. Give it a few more years though and we’ll definitely be at that point.