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Internet Video Advertising Spending in the US Will Nearly Triple to $640 million by 2007

Broadband adoption at home is a key driver of online video advertising's growth

November 29, 2005 -- NEW YORK, NY -- Internet video advertising spending in the US will nearly triple to $640 million in 2007 from this year's $225 million, according to a new Online Video Advertising report from eMarketer. By the end of the decade, advertisers will spend at least $1.5 billion on video ads online.
"Online video advertising used to be an oxymoron but no more," says David Hallerman, Senior Analyst at eMarketer and author of the report. "Television and the Internet are developing new ways to complement each other."

Internet video has the greatest potential to blend several hot marketing elements: paid search, branded entertainment, viral marketing, consumer generated media, behavioral targeting, Web site brand marketing and online gaming.

"Video represents common ground for television and the Internet, not a field of battle," says Mr. Hallerman. "Winner-take-all is not the name of the game."

Broadband adoption at home is a key driver of online video advertising's growth. According to eMarketer, there will be more than 69 million US broadband households by 2008, more than doubling 2004's figure of 34.3 million.

Today, more than half of US online households connect via high-speed access, and by 2008, eMarketer says, more than half of total US households will be on broadband Internet access. This essentially provides advertisers with a new online 'mass' audience.

"All this is very good news for advertising agencies," says Mr. Hallerman. "Now the products they are best at creating - film and video commercials, or 'spots' - can be transferred to a new medium, new markets."

"In real-world terms, what that means is marketing campaigns can extend TV's reach to the online space, enticing the target audience to spend more time with a particular brand," says Mr. Hallerman. "It also means using the Internet's ability to track consumers in ways that match up television commercials with online (and offline) activity."

He adds: "And it means combining the content offered on the tube with the control individuals take for granted on the Internet."

eMarketer's Online Video Advertising report answers these questions:
What types of advertisers should be looking to Internet video?
When will online video advertising become mainstream?
How important is video content on the Internet for the growth of video advertising?
Is the Internet competing with TV, or are they complimentary?
What factors stymie the usage of video for online advertising?
And many more...

For more information on eMarketer's new Online Video Advertising report, visit eMarketer.

About eMarketer
eMarketer is "the First Place to Look" for market research information related to e-business, online marketing and emerging technologies. eMarketer aggregates and analyzes e-business research from over 1,700 sources and brings it together in one place. This research is presented in analyst reports and the "eStat Database" the most comprehensive compilation of up-to-date e-business and online marketing statistics in the world. For more information, visit eMarketer.

Source: eMarketer

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