Boomtime for Video Ads?

Here’s another indicator that the online video ad market is surging: twice as many video ads were served in the first quarter compared to the same period in 2010.
At least based on the roughly 40 percent of the ad market that uses Vindico to serve its video ads. According to Vindico president Matt Timothy, the company, which is angling to become Web video’s default ad server, delivered 4.8 billion impressions, a 100-percent increase in volume compared to the first quarter of last year.
That growth has helped Vindico, which along with parent company BBE was sold to Specific Media last fall, enjoy revenue growth of 300 percent in the first quarter of this year, added Timothy.
“The volume to us has just been exploding,” said Timothy. “Major advertisers are doing a lot more than dabbling. We’re seeing more treating video as video. We are a very good bellweather for the industry.”
While eMarketer and other analysts following the space have all predicted robust growth for online video advertising, Vindico’s data offers more tangible proof that demand is soaring. The company works with the majority of the major digital ad agencies and claims to handle video serving for six of the top 10 TV advertisers and 21 of the top 50.
However, eMarketer is predicting a 38-percent spending growth in 2011. With Vindico seeing impression volume double, it could be an indication that pricing is slipping overall.
Might the market be bifurcating or becoming less premium? Many online media insiders have been predicting for years that online video spending would steal dollars from TV. Instead the just-kicking-off TV upfront is expected to see double-digit growth for the TV networks.

“Some of that upfront money is spilling into TV,” said Timothy. “But what is happening is that TV and Web video spending are becoming more aligned. I don’t see pricing going down. For big publishers, there is never enough video inventory, but there is always too much display.”

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