ValueClick Enters Web Video Market

December 05, 2006

By Brian Morrissey, Adweek

NEW YORK -- While Web video has been dominated by big sites like YouTube, ValueClick is betting 2007 will be the year that more small sites add streaming content.

The Westlake Village, Calif.-based advertising network this week begins offering the 13,000-plus sites in its network the opportunity to run in-stream video spots, complementing the banner ads the company already provides.

ValueClick is the latest entrant into the booming Web video market, which eMarketer expects to grow from $650 million in 2007 to $1.7 billion by 2009.

While major destinations like YouTube, Yahoo, MSN and Google (in addition to high-traffic sites like CNN.com and ESPN.com) account for a large portion of Web video views, ValueClick sees an emerging market of small providers, such as Live365.com and GetRadio.com. Its network approach will allow advertisers to run campaigns that reach millions of viewers dispersed on small sites.

In a survey of its publishers, 20% already have video and 50% plan to in 2007. Yet most remain too small to handle or sell video placements on their own, said Dave Yovanno, general manager of media at ValueClick.

"It's very early in the market for video representation," he said.

The long tail of small sites is the focus on several Web video advertising startups, including ROO, Tremor, Broadband Enterprises and Brightcove. In its first month, ValueClick expects it will stream over 100 million video ads.

ValueClick would have a leg up on most of those because of its existing relationship with Web publishers who are moving from mostly text-based offerings, monetized through banner ads, to broadband content with in-stream placements, Yovanno said.

The company is experimenting with different forms of video spots, including pre-roll, post-roll and placements around the video player. While it will sell placements on a cost-per-thousand basis of about $20, ValueClick will remain focused on delivering measurable results over pure branding, Yovanno said.

"We're absolutely focused on providing the steak with the sizzle," he said.