In the race to stay relevant, DoubleClick, Atlas, Mediaplex (ValueClick) and TruEffect have all brought video ad serving to their arsenal of rich media ad serving. DoubleClick made its November 6th splash with their media announcement following Atlas’ announcement a week earlier. ValueClick followed-up with their announcement on December 4th and TruEffect released their video ad server to its clients at the end of the third quarter. All four ad servers now promote their video ad serving capabilities to existing and prospective clients.
So video is now another form of rich media that ad servers like Zedos, Poindexter/[X+1], Adjuggler and other tier-two ad servers will likely catch-up on with shortly as well. The bigger question, however, is how many advertisers will use this capability in 2007. We have all read the reports and seen the projections that video is the next big thing. And it will be. But how soon and how fast is harder to predict. The cost to produce video ads is significant in comparison to other forms of rich media. And to create multiple versions of creative to promote campaign optimization will result in production costs that will break some advertisers’ bank. Video advertising in 2007 will likely be reserved for only the big-budget advertisers or those leading-edge early adopters who want to throw money at the newest technology because their target audience is going to be receptive to the new media (younger demographic, YouTube, MySpace, etc.).
But in the meantime the ad servers have brought video ad serving to the market and have added it to their offerings. Pay attention. The cost structure of video ad serving is entirely based on the bandwidth that is required to serve a video ad. A properly priced service should correlate to the size of the files. When you buy traditional ad serving, like banners, with file size limitations of 20K vs file size limitations of 40K you should see better rates. If you are adding video file size limitations of 100K or 1MB, you will see it in better CPM rates. When you negotiate your fees with the ad server, look at the bandwidth limitations you have and try to calculate the incremental impact that the file size is having on your proposed rate for video ad serving. Be prepared to see all kinds of premiums thrown in for the newest, greatest thing – video ad serving – from the likes of DoubleClick and Atlas (probably Mediaplex too) so buyer beware. But consider them ‘junk fees.’
A knowledgeable buyer should start with their current ad serving fees and look at the file size limits and negotiate based on the increase in file size limits that you will require to obtain video ad serving. Don’t let the added fees get dumped on you. The ad servers want to see these new services get used as badly as you want to use them. Maybe more so. Early adopters have buyer advantage.
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