Rich Media: 20% of Online Ads by 2012

eMarketer predicts that spending on online rich media and video ads will account for nearly one-fifth of all online ad spending by 2012, up from 9.7% of all online ad spending in 2007.

"Video ads command higher prices than static display advertising," says David Hallerman, senior analyst at eMarketer. "That both boosts overall ad spending and draws in more dollars from traditional brand marketers, who have been reluctant to commit much of their ad budgets to the Internet."

Ongoing experiments with video ad formats and a lack of standards have, in part, kept the online video ad market from even stronger revenue growth.

Other hurdles have included limited high-quality video content to attract big advertisers and unresolved issues such as traffic measurement, which will be needed to gain the trust of the most deep-pocketed marketers.

As those problems are solved, spending will increase. eMarketer predicts that US online rich media and video ad spending will total more than $9.4 billion in 2012, which is more than four times as much as the 2007 spending level.