Online Video Still Needs Scale to Attract More Advertising

The online-video market represented about $1.8 billion worth of ad spending in 2011, with half of that going to just two players: Hulu (about $300 million) and YouTube (about $600 million), according to Brian Wieser, an analyst at Pivotal Research Group, and reported by Ad Age. 


Most of the advertising growth in online video could happen because it shifts spending from the $70 billion spent annually on TV ads in the U.S. market. 


High-quality video lots of people want to watch might be necessary. But it is not sufficient for success, simply because video advertisers want large audiences.


And the simple fact is that not many providers have both attractive programming and large audiences. Subscription revenue is dominated by Netflix.