User-Generated Video Ad Revenue Fails to Measure Up

Telecom News Editorials Reports Glossary

7:30 am on August 10, 2008 | Category: Business, Web Services, Television

User-generated content will account for close to 50% of online video streams viewed over the next five years, but won’t translate into advertising revenue at the same rate as other videos, according to a new report (entitled Online TV and the Future of Digital Video Advertising) by research firm, TDG.

Amateur videos generated by internet users will generate only 4% of digital video-related ad revenues through 2013, leaving streamed television shows, movies, and made-for-internet content with a disproportionately high share of revenue.

Traditional cable TV operators, meanwhile, will increasingly take advantage of digital channels, delivering web-based video content directly to users’ TV sets. Programmers will bypass traditional pay-TV “gatekeepers” via online distribution, “ironically, by the pay-TV operator,” according to the report.

TDG expects the combined total of online video advertising revenues to increase almost twenty-fold over the next five years, from $590 million in 2008 to an estimated $9.94 billion in 2013.