Web industry prognosticator eMarketer is far less bullish on online video than it was roughly six months ago. The firm projects that ad spending in online video will climb to a healthy $505 million this year. But that figure represents a whopping 64 percent decline from the $1.4 billion prediction for Web video spending 2008 that eMarketer made in February–and just 2 percent of the dollar pool for online advertising overall.
The revised forecast for online video spending marks the second such reduction this week for eMarketer. On Aug. 13, the firm said it expects online ad spending to reach $24.9 billion, down roughly a billion dollars from a forecast issued back in March.
“Even as video becomes the great growth area for Internet advertising, there’s a major disconnect between the amount of time people spend with short-form video, especially user-generated, and the ad dollars that accompany such video content,” said eMarketer senior analyst David Hallerman. “However, as media companies change their business model, putting more and more professionally created video content online, the audience, and related ad dollars will increase dramatically.”
Indeed, the rise in the amount of professionally produced, often long-form video on the Web is inciting users to watch more videos each month on a regular basis. According to a recent comScore report U.S. Internet users viewed more than 12 billion online videos back in May, up 45 percent versus the same month in 2007. Overall 142 million U.S. Web users watched an average of 85 videos that month, said comScore.
eMarketer Tempers Video Spending Projections
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