YouTube Introduces Video Advertising

NEW YORK, August 22:
YouTube today introduced video advertising on the site, opting for “overlays”
as opposed to pre-rolls where ads are featured at the beginning of a clip.

The overlay ad appears
at the bottom of a clip 15 seconds after the video begins and disappears within
10 seconds if the user doesn’t click on it. The user can also opt to close the
ad. If the user clicks on the campaign, the video clip they were watching
automatically pauses and the full ad appears.

“What we have come up
with is a user-controlled ad format that is engaging,” said Eileen Naughton,
Google’s director for media platforms, in the New York Times. “We want our users to be able to accept and
choose what type of advertising they engage in.”

Shiva Rajaraman, the
product manager for YouTube, told the AP that based on internal research, more
than 70 percent of people give up when they see a pre-roll. By contrast, less
than 10 percent decide to close an overlay.

Initial video
advertisers on YouTube include 20th Century Fox and New Line Cinema; about 50
companies have signed up for the new service, Reuters indicates. The clips that
advertising will be featured in have all been legally licensed to the
Google-owned site; no ads will appear in user-generated content. Revenues from
video advertising on YouTube will be shared with the content owners.
Advertisers will be charged $20 for every 1,000 times the ad is displayed.