A Digital Video Inflection Point

Over the past few weeks, I’ve had the oppor­tu­nity to speak about the dig­i­tal video land­scape at con­fer­ences with BeetTV, VideoNuze, and Bright­cove, and I wanted to share some obser­va­tions.

helfand_brightcove-1024x768Dig­i­tal video is expe­ri­enc­ing an unprece­dented out­pour­ing of atten­tion, inno­va­tion and cre­ative energy. Even with the chal­lenges that come with any emerg­ing busi­ness oppor­tu­nity, there are many rea­sons why dig­i­tal video is at an inflec­tion point and poised for extra­or­di­nary growth. Here are five:

1. Con­sumer behav­ior is chang­ing in fun­da­men­tal ways. Indi­vid­u­als are being empow­ered with devices, like tablets and gam­ing con­soles, which offer the abil­ity to more eas­ily con­sume media. Over three-quar­ters of US adults will watch video monthly by 2014, and pro­fes­sional con­tent con­sump­tion is cur­rently grow­ing at three times that of user-gen­er­ated con­tent. Mar­kets respond to con­sumer-led trends, and this one shows no sign of slow­ing down.

2. The crit­i­cal path items for dig­i­tal video are known. Recently one of the largest global media com­pa­nies told us that they employ five engi­neers for mobile video deliv­ery for every one engi­neer they employ for desk­top video. That 5-to-1 ratio isn’t scal­able or sus­tain­able. While all crit­i­cal path items are not yet solved, hur­dles, like device frag­men­ta­tion, improv­ing user expe­ri­ence, and devel­op­ing bet­ter met­rics to buy and prove the value of video adver­tis­ing are being tack­led actively.

3. Mon­e­ti­za­tion pos­si­bil­i­ties are evi­dent and evolv­ing. In a recent sur­vey, con­sumers between the ages of 15 and 24 — tomorrow’s main­stream — were the most likely to engage with dig­i­tal video adver­tis­ing, sug­gest­ing that indi­vid­u­als are grow­ing increas­ingly com­fort­able with ads while watch­ing TV on desk­tops and devices. Dig­i­tal video ad loads are still small rel­a­tive to TV, point­ing to a mon­e­ti­za­tion mul­ti­plier effect as more pro­fes­sional con­tent comes online. A recent study also shows the grow­ing pop­u­lar­ity of paid media con­sump­tion on tablets: 18% of con­sumers use tablets for view­ing paid video con­tent, up from 11% a year ago. We are head­ing toward a per­fect storm of mon­e­ti­za­tion oppor­tu­nity.

4. Major pro­gram­mers and oper­a­tors are lean­ing for­ward. Large media com­pa­nies are moti­vated by con­sumers’ desire and abil­ity to access con­tent in new ways, and are respond­ing with inno­v­a­tive tools like the Xfin­ity App for iPad. For sev­eral major upcom­ing sport­ing events, you¹re going to see cre­ative part­ner­ships between broad­cast­ers, dis­trib­u­tors and Adobe that allow view­ers to access con­tent (live and VOD) across dif­fer­ent plat­forms and device types.

5. Adver­tis­ing Fol­lows Engaged audi­ences – and Dig­i­tal Video Engages. Pro­pri­etary research from Adobe Audi­tude shows that mid-roll video ads, the most engag­ing com­mer­cial posi­tion, eas­ily out­per­form com­ple­tion rates of pre-rolls and post-rolls. With an 87% com­ple­tion rate, mid-rolls are per­form­ing close to 30% bet­ter. Pro­fes­sional con­tent with engag­ing, TV-like ad expe­ri­ences rep­re­sents tremen­dous oppor­tu­nity. The cre­ative pos­si­bil­i­ties for bet­ter dig­i­tal video and mobile adver­tis­ing expe­ri­ences are end­less, and excit­ing.

To posi­tion Adobe’s cus­tomers on the lead­ing end of these evolv­ing trends, we are thrilled to be con­tin­u­ing our work build­ing Project Prime­time. Adobe’s Project Prime­time helps media com­pa­nies bring their lin­ear, live and VOD con­tent online to any con­nected device with greater rev­enues from ads and sub­scrip­tions. By com­bin­ing Adobe’s stream­ing, pro­tec­tion, adver­tis­ing and ana­lyt­ics tech­nolo­gies, Adobe is in a unique posi­tion to address the most sig­nif­i­cant chal­lenges that will enable the trans­for­ma­tion of dig­i­tal video.

Jeremy Helfand, Vice President of Video Solutions

About Jeremy Helfand, Vice President of Video Solutions

Jeremy Helfand is a digital media industry veteran with nearly 20 years of experience shaping infrastructure, strategy, and technology around profitable advertising-driven businesses. As the former CEO of Auditude (acquired by Adobe in 2011), Jeremy was responsible for the overall implementation of video ad management and monetization technologies for premium publishers and media companies. Following the Auditude acquisition, Jeremy now serves as vice president of Adobe Primetime, leading the global go-to-market strategies for the company’s video publishing, advertising and data management solutions. Prior to Auditude, he was the President of United Online’s Media Group, managing all advertising and partnership revenue including the launch of their audience platform, Adcurate. Prior to this, he served as SVP/GM at Advertising.com (acquired by AOL).

Show Comments

Hide Comments

Leave a Reply

Your email address will not be published. Required fields are marked *