The growing audience for online content is driving advertising money to follow it. According to eMarketer, online video brings in more actual revenue per viewer than television ($0.17 per person per hour of viewing versus $0.13 on TV). In addition to the online pre-roll ads and ads in the middle of longer shows, advertisers are using the formula from the early days of TV when one advertiser would sponsor and underwrite a particular show. Paramount Studios (owned by Viacom) is now working with Mountain Dew to create its first web series Circle of 8, debuting on MySpace in October while NBC just launched the online show CTRL in conjunction with Nestea.
Also fueling the growth of online video is the emergence of mobile video – with iPhones and other smart phones being another unique platform for viewing online content. According to Nielsen, 13.4 million people watch mobile video every month, up from under 9 million a year ago. Moreover, social networking sites such as Facebook and MySpace are also greatly expanding the reach of online video.
Even without the proper amount of Internet VC investment, this field is growing rapidly. It is time for the Internet VC investor world to wake up! Now is the time to invest and enter aggressively into this field. If not, many investors will be kicking themselves for missing these enormous opportunities. Either Internet VCs will enter early on the ground level in the online video field and reap an amazing ROI or spend an outrageous amount later to have a small percentage of a booming company and a very small ROI.