Old conventional wisdom: There’s big money in user-generated video! New conventional wisdom: There’s little money in user-generated video, because advertisers don’t want to touch it — that’s why YouTube and most other video services are making deals with pros.
But News Corp.’s (NWS) Fox Interactive Media, whose MySpace is huge repository of use-gen video, is going to try to extract something out of all those clips, anyway. The plan: Starting next year, they’re going to sort through the amateur videos posted on the site, and present the most popular – and most palatable – ones to advertisers.
“We’ll take a look at the most popular videos, have eyeballs on them to make sure they’re clean, and add them to a cue for advertisers to consider,” said FIM Chief Revenue Officer Michael Barrett at UBS. So how will that work?
The ads may take different forms: Barrett talked about translucent “overlays,” a commercial ticker or “freeze video,” when a user has to watch an ad to unfreeze whatever they’ve been watching. Barrett said ad rates for video advertising on user-generated video could range from $2 to $14 per thousand impressions.
Barrett, who’s under significant pressure to hit aggressive sales targets, downplayed the venture, calling it an experiment and one that the company didn’t need to succeed. – MySpace still makes money from use-gen video by selling graphic advertising that isn’t related to the video itself. The trickiest part he says, won’t be convincing advertisers to try the selling against the video, but to make that the ads are relevant: “Just because its a stupid pet trick doesn’t mean Ralston is interested,” he said.
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