In a week that saw Yahoo stave off Microsoft’s advance, Yahoo themselves went shopping. They obviously found something they liked, and they paid $160 million to acquire Maven Networks, a web company that markets a management package that tracks and manages advertisements in online videos. So we’d guess that we’re in for more commercials on the web….
Maven’s technology has been implemented by Fox News, CBS Sports, Hearst, The Financial Times and Gannett. Maven’s products show and distribute videos. Maven also owns some interesting technology that actually identifies just the right moment during a video to show a particular ad.
Yahoo is jockying to establish itself as a major distributor for many types of online ads and said the acquisition would help it sell and deliver video ads not only on its own site but on other sites across the Web.
â€œWe really see this deal with Maven as creating one of the most robust video platforms in the industry,â€ said Hilary Schneider, an executive vice president who oversees Yahooâ€™s network of advertisers and publishers. Obviously Microsoft itself is interested in Yahooâ€™s advertising capabilities.
Yahoo plans to combine Mavenâ€™s advertising technology and video ads with new formats, like clickable ads, which occupy only a small portion of the video player, along with interactive ads, which open with a short message and then reduce to a small strip. Yahoo stated that both formats have proved far more effective than preroll ads, which are ads that appear before the content the viewer is trying to see.
The market is large and growing. Advertisers are spending just $775 million on online video ads today, still just a fraction of the $20 billion spent on Internet ads in the United States last year. But analysts expect that video ads will become far more pervasive as technology improves, allowing brand advertisers will flock to the web with rich media online ads.
The future looks bright for onliner advertisers, but there is a catch: UCG. Advertisers may balk (and many have complained) at attaching their brand to content created by consumers. UGC is difficult to monitor for appropriate content. That is a perception that Google, which owns the YouTube video-sharing site, is trying to fight. And Google has a lot to lose.
Today, Google will hold an event in New York to persuade companies with large ad budgets that YouTube has lots of authorized clips from established media companies that should be attractive to advertisers. YouTube is selling overlay ads, which run on the bottom of videos and look similar to formats that Maven has used.
As for their part, Maven has avoided placing ads on UGC content, opting to strike deals with major media companies. Advertisers generally do not want to be associated with user-generated videos because they donâ€™t know what it contains.