For those of us selling in-stream video advertising to advertisers and agencies the good news about budgets moving into our space keeps coming. According to an Accustream iMedia Research report $420 million was spent in pre-roll ads in 2007. Based on conversations that I have had with both advertisers and agencies, in-stream will see a substantial increase in budgets in 2008 as well.

Compared to the $65.3 billion spent in 2006 on television advertising, pre-roll is still a blip on the screen. Over the years numerous companies have discussed the need for establishing standards that will make planning and buying online video advertising easier for everyone. In late 2007 the Interactive Advertising Bureau (IAB) did just that. Led by Jeremy Fain, Senior Director of Industry Services, 120 companies have come together to form the IAB's Digital Video (DV) Committee.

Participating companies represent the entire online video advertising ecosystem, including publishers, networks, research firms, technology providers, and agencies. The DV Committee's goal is to identify essential standardization initiatives for online video advertising and then educate stakeholders on the steps being taken to ensure accountability within the medium.

The DV Committee's first white paper, "A Digital Video Advertising Overview", was released on Jan. 24. DV Committee representatives presented findings at an IAB seminar on Feb. 13 in New York City. Mike Hurt from Microsoft and co-chair of The DV Committee summed up the collective feeling when he said, "I am amazed to be on a committee that has me actively engaged with Google, Yahoo and a number of competitors to establish best practices for our industry."

The DV Committee's work mirrors what the cable industry did back in the early '80s to establish industry standards so agencies could compare apples to apples on a network by network basis. Since the Internet has thousands of video sites compared to the less than one hundred cable networks in the '80s, the task of the DV Committee is much more complex. One of the goals of the initial white paper was to eliminate industry confusion pertaining to online video. Key items were defined as follows,

Video advertising units:

• In-stream ad units (pre/mid/post roll, takeovers, overlays, bugs) -- generally played or viewed from a video player like a client browser.
• In-banner -- generally displayed in IAB Interactive Marketing Unit (IMU) standard sizes.
• In-text -- generally user-initiated and triggered by relevant highlighted words within content.

Online video content (three primary types):

• Premier Programming -- gives users professionally produced content, generally re-purposed from broadcast video and cable networks. There is a large amount of professionally produced video that has not been digitized but is quickly working its way online.
• Professionally-Generated Specialty Programming -- video content professionally produced but generally created for a specific subset of online video consumers. Consumers are searching for and consuming video content relevant to their micro interests -- whether it is original content for the Web or content from traditional media like local news or community events,
• User-Generated Video -- consists of clips created and uploaded by everyday people and make up the largest volume of videos available online. Generally, the majority of these clips are watched by a small group of users but due to viral word-of-mouth messaging some become extremely popular and are viewed by millions.

The Feb. 13 seminar centered on key industry challenges:

• ad format standards
• creative assets availability
• lack of standard data being reported to buyers
• audience scale needed to bring budgets of billions versus hundreds of millions into our space
• the need to make the medium's planning and buying process more efficient

In regards to establishing standards and best practices, which will give media buyers a solid footing when evaluating video advertising in the cross media landscape, the IAB has formed two working groups within the DV Committee: the Ad Format Standards Working Group and the Core Metrics Working Group. Specifically, the working groups aim to:

• define standards around video ad formats and best practices,
• create a public document defining all the metrics beyond impressions for online video advertising (e.g. midpoints, completes, etc),
• create a public document describing methods for third party ad serving into video players using lowest-common denominator XML.

The DV Committee, along with its working groups, will release their thoughts for industry adoption upon completion.

On the creative front, more 15-second and shorter ads are becoming available. The data on reporting click-through rates, ad playrates and interaction with the ads is already in place but needs to be standardized.

The various IAB committees will be reviewing findings with industry-wide stakeholders in one-to-one meetings and will be releasing a series of white papers on the standards that are being approved along with numerous case studies. The recent white paper and IAB workshop are just starting points for the powerful work that is making online video advertising a major marketing channel.

This commentary is insightful. I recommend it to others.