• by Jack Loechner , Staff Writer @mp_research, January 7, 2002

According to a Yankee Group report, printed in internet.com's Internet Advertising Report, Interactive television will gain a foothold in many American households as early as the end of 2002, although as a potentially new advertising milieu, the medium will have to wait.

Despite a fair amount of hype about interactive television advertising -- even during 2001's ad industry contraction -- use of the TV portal as sellable media remains distant, said Adi Kishore, an analyst with the Yankee Group's Media & Entertainment Strategies practice and author of the study.

"It's going to be difficult to gain significant revenue in the short run from this sort of service," he said. Advertising "is limited at this point ... there are hardly any subscribers to the service. Even when users adopt it, usage will be very 'bursty,' with consumers using TV portals to check weather, program guides ... Once they've got that information, they're going to go back to ... watching video content. It's not the ideal environment for advertising at this point."

Ultimately, Kishore did say he envisioned cable operators or iTV vendors also being able to sell sponsored ad space on TV portals. "For [banner-like advertising,] that's going to be a smaller element of the potential of this technology," he said. "As portals evolve and become the launch pad for a whole host of interactive services ... advertising will exist ... "

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