Will Mobile Rescue Online Video - Or Kill Advertising Altogether?

We’ve all seen “the slides": the ones where former Morgan Stanley analyst and current Kleiner Perkins venture capitalist Mary Meeker tells us that mobile is an oncoming train in the computer’s rearview mirror.  It’s true.  It’s happening. It’s a matter of time.

Apple Killed the Carrier Star

This development is partly thanks to Apple’s radical repainting of the landscape.  Before Apple’s iPhone emerged, carriers served as gatekeepers, and not being content-oriented, they created a very opaque environment.

Anyway, without a doubt, mobile is

1. what led Facebook to shell out $1 billion for Instagram;

2. driving Apple’s market cap past $600 billion; and

3. one of online video’s last chances to deliver on its promise.

By now, smartphones and tablets are becoming just another screen, a detail rather than a separate platform.  Even those who get caught up in the whole “mobile web vs. app” debate lose sight of the greater issue (in my humble opinion), which is that we will soon be spending a lot more time connected -- consuming content, engaging in commerce and fostering community – via mobile devices, which means on smaller screens (regardless of them being on the Internet or in an app).

This is a huge development for video producers, publishers and advertisers. 

Content

Video producers have spent the past five to 10 years fine-tuning their modus operandi, but the reality is that user behaviors and viewer preferences over the next five years may be radically different than what we have seen in the recent past. 

The repercussions won’t be limited to aesthetics, though that will be the start, for sure.  For example:

-        Text overlays (in the lower third) and graphics are important, but might be unreadable on a mobile device.

-        Talking-head stuff will be as boring on mobile as it is on a computer.

-        Visually rich b-roll and video will become more important than ever.

Without a doubt, some will lean toward empowering users to film, edit and publish on the fly. This probably fine; I don’t think more user-generated content, edited and uploaded faster, is what is hurting the industry.

Distribution

The more things change, the more they stay the same: YouTube’s iPhone presence early on only strengthened its stranglehold on online video.  Back in 2010, YouTube mobile was serving 100 million videos per day (care to guess what the number is today?)

In fact, according to Allot Communications’ MobileTrends Report, “YouTube remains the single most popular mobile internet destination, accounting for 22% of mobile data bandwidth usage and 52% of total video streaming.” 

It is true that apps have disrupted the Internet paradigm, but with apps now competing for attention in a cluttered App store landscape, the internet may ironically present a greater marketing opportunity than apps after all.

Monetization

Despite YouTube’s mastery of online video, each week, it’s only monetizing 3 billion views even though it serves 28 billion views (or 10%).  This is alarming considering that YouTube is growing at its competitors’ expense

This might explain why the industry at large has developed such bad habits:

-        The bulk of video advertising has come via inbanner placement, meaning that it has yielded sub-optimal results for advertisers, making them reluctant to spend more online.

-        Somewhere along the way, marketers and publishers mistook interactive advertising for annoying advertising.  That works on a large computer screen where the advertising can coexist with the content, but in mobile, you’re under a one-strike-you’re-out reality.

-        Pre-rolls are intrusive and nowhere near as complementary to the core organic offering (the video content, in this case) as paid search results are.

Scarcity Brings Clarity

Considering that the small screen will force all stakeholders to do more with less, it’s possible that ads will have to get their act together.  However, it’s also possible that mobile will kill advertising, because there’s simply not enough room for it.  The only time I’ve “engaged” with a mobile ad is when my fingers accidentally click on one.  After all, even Facebook has yet to pursue advertising in its mobile offering, and the notion that it bought Instagram to insert ads in it is laughable.

Maybe this is the irony for content creators: that after years of content being undervalued and production capabilities downright unvalued, maybe the only messaging that will matter in the fastest medium ever is content (don’t hold your breath, though).

Tags: video
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2 comments about "Will Mobile Rescue Online Video - Or Kill Advertising Altogether?".
  1. Patrick Fitzgerald from Poptent , April 16, 2012 at 4:09 p.m.
    The mobile plaform, and digital in general, will deliver on their promise when they are askd to promise the right things. When the platform delivers to its capabilities, it will change advertising as we know it. From content and creative right through distribution. Mobile offers brands the chance to engage consumers one to one on personal devices. The platform is made for interaction and the primary use of the device is interaction. Methods that do not fully leverage this reality are a waste of bandwidth. The screens are smaller and the customer is paying for bandwidth; consumers will not suffer interuption or intrusion. You better be relevant. If you are, you can connect content with conversion and in many cases transactions. This is a foundational change; it will require new methods and models. Advertisers will need access to creative resources with new operating models that are efficient and intentional. UGC does not fit into strategic plans. The more damaging blow may be to distribution models. Messaging methods need to account for the on demand ethos of the digital consumer. Digital has been waiting for the sea change to come about, it is here.
  2. Gordon Vasquez from RealTVfilms.com , April 16, 2012 at 6:35 p.m.
    The old saying "Content is King" - does that ring a bell? Gordon Vasquez CEO RealTVfilms.com