Commentary

FreeWheel's Q3 Report Shows Big Uptick In OTT, Smartphone Video Ad Views

FreeWheel’s Q3 Monetization report is out, and while I suppose it is full of good news about the maturation of the streaming video business, the context is that online video is becoming a lot more like TV.

Oh, that again.

Early on in the new FreeWheel study, it notes: “The advertising landscape for digital video continues to converge with that of linear TV.” Ad views within "long-form" videos (20 minutes or more) are up 41% year-to-year. And,  “mid-roll” commercial breaks on long-form content (like network dramas, for example) averaged 101 seconds, and comprised four ads, on average

A year ago in the same quarter, that was 87 seconds and 3.5 ads.

But skip back just a little more. In Q2 (not Q3) of 2013, that mid-roll break was just 68 seconds and included 2.7 ads.

Maybe it’s just me, but mid-roll ads is another way of saying advertising-every-15-minutes which is one of the great turn-offs about conventional TV, so fully absorbed into our media blood that it barely gets mentioned. But “The following program is brought to you with limited commercial interruptions” is really just another way of saying, “We know everything else you see is cut into annoying little pieces that you can’t stand.” Et tu, online?

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Still, online is the new TV, that’s true, and as it does every quarter, the FreeWheel report tends to note some cool trends and massages them in interesting ways. There’s a lot more in it--about TVEverywhere, live viewing and more.

Its theme these days includes as much about where people are viewing as what they’re viewing.

So look at this:  As FreeWheel follows the money, the Q3 report notes 27% of video monetization came from smartphones (14%), tablets (7%) and over-the-top devices (6%).  

But a year ago, just 8% of ads viewed came from smartphones. And OTT was nothing — ”little more than a glimmer in the eyes of publishers” that was responsible for just 2% of the ad revenue.

FreeWheel concludes: “The growth of OTT devices marks a new trend in consumer behavior as shoppers purchase economically-priced devices with the sole purpose of watching digital video.”

And maybe, that’s the phrase to pay attention to —”with the sole purpose of watching digital video.” Of course, FreeWheel is in the ad business, and it’s owned by Comcast, so online video-as-TV comes with a built-in advertising assumption, as if the sole purpose of watching, to an ad person, is to be sold something.

This report takes a pretty jolly view toward how this transformation is faring. “While traditional TV Publishers may have a reputation for being risk-averse, we continue to observe experimentation and testing in the quest for digital video’s ‘Holy Grail’; the optimal ad experience,” the report says.  

And when they master that perfect ad experience, everything will change, right?

Well, maybe not.

“As publishers continue to tinker,” this report says, “we expect to see the digital experience on premium content come even more closely in line with what viewers are accustomed to on linear TV.”

I guess that’s what I’m afraid of.  

I’m hoping for something more. As OTT develops it will be interesting to see how content providers, OTT device marketers and advertisers re-configure their strategies. If people are paying for Roku, Apple, Amazon or Chromecast, and also being served advertising every 15 minutes, then streaming video will seem much less interesting, and much more like...TV.

And that was the point of all this?


pj@mediapost.com
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