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Clip Culture Lacks Ad Revenue

Call it clip culture. The online video craze that's taking the Web by storm has trickled into the mainstream, causing advertisers to panic. Why? They're not involved. YouTube, for example, is attracting 20 million visitors per month, who spend an average of two and a half minutes viewing each video. That's bad news for YouTube, however, because it hasn't yet devised a way to make a living from its massive usage. If the viral video site (and its 240 followers) could attract ad dollars, online video would be the business to be involved in right now. But where and when do you place advertisements? One way, says Bambi Francisco of MarketWatch, is to place a 5-second post roll ad on each of the 100 million video clips viewed each day. YouTube CEO and founder Chad Hurley says that would be too easy; apparently, the company would rather be innovative than make money. Google, he points out, created advertising that helped the user experience--and he intends to do the same with YouTube. Michael Robertson, the founder of, says it's inevitable there will be ads on YouTube. Francisco predicts that placements will be auctioned off, like sponsored links on Google and Yahoo. Another option for YouTube is to sell sponsorships of its video categories. There are 40 user-generated channels on YouTube--one wonders why it doesn't sell sponsorships on all of them.



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