• by Erik Sass  @eriksass1, February 28, 2007

Although online video isn't yet a profit center for many magazine publishers, it should achieve profitability in the near future, according to a panel of magazine executives discussing online video at "Magazines 24/7," a conference hosted by the Magazine Publishers of America in Manhattan on Tuesday. One key was closing the gap between online video ad rates and those of traditional TV.

Paul Maidment, the editor of Forbes.com and executive editor of Forbes magazine, noted that Forbes.com's video streams reach more daily viewers than CNBC's traditional TV ops. But "they still get ad revenue in multiples, and multiples of multiples" of what Forbes receives, Maidment said. Even if online video doesn't achieve parity with traditional TV, the disparity suggests there is "a big pot of money out there" for magazines delivering online video.

In the short term, magazines will continue delivering and expanding their online video content even if it isn't a big profit center, said Todd Unger, senior vice president of Time4 Digital, recently acquired by Bonnier. "If we don't provide it," he added, "there are people in these verticals" that will. Likewise, Ann Shoket, editor in chief of Seventeen magazine, warned: "If you don't have video, you can't have viewers. It's as simple as that."

Asked what form effective video advertising will finally take, Maidment conceded, "no one has yet found a workable advertising model. At the moment, we're mimicking TV." However, this is already changing, he noted, predicting that ads will "get shorter and shorter ... you're now seeing pre-rolls getting down to three seconds. You'll see more things heading that way."