The exact form these ads will take continues to evolve, but the company for now is testing pre- and post-roll ads.
While YouTube's desire to make money is understandable, slapping on ads that users can't avoid doesn't seem like a good move. Ads that slow down content are intrinsically annoying; that's why so many people fast-forward through them. For now, companies boast that users can't fast-forward through streaming ads online, but it's inevitable that people will devise workarounds that enable them to skip Web ads.
Also, people are so used to viewing content on YouTube without ads, it's inevitable there will be a backlash when ads that interfere with the clips finally appear.
Of course, many ad execs are struggling with the question of how best to show video ads online. Jeremy Allaire, CEO of Internet TV company Brightcove, speaking this week at MediaPost's Outfront conference, proposed a new model of three-second pre-rolls and 10-second midroll ads.
This model, however, appears to have serious flaws. While a three-second pre-roll might be short enough that it won't slow down users too much, any sort of mid-roll ad sounds like the type of thing that will cause viewers to quickly click away.
Online ads that are proven to work well -- like Google's search ads -- do so in part because they don't interfere with users' activities. Yes, the ads are shown in prominent positions on the results' pages, but users who wish to ignore them can do so. The key is that users control whether or not to view the ad. What's needed is to extend that principle to online video ads, rather than trying to interrupt clips with TV-style commercials.