Tiger Woods has been in the news for a good portion of the past week’s news cycle. Modern Warfare 2 has been dubbed as the biggest success in entertainment across games, movies, and television. The Superbowl tickets are in the thousands of dollars.
What do the above facts have in common? They’re big events, extremely profitable and for the most part, have tremendous global recognition.
Another common factor is that they are all traditional media properties.
And, there in lies the biggest problem of online video. Online video, till date, has not proven to be big enough. Annual revenues attached to online-only media (audio/video) properties are smaller than most departmental budgets at traditional media companies.
Producing original online audio/video content is expensive and profit margins are extremely low. While one can blame multiple factors for lack of revenue, it can often be explained by one thing — reach.
Even the most profitable and popular shows reach a few hundred thousand viewers. While this is a huge accomplishment in the online world, the online video community has to work together to deliver a product that is beneficial for the audience and for advertisers. Most advertisers I’ve spoken with are unsatisfied by the results delivered by expensive show sponsorships. While there are some that are satisfied, they represent a small minority.
However, that is not to say that online video has failed to deliver an impact. Far from it. Traditional media entities, which already produce content, have embraced the web in numerous ways. A few years ago, watching primetime content on the web was a challenge. Today, there are multiple outlets for watching the same content — legally.
All portable devices today include video functionality, a feature which was not a priority a few years ago. Online video has left a big impact. But, in today’s day and age, reaching 200,000 people a month is not enough. Popular blogs reach that audience more effectively.
In order for independently produced online video to succeed, it has to be bigger. Much bigger.
