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Summary:

[qi:032] YouTube last night said it’s offering a new kind of embedded in-video advertising that’s going to help its parent company, Google (GOOG), and its media partners make money off what has thus far been a fallow field — online video. YouTube’s in-video advertising techniques have […]

[qi:032] YouTube last night said it’s offering a new kind of embedded in-video advertising that’s going to help its parent company, Google (GOOG), and its media partners make money off what has thus far been a fallow field — online video.

YouTube’s in-video advertising techniques have resulted in many pointing out that VideoEgg, a San Francisco-based startup that goes through identity changes more often The Talented Mr. Ripley has already offered these kinds of ads. (It’s a Facebook-ad network now!)

VideoEgg is “welcoming” YouTube to the party, pointing out that Google’s YouTube is imitating them. That’s nothing new, however. The text-links-as-ads were someone else’s idea, too, but Google ended up making billions off of it. Nevertheless, it is interesting to point out that the source of inspiration for the in-video ads of both VideoEgg and YouTube is actually a business they are both trying to take to the cleaners: broadcast and cable television.

If you watch baseball games on Fox or some of the cable networks like TBS, they use a technique (known as “snipes” in broadcast lingo) in which a promotional ad is overlaid on top of the regular broadcast stream. GE Co. (GE), parent of NBC, has a patent (United States Patent 20070143786) that talks about advertising based on this methodology.

A technique is provided for advertising. The technique includes a combining of two or more video streams to form a unified video stream and broadcasting the unified video stream. At least one of the two or more video streams is a program content stream comprising program content that is filmed by a camera and at least one of the two or more video streams is an advertisement material stream comprising advertisement material.

Does this patent apply to Internet video? I am not sure, but if it does – oh boy, have we got trouble. Wired News’ Epicenter blog also points to patents filed by VideoEgg. Interestingly, this whole issue might end up becoming a patent nightmare.

By Om Malik

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  1. Interesting… I also read that the links were about 80% transparent, and they show up in the bottom 20% of the video (from mashable).

    As long as they don’t take away one’s experience from watching a video, it’s all good. (Doubt that will happen, as ads are supposed to take away one’s experience).

    “If you watch baseball games on Fox or some of the cable networks like TBS, they use a technique (known as “snipes” in broadcast lingo) in which a promotional ad is overlaid on top of the regular broadcast stream.” – Mr. Malik.

    Yeah, when watching futbol (soccer), sometimes a huge soccer ball swings in the middle of the screen, and it shows an ad at the bottom. Kind of annoying, in my opinion.

    Anyways, we’ll see how this goes…

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  2. Google settled with Yahoo! over violations of patent 6,269,361 (text link ads) and issued Class A stock in 2004. Yahoo! cashed out its share (from GoTo/Overture) shortly after the GOOG IPO for hundreds of millions of dollars.

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  3. [...] where does that leave us? Maybe none of these startups did – Om says it all goes back to old school television. We’ll see if VideoEgg’s patent filing is [...]

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  4. Well put

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  5. The concept is hardly new though by definition execution technologies on broadband PC Web TV will be recent…but whats interesting is the only reason there is all this hoo-ha is because this is the format YouTube has gone with for Ads.

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  6. GE … has a patent

    No, GE has applied for a patent. Even if the patent is eventually granted, the surviving claim language may not preclude the specific claims made by VideoEgg. (Hard to tell since it appears the latter hasn’t yet been published.)

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  7. Hi Om! If memory serves me, networks like TBS and TNT started putting these types of ads at the bottom of their shows as a way to stop people who were taping movies (mostly), cutting out the regular commercials, and re-selling them. At the time, Turner was just starting to produce original films for its networks, as well as having made some very good deals for showing stuff like Star Wars and ET, and was very concerned about affecting piracy as much as it could.

    Curious how things have changed.

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  8. [...] the whole issue from Wired Epicenter, to NewTeeVee, and to round it out, CNet, Computer World, GigaOM, Techcrunch, Techdirt, and everyone else on the bandwagon. Heck even we mentioned it yesterday [...]

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  9. [...] interested in knowing the true origin of overlay ads, the Om in GigaOM has two words for you: broadcast television.) The only benefit to the dispute for us sideliners is to see geeks fight, and personally, that [...]

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  10. youre a patent nightmare….wait, what? google made a genius move buying youtube back in the day. doesnt google have a team of researchers and lawyers to figure this stuff out before they take any action?

    http://www.drunkenpanda.com

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  11. When everyone calms down, I think the players who currently sell online video overlays (VideoEgg included) will genuinely welcome Google/Youtube’s entry into the space, and adoption of the format. They are the only players who have the scale and the relationships to turn it into a standard, which is good for everyone who sells the unit, whether VideoEgg, Brightroll or Youtube. Hence I don’t think we’ll see any patent lawsuits

    More at the Lightspeed blog at:

    http://lsvp.wordpress.com/2007/08/23/youtubes-entry-into-online-video-overlay-will-be-good-for-its-competitors/

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  12. [...] the hullabaloo centered on VideoEgg’s claim it had “invented the video overlay.” (Survey says: [...]

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  13. [...] may have thought of it first, even if it seems largely inspired by TV "snipes" (thanks to Om Malik for updating my terminology). Video Egg is getting some collateral publicity, though, so not all is [...]

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  14. jeremyliew <– you are exactly right, VideoEgg’s satirical ad placed on their home page has enabled them to gain a mention in what should have been one of Google’s biggest announcements this year.

    The bottom line, for VideoEgg and the other Start-ups using overlays, is that this move equals validation for the ad format.

    It also seems that much of the noise made about VideoEgg’s statement has been blown out of proportion. VideoEgg is not a primarily a destination site and therefore not a competitor to YouTube (notice they are often referred to as “rivals”).

    VideoEgg partners with social networks to deliver their ads. So lets see what they really got out of their satircal ad: a ton of stolen publicity…period.

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  15. It would be nice if a serious journalist on this subject actually addressed the bigger story of ‘who is going to make all these new ads?’

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  16. The idea of clickable overlaid links in video goes back to the 1980s – see Douglas Adams explain about Hans-Peter Brondmo’s micons

    http://epeus.blogspot.com/2007/08/actually-in-video-linked-ads-date-back.html

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  17. Hmmm…Just brings up why I don’t like patents.

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  18. [...] VideoEgg SNIPES At YouTube: Who Thunk It First? Maybe Old TV Guys [qi:032] YouTube last night said it’s offering a new kind of embedded in-video advertising that’s going to help its […] [...]

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  19. [...] conclusion, and if we don’t count possible future patent nightmares, it doesn’t matter who invented overlay ads. Text link ads weren’t Google’s idea, but who ended up making billions with [...]

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  20. [...] というわけで、結論としてはどうだろう?おそらく、これらのスタートアップ企業はいずれもオーバーレイ広告の発明はしておらず、全ては昔ながらのテレビによるものだ、とOmは言う。VideoEggの特許申請が独自のものであると認められるかどうかは、これから分かることになるだろう。しかし、VideoEggはすでに、他社による類似サービスを積極的に阻止するために特許を利用することは無いと言っている。市場がすべてをふるいにかけるだろう。 [...]

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