Blog Post

Online Newspapers Are Attracting More Local Ad Dollars With Streaming Video

All forms of traditional media realize that survival depends on offering quality streaming video in order to retain and attract advertisers. Oddly enough, in the race to grab those ad dollars, newspaper websites are beating their broadcast TV counterparts, according to a new study from local media consultant Borrell Associates. Newspaper websites captured $81 million in locally spent streaming-video advertising, while local TV sites collected $32 million in ad spend last year. As E&P noted in their take on the report, this is a particularly small market, with the total ad dollars amounting to $161 million in 2006, although it’s a growing form of advertising. The Portsmouth, VA,-based consultancy projects that in five years, local online video advertising will exceed $5 billion, roughly one-third of all local online ads. Borrell estimates that within that same time span, 75 percent of all local placements on the web will be in the form of paid search or video advertising.
Despite the advantage of having a trove of rich video content, TV stations have not kept up with newspapers in sharply focusing on commercial content. Newspapers have been aggressively trying to make up the fall-off in print ads with online classifieds. One of the most effect ways of attracting advertisers has been by selling video supplements, the report said. Borrell also noted that of the roughly 1,450 daily papers in the U.S., about 40 percent are equipped with some form of video player on their websites.
On the other side, many broadcast TV sites have looked outside themselves for streaming video material to feed their web pages. A great number have signed up with the Associated Press’ video program, though few are selling ads around the content. AP though has partnered with MSN to sell 15-second pre-roll commercials across its member sites. In terms of the most dominant ad categories looking to local online video, Borrell pointed to real estate and automotive. A summary of the Borrell report can be viewed here.
Staci adds: Network and affiliate agreements are starting to change the broadband video game for local TV stations. ABC’s Anne Sweeney emphasized last week at Disney’s investors meeting that the network’s broadband player will add geo-targeted news and local avails. The Fox-owned stations have implemented broadband players for local and national programming and I think will soon extend that to affiliates. Other networks are making similar arrangements.