FT.com / Companies / Media & internet – Online ads ‘shun user-generated video’

User-generated video sites such as YouTube and MySpace will earn only a fraction of the advertising budgets available for more professional online programming, according to a study.

Such sites’ advertising revenues stand to grow from $200m last year to $875m by 2010, but this will account for just 15 per cent of the total online video advertising budget, according to Screen Digest, the media analysis company.

The report echoes News Corp’s admission that its Fox movie studio
and television content will be more important than home-made clips for
capturing online video advertising, a market which Screen Digest
expects to expand from $1.1bn last year to $6.2bn by 2010.

Peter
Chernin, News Corp president said at a recent conference: “We do not
see big advertisers advertising with YouTube or MySpace. They have
concerns about the content … and there is no scarcity value for the
content … so there is very little ability to monetise video
advertising on user-generated video.”