May11

Written by:Scott Rakestraw
5/11/2006 10:32 PM

VOD Research:

• 70% of advertisers believe that digital video recorders (DVRs) and video-on-demand (VOD) will reduce or destroy the effectiveness of traditional 30-second commercials.
• 78% of advertisers said television advertising has become less effective over the past two years.
• When DVR usage reaches 30 million households in the U.S., expected within three years, almost 60% of advertisers will spend less on conventional TV advertising; of those, 24% will cut their TV budgets by at least 25%.
• 80% of advertisers will spend more on Web advertising, and 68% will use search engine marketing.
• Advertisers are also looking at alternatives to traditional TV advertising and will spend more of their ad budgets on branded entertainment within TV programs (61%), TV program sponsorships (55%), interactive advertising during TV programs (48%), online video ads (45%) and product placement (44%).
• Visa USA has taken an aggressive stance in exploring alternative TV and emerging media ad formats by experimenting with TiVo, VOD, wireless phone and PDA advertising.
  23.9 million households with video-on-demand capability at the end of 2005; An increase of 27 percent from 2004.
• By 2010, virtually all of the 46.9 million digital cable homes will have video-on-demand capability.
• Comcast, which has been particularly aggressive, reported $100 million in ad revenue from VOD service last year, more than five times what it made in 2004.
  "If you ask consumers whether they would rather have video for free with ads or pay for a show and see it commercial free, they choose the advertising," - Brad Adgate, corporate research director for Horizon Media.

Source: Association of National Advertisers and Forrester Research (b2bonline.com 4/2006)

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