EMarketer says online video viewing is outpacing ad spending

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New York—In an indication that online video is reaching mass-market penetration, eMarketer reported that more than half of the U.S. population (155.2 million people) will watch online video by next year.

According to the report, “Video Advertising Online: Spending and Audience,” this year will show the greatest growth in year-over-year spending on online video advertising, increasing by 89% over last year to $775 million.

Also, the growth rate for online video ad spending will remain near or above 40% through 2011, when video ad spending is projected to reach $4.3 billion. However, eMarketer reported, several factors prevent online video ad spending from keeping up with the growth in audience size.

“One is the uncertainty about what the audience will accept, with questions about where in the content the ad will run and how long it will run for,” said David Hallerman, a senior analyst and author of the report. “The other is the difficulty gathering together enough video ad inventory, with questions about ad placement and how to monetize the billions of user-generated video streams.”

—Kate Maddox

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