There is much controversy today about viable advertising models of any kind for the Internet. Advertising revenues that can be directly attributed to video streaming from any source on the Internet are virtually nonexistent. Being an advertising driven industry, it is not surprising that while most broadcasters have excellent websites, few have deployed video streaming as part of their Web strategy. Given a strong revenue stream, few seem compelled to venture out into the streaming world.
Some of the most popular websites focus on sports, weather and news, with data showing that almost 100 million viewers in a single month visited websites focusing on those topics. This is precisely the content best created and kept current by broadcasters. And the most compelling way to enhance the viewing experience is to deliver broadcast quality video to those web viewers. Today's snail-paced 56K modem connections are not up to the task of broadcast quality video streaming. However, the rapid deployment of broadband connections (DSL and cable modem) will make this a common experience for most dedicated Internet users over the next two to five years.
Why make a streaming investment now? As broadcasters know, changing the viewing habits of an audience is an expensive task once patterns are established. Just look at the cost of gaining share in any local market against the reigning news leader. Internet "viewing habits" are being established right now. Building brand awareness and loyalty now is relatively cheap compared to what it will cost once broadcast quality video streaming is common place. Broadcasters need to stake their claim on the new content delivery channels available on the Web AND add their unique brand identities. Broadcasters' brands are dependent on delivering high-quality, video-based content. Streaming is an imperative if your brand is to survive the coming deployment of broadcast-quality video over the Web.
The next few years will see a period of experimentation and rapid shifts of momentum as new kinds of models are deployed. Fortunately the costs of streaming are a very small fraction of the cost of a DTV transmission system, so early adoption of video streaming comes with a small relative investment. The more focused an audience, the better chance of attracting ads. Local broadcasters may have the big advantage as streaming takes hold and they do what they do best: match local viewers to local suppliers. Packaging ad messages (and ad rates) that run on TV and are enhanced by the Web video message which links viewers easily to the advertiser's website for further information seems to be a natural extension of current business models. Helping advertisers build video-enabled sites is another service broadcasters offer to their ad agencies and their clients.
Building experience, audience loyalty, advertiser awareness and improving a broadcaster's brand all add up to streaming now and not later. Those who carefully select their streaming initiatives now will be rewarded with stronger businesses in the years ahead.