It’s definitely fun and exciting to be part of an announcement that has the potential to modify or perhaps – OK, let’s be pompous about it - alter an entire industry: the generations-old television content distribution and advertising business. That’s where YuMe are today as we’re announcing a deal to provide ad management services to the new online NBC Direct service.

It’s no secret that the Internet has sent some shock waves through Hollywood and Madison Avenue as tried-and-true advertising models have been threatened by the arrival of online video. But this deal – which allows consumers to watch premium prime time content free via the Internet – reinforces the idea that that decades-old approach of offering free content in exchange for watching ads is not dead. Far from it.

Consider Deloitte Services LLP’s annual media consumption survey, which found that 31 percent of respondents said they are influenced by pre-roll video ads while more than 60 percent said they were generally willing to see more online ads if they could get valuable free content. At the same time, comScore, a leading tracker of online traffic, released its December figures, noting that ads served by YuMe are reaching 46.9 million unique visitors per month – not too far behind YouTube, which reaches 56.6 million.

From an advertising perspective, there’s no comparison between viewers of YuMe-served ads on NBC Direct and YouTube clips. Google-owned YouTube is doing what it can to break its reputation of being home to the video clips of amateur and sometimes sophomoric antics. On the other hand, NBC Direct is offering professional premium content – hit shows such as “Friday Night Lights,” “The Office” and “The Tonight Show with Jay Leno.” You won’t find any pet acrobatics or skateboarding wipeouts there. But what you will find are viewers who are loyal, engaged in the content and obviously tech-savvy – after all, they’re watching online, on their phones, on their handheld media players and even on their WiFi-connected HDTV sets. Seems to me that this is exactly the type of audience that NBC advertisers want to reach.

Combine that with the in-depth data that YuMe can provide – such as real metrics on viewership and ad performance in downloaded, as well as streaming, playback – and you’ve got the beginnings of a formula that could finally give the television networks the type of online monetization option they need to adapt to their changing industry.

Is our approach a strong, viable option for networks that are trying to develop a monetization plan for this new form of distribution? Of course, we think so. But we’re also not saying it’s the end-all method, declaring victory over other models. This is all new and it’s going to take time to figure out what works. Viewers, who have more options than ever before, are calling the shots these days. They will make or break the models.

Believe me, I sleep better at night when I hear that a large majority of consumers say they’d be willing to watch more ads in exchange for valuable free content, that’s something you can’t ignore. We hope to keep rocking the boat with more of these types of announcements in the coming months. As they say in TV, “Stay Tuned.”

Jayant Kadambi

The biggest technology show of the year, the Consumer Electronics Show in Las Vegas, is just about over. If you’ve never been, it can be an overwhelming experience. Companies go all out to show-up one another on the show floor with their massive booths and enormous video displays.

YuMe did not have a booth at CES but I was there to speak on a couple of panels about online video and the changes that it’s bringing to the online advertising space.

On the show floors, companies such as Microsoft and Hewlett Packard used large video screens to showcase their products and services, new technologies that are giving the consumer control over the types of content they want, such as their networked personal library of videos, photos, and music. They’re also showcasing the growing number of video choices available on the Web, from network television shows to feature-length movies.

On Monday, I spoke on a panel called, “Advertising in P2P, Search, Social Media and other Web-Based Services,” sitting alongside others who are also seeing changes in this space.

It was an interesting session and, if nothing else, it just goes to show that this concept of alternative advertising is in its infancy. The alternative ways to get a message across – things such as Facebook “gifts” – are starting to grow and advertisers seem to be receptive to exploring new ways.

One of the things that allows YuMe to stand out in a crowd is its tools for tracking an ad. Advertisers need to know what happens to their ads online, things such as when they were watched and where they were watched – over a peer to peer network, via a social networking site, even over a mobile phone.

Increasingly, advertisers are being presented with new opportunities to put their messages in front of the right audience. As this space continues to evolve, YuMe is committed to help connect advertisers with content providers to give both what they need to move forward.

Jayant Kadambi

It is interesting being in an industry where you can wander the office talking about Jackass and not get the HR hounds frothing.  Since we at YuMe were bidding on part of the Jackass advertising campaign, it was free game, at least for a while.  And then, on the 19th of December, which strangely enough is a Wednesday, the sequel to Jackass 2 (or perhaps a massive PR campaign for Jackass 3) debuted.  And it debuted online.  Sure, the distribution rules are highly complex, it plays only until the 31st of December 2007 exclusively on http://blockbuster.jackassworld.com/, and then it plays on Joost, can be downloaded from iTunes, available on Amazon, and then in February, the satellite and VoD providers will air the movie.  I guess technically Jackass 2.5 is not a movie, since it’s only an hour, but the interesting thing is that they are streaming pre-roll and post-roll ads during the playback.  Now, I haven’t watched the whole thing to see if there are ads during it, but it does seem that this release of content is truly ad supported to start. 

Content owners continue to overcomplicate the distribution life of content so they can extract what they think is the maximum value from a piece of content.  Actually, my pet theory is that the distribution rules for content are clearly designed to be highly complex and require tons of lawyers as a BD and legal employment preservation act.  But, that being said, this is good stuff, and maybe a worthwhile trend is starting.  On December 10th, Warner simultaneously introduced the popular Robert Ludlum movie franchise’s latest movie blockbuster, The Bourne Ultimatum, simultaneously on Vudu and DVD.    Vudu is a service/set-top that allows people to watch high-quality, presumably theatrical movie stuff in their homes.

The fact that content owners are beginning to add broadband and online distribution strategies to their precious content monetisation is good.  Hopefully, they will learn to overcome their fear of new distribution models and that the more people that have access to good content, and the earlier they have access to it, the more people will watch.  And the more they watch, the more money they’ll earn.  They just need smart advertising to help monetisation.  Charging a Queen’s (OK, perhaps a Prince’s ransom) on a subscription or pay-per-use basis isn’t going to bring accretive revenue.   They’ll need to advertise.  And let’s stop with the human cry over advertising on theatrical content.    What is it that you watch for 8 minutes before a DVD that you purchased?  Those 3 trailers are adverts.  Wouldn’t it be great to be able to get relevant ads when you watch that 3-year-old Jason Bourne movie, rather than an ad for the next one?

Jayant Kadambi