YouTube gives in to mandatory ads

A man searches for videos on the YouTube Web site.

Jeremy Hobson: Television advertising in the United states is a $60 billion a year industry. Ad spending for online videos is just a tiny fraction of that. But this week Youtube is ramping up its efforts to change the landscape.

Marketplace's Steve Henn reports.


Steve Henn: YouTube has built enormous audience, serving up prank videos, animal bloopers and laughing babies.

Kate Rose: We are up to about 50 million impressions in the United States on the homepage.

And...

Rose: That's everyday.

Kate Rose is a spokesperson for YouTube.

Despite these big numbers, YouTube's ad sales are not so hot. Dave Hallerman is an analyst at eMarketer. He says big national brands don't want their ads running before a video of drunk teens dancing or babies barfing.

Dave Hallerman: Actually, it's been almost embarrassing how few advertisers YouTube has gotten.

So YouTube created an ad plan called First Watch. It lets advertisers place the same add on a bundle of different videos. No barfing babies or teens in the mix. Taken together, the videos could add up to a pretty big audience. How big? Think a commercial on "Glee."

In Silicon Valley, I'm Steve Henn for Marketplace.

About the author

Steve Henn was Marketplace’s technology and innovation reporter for the entire portfolio of Marketplace programs until December 2011.

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