Overheard: Word of the Day

Aug 12 2008   5:51AM GMT

Overheard: Monetizing web video with product placement

Margaret Rouse Margaret Rouse Profile: Margaret Rouse

frank_rose.jpg Sure, the YouTube explosion was fueled by amateurs, but it will be showbiz professionals who cash in on Web video. That’s because most big corporate advertisers want a safe, predictable environment — not the latest YouTube one-off, no matter how viral.

Frank Rose, Hollywood Has Finally Figured Out How to Make Web Video Pay

Frank Rose put together an interesting look at the scramble to monetize web video. I hadn’t realized that some TV execs were looking at Web video as the farm team for the big league. It also hadn’t occurred to me that product placement in web video could be big business.

On a sunny afternoon in March, Rogow pulls his black Porsche SUV to the curb, collects a ticket from the valet, and walks briskly into the Creative Artists Agency building on LA’s Avenue of the Stars. Perfectly framed in an enormous glass wall is the Hollywood sign, 8 miles away. Rogow is here to meet with Anita Lawhon, the Cisco executive in charge of entertainment partnerships. This is crunch time for Gemini Division, the weeks when everything — advertising, distribution, financing, production — must come together. On a table in the vast marble reception zone sits this morning’s Daily Variety. “Changes to Biz Give Town the Jitters,” reads the front-page headline.

Today, Rogow is focused on how to get that business model working. It’s going well — so well that Herskovitz recently met with his CAA agents to learn how Electric Farm is doing it. Cisco is key. Those Gemini Division agents are going to wield some pretty cool tech, much of it — thanks to a deal brokered by CAA — actual products from Cisco: a video surveillance system that sends an alert when someone penetrates the wrong sector; digital billboards that can be reprogrammed on the fly; TelePresence, a teleconferencing system with life-size video so hi-def it makes virtual meetings seem almost real. In the past few weeks, similar deals have been cut with Acura, Intel, Microsoft, and UPS. “In a cold business sense,” Rogow confides, “this show is a self-financing marketing vehicle.”

Another quote from this article got me thinking: “In 1908, movies were 10 minutes long because that’s all you could get on a reel of film, and the actors who appeared in them were anonymous. ” Sound familiar?

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