The Chart: Reality check on online video
Reality check on online video — In an interview with Doubleclick's chief executive, in today's Wall Street Journal, there's some interesting data. David Rosenblatt, in the process of selling the online advertising broker to Google …
Context & Ripple Effects
The timing of David Rosenblatt's reality check matters. Weeks earlier, DoubleClick was itself the source of video-ad optimism, arguing in March that video ads were leaving static GIFs and JPGs behind — and by late March the broker had put itself on the block, with the Wall Street Journal reporting it was exploring a sale before Google moved to buy it.
So when Rosenblatt hands the same newspaper a dose of sobriety about online video while that sale is pending, Valleywag reads it two ways at once: a broker with unique visibility into advertiser demand cooling the hype, and a seller whose buyers' ambitions depend on how big this market really is.
First-order effects
- Advertisers and agencies using DoubleClick's numbers to size video budgets now get a deflating data point from the very intermediary they would buy through — and one whose independence is about to end under Google ownership.
Second-order effects
- Rival ad servers and video networks have to answer the same measurement question with their own data, since the dominant broker's read on video inventory will anchor pricing across the display market once the deal closes.
Third-order effects
- If the pattern holds, online video advertising consolidates around whoever owns the serving-and-measurement layer rather than whoever owns the content, making independent brokers an acquisition target class rather than standalone businesses.
The trend: Online video advertising is entering its metrics-discipline phase, where intermediaries' data — not publisher enthusiasm — sets the size of the market.