Media

AOL Adopting TV Model for Online Video Ads (AOL, GOOG, YHOO, MSFT, CMCSA, NWS, DIS, TWX)

AOL Inc. (NYSE: AOL) will soon make advertisers an offer it hopes they can’t refuse. The company will give advertisers the opportunity to buy online advertising using the same model currently used to buy TV ads. In conjunction with Nielsen, AOL plans to offer audience guarantees based on gross-rating points. The advertiser is guaranteed that the ad will be viewed a certain number of times by the specific demographic the advertiser is seeking to reach.

And AOL may be just the first online site to move in this direction. The Wall Street Journal reports that AOL, Google Inc. (NASDAQ: GOOG), Yahoo! Inc. (NASDAQ: YHOO), Microsoft Corp. (NASDAQ: MSFT), and Hulu LLC, a joint venture of Comcast Corp. (NASDAQ: CMCSA), News Corp. (NASDAQ: NWS), Walt Disney Co. (NYSE: DIS), and Time Warner Inc. (NYSE: TWX) will hold the online equivalent of the venerable TV upfront, where networks try to persuade advertisers to spend ad dollars on the basis of future programming.

TV advertising totaled nearly $61 billion in 2011, while online video advertising totaled $2 billion, double 2010 ad revenues.

Paul Ausick

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