What GOVA’s Gavone Means to Online Video and the New Networks

There’s a new Global Online Video Association led by Paul Kontonis. What does it means to YouTube and the networks like Collective, Maker, Machinima, Fullscreen and others?

He’s the new GOVA Gavone. The leader of the online video association. The guy who’s scream silences a room.

AdWeek reports that Paul Kontonis, former online video producer and agency guy, is heading the new Global Online Video Association (GOVA). Kontonis has been a leader in the online video space from its inception, including such roles as founder of “For Your Imagination,” VP at Digitas’ Third Act, and chairman of International Academy of Web Television.

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Paul Kontonis is the gavone who heads GOVA, the new online-video trade association.

By day, Kontonis heads sales and strategy for one of the top “multichannel networks” (MCNs) called Collective Digital Studio. GOVA is made up of nine of the top MCNs (also called online-video studios and “new networks”). These include Collective, Maker Studios, Fullscreen, Big Frame, BroadbandTV, DECA, Discovery’s Revision3, Magnet Media and MiTu Networks. Machinima is conspicuously absent, but unlikely for long (it’s quite common for the biggest in an industry to initially think they don’t need an association).

GOVA represents 9 of the top 10 online-video studios, or MCNs
GOVA represents 9 of the top 10 online-video studios, or MCNs

Caveat: I know Kontonis and like him (which is why I am allowed to call him a gavone as a term of respect). He was even in one of my videos where I thought I turned invisible. But I haven’t spoken to him in a while and know nothing directly about his GOVA appointment. So this is all my speculation based on watching this space mature. And I wrote a book, so shut up.

What’s ahead, and what does GOVA mean to the networks and the maturing landscape of online video?

  • Susan Wojcicki, the leader of YouTube.
    Susan Wojcicki, leader of YouTube, is focused on mainstream players. GOVA may help keep her attention on smaller studios.

    Bargaining Power with YouTube. The online-video networks, or “multichannel networks,” will now have a collective voice they’ll need more in coming years. That’s in part because YouTube, the virtual monopoly on distribution, is increasingly turning its attention to more mainstream studios and traditional networks. As YouTube grows, it will be increasingly difficult for individual studios to command the attention they’ve received in the past. How do we know that? History is the best predictor: Initially top YouTube stars could garner attention from Google and resolve issues. But eventually YouTube creators needed the power of a network. The networks don’t know it yet, but in years ahead they’ll need strength in greater numbers than they have today.

  • Bumpy Road, Herding Cats. Associations can be tricky, as participants theoretically want a collective voice, but they’re also competing against each other for precious advertising dollars. Kontonis has shown he’s got the diplomacy and persuasion to herd these network cats.
  • GOVA may help keep emerging studios independent, which is good for "amateurs."
    GOVA may help keep emerging studios independent, which is good for “amateurs.”

    Could Slow Down Acquisitions. In the coming years, we’d expect to see more of these online-video networks get acquired by larger players. Discovery ate Revision3. Google ate Next New Networks.  GOVA may give some of these players more time to play independently, if they wish, before the eventual consolidation of traditional and “multichannel” networks in the 2015-2020 period.  That doesn’t mean the MCNs will be less attractive to acquiring parties, it just means they won’t be as desperate to be sold. That’s a very good thing for individual creators of these networks. (When they do get acquired, they’ll try to convince you it’s a good thing…  but as a loyal WVFF reader you’ll know better).

  • GOVA can help negotiate with emerging video-playing technologies
    GOVA can help negotiate with emerging video-playing technologies

    Developing Emerging Channels to Reduce Dependency on YouTube. As we look beyond YouTube, the major stakeholders are technology companies, advertisers, and content creators. Years ago, an individual studio could negotiate their video content onto new platforms — like we saw Revision3 do with Roku and College Humor do with TiVo. But that will be more difficult as stakes increase and traditional networks start seeing more meaningful “TV dollars” moving to emerging channels. This coordinated approach through GOVA will increase the studio’s voice with new platforms. Watch for GOVA serving a role to keep them “out in front” of new platforms — from Roku to Netflix and Hulu to Amazon. And more importantly, the emerging video distribution platforms we don’t yet see coming. Maybe one day even AppleTV!

  • Other Boring But Important Crap. GOVA can also help with legislation/regulation, advertising formats, metric standardization, growth of the online-video, and thought leadership. Depending on the issue, they will likely partner and challenge other players like IAB, ComScore, traditional media associations, and marketing agencies.
  • Four More Years. That’s how long I see this lasting. By 2018, we’d expect GOVA to roll into the Internet Advertising BureauIRTS or some other association. But no other association has the knowledge of or focus on this medium.
  • Bottom Line. Creators and studios need GOVA whether they know it or not. Otherwise the technology platforms and advertisers will set the agenda.
maker, deco, big frame, deca, magnet, fullscreen, collective, web, studios, networks, online, youtube
9 out of the top 10 “multichannel networks” are included in the new association.

Online-Video Ad Spend: Optimistic But Still “Sculpting Fog”

Don’t get depressed about the economy folks. Even wrecklessly stupid brands are squeezing old-media spending in favor of paid search, targeted interactive advertising, and … yes… even online video.

Marketing and advertising spend on online video has a good future. Even though it’s a small sliver of online spending and difficult to measure (slicing fog), Uncle Nalts has some ideas for the industry that can help. I’ve even numbered them below, but let’s look at the problem first.

Today’s eMarketer reports that LiveRail (LiveRail is a video ad server, so take this with a grain of salt) estimates 2010 at $1.4 billion, up from a 2008 spend of about $619 million. eMarketer is a bit more conservative (and recently downgraded its forecast), but may not be counting special programs… for instance, it’s hard to measure sponsorships that are unique to a creator or a website. Nonetheless, most agree that online-video represents just 2% of online spending, which is asburdly low. It reminds me of how slow media buyers were to capitalize on paid search in the early 2000s. I need to say that again. It reminds me of how slow media buyers were to capitalize on paid search in the early 2000s.

Daisy Whitney wrote a nice article summarizing the issues with measuring the online-video advertising. Uncle Nalts spoke to Whitney, but she had tossed her phone in the bathtub before he got his points across… Whitney reports that IAB (Interactive Advertising Bureau – see its blog) likes its methodolgy for capturing spending.  IAB measures “digital video commercials” or “TV-like advertisements” that appear before, during or after a variety of content, but not brand integration. “We believe we are capturing the biggest part of a growing market,” said David Doty, senior VP, thought leadership and marketing, at IAB.

Clients for whom Nalts has done promotional videos, or consultingI couldn’t disagree more. By IAB’s definition, I make zero income on online-video advertising. That’s because my YouTube Partner revenue is based on “InVideo” ads that presumably don’t meet IAB’s definition. And certainly the low income CPM-based “display creative” around my videos is not captured in that spend. But as grateful as I am about YouTube sharing advertising revenue, I make far more money through custom videos (aka sponsored videos).

What are sponsored videos? See this page for examples of entertaining videos that have subtle brand messages. My fellow creators do more subtle “product placement” for money, but I haven’t messed with that yet because I fear backlash if I’m not transparent. And I don’t want someone thinking I’m getting paid by Coke if I take a swig in a video. Even though I totally would if my friend Mike at Coke Interactive would throw be a friggin’ bone.

So what do we need to spur further uptake in online-video advertising?

  1. Measure it more precisely to help brands understand how to allocate their spend, and increase online-video advertising from 2% to something closer to 10%.
  2. Conduct more studies that show video advertising works — even if it’s surrounding (gasp) amateur or consumer-generated content.
  3. Encourage experimental marketers who are not only open to new channels, but pressure agencies to identify creative options so they’re not lost in the clutter.
  4. Reward agencies for exploring new vehicles to reach target consumers when they’re engaged in their experience (and not brain dead on the couch). The inventory is there, folks, but we’re not going to solve the problem by hiring stupid CPM media buyers that are recently graduated, hungover and trying to find a new boyfriend.

IAB online video metrics standardsThe Interactive Advertising Bureau (IAB) has now proclaimed metric standards in a PDF document available here. According to the report, “These definitions are part of a larger IAB effort to stimulate video industry growth by making the reporting of metrics for agencies and advertisers across multiple media partners more consistent”

Thanks to Mike Abundo of Inside Online Video for alerting me to important stuff like this that I might otherwise miss.

One Small Step for Video Ad Standards. One Giant Leap for Creators and Brands.

One of the factors that has limited the growth of online-video advertising is the production and traffic work. Mike Shields of Mediaweek reports that the Interactive Advertising Bureau this week introduced a set of guidelines to standartize online-video advertising and make the medium “easier for advertisers to buy.”

The new guidelines cover three basic forms of online video ad formats: linear ads — interruptive video spots which are typically of the pre-roll variety, non-linear ads — which include the increasingly popular ‘overlay’ ad units, and companion ads — bannerlike ads that appear alongside video as it plays on the Web.

The guidelines, writes Shields, are the product of work conducted by the IAB’s Digital Video Committee, which is composed of 145 leading media companies, including Google, Yahoo and Microsoft. “This is a historic day,” IAB president and CEO Randall Rothenberg said, likening the announcement to a similar set of landmark guidelines put in place for banner advertising in the late 1990s. IAB senior vp David Doty said he thinks leadership and marketing, predicted “seismic shifts” would occur in the online ad business as a result of their adoption.

So while the viewer in me isn’t too excited to see the new “interruptive video spots,” the creator and marketer in me looks forward to the possibility that this may unlock some of the potential of this medium.

In related news, tech writer Leah Messinger writes about other sites beyond YouTube that offer advertising models brands can consider.