Online Video Advertising is Best Performer in FH '10, Up 31% to $627 Million

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  Online video advertising is the fastest-growing ad category on the Internet, up 31% to $627 million in first half 2010 from $477 million in first half 2009 according to new research released by PwC US and the IAB.

However, video advertising still only amounts to 5% of total Internet ad spending, with search, at 47% (over $5.7 billion in FH '10) still dominating the landscape. However, video advertising is benefiting significant tailwind and is poised for lots of growth ahead. In its favor are shifting consumer behaviors toward online viewing, an exploding array of premium-quality/brand-friendly content, broad adoption of connected device which enable long-form online-delivered video viewing on TVs, and improved ad infrastructure (e.g. targeting, management, engagement, etc.).

When I talk to executives at video ad networks, brands, agencies and content providers they all confirm lots of activity in moving over TV and online budgets to video. I expect plenty more of this as online video viewership gains further momentum. The full ad spending breakdown for FH '10 is below.