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BizReport : Research archives : April 02, 2012

Forecast: RTB to account for more video ad spending

Real time bidding (RTB) is becoming a growing force in display advertising, but a new forecast from Forrester and SpotXchange predicts it will soon become a force with online video as well. The forecast suggests RTB online video advertising will account for nearly 22% of all online video spending (US) by 2013.

by Kristina Knight

New data from Forrester Research and SpotXchange predicts US online video RTB spending will account for $387 million (2012) of all online video spending and will grow 251%, to reach more than $665 million next year.

"We believe this study provides validation to what we already knew; that RTB will be an extremely strong force of online video spends in the coming years," said Michael Shehan, president and CEO of SpotXchange. "We are seeing very similar percentage growth in our RTB marketplace, and this study proves to us that we've had the right focus all along - to give our RTB buyers, sellers, and DSPs the most helpful and transparent information we can about each bid impression, pricing and inventory availability. We look forward to continuing to lead the way in video RTB in the years to come."

The forecast goes hand in hand with new data from iSuppli, which predicts consumers will begin spending more of their cash on video content over the next few years. In fact, iSuppli suggests US consumers will spend more to watch movies online in 2012 than they will for physical videos. iSuppli suggests more than 3.4 billion video views/transactions will take place in 2012 - specific to films.

Last year the share of physical video transactions was 2.6 billion while the online share was just over 1 billion.

"The year 2012 will be the final nail to the coffin on the old idea that consumers won't accept premium content distribution over the Internet," said Dan Cryan, senior principal analyst, broadband & digital media at IHS. "In fact, the growth in online consumption is part of a broader trend that has seen the total number of movies consumed from services that are traditionally considered 'home entertainment' grow by 40% between 2007 and 2011, even as the number of movies viewed on physical formats has declined."

Tags: Forrester Research, iSuppli, online video, real time bidding, RTB, video consumption, video trends

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