Will Web Video Reach the Point Where it Captures TV Ad Dollars?

By Karla Robinson
September 24, 2012

As Web video viewing increases, it would make sense to see a shift in ad dollars from traditional TV to Internet video. “Go where your customers have gone,” Google chairman Eric Schmidt told advertisers earlier this year.
But TV advertisers haven’t made the switch and, “it doesn’t look like [TV ad spending] is going anywhere,” AllThingsD writes.
“Year in, year out, advertisers have been dumping around $70 billion into TV, and the Web video guys really haven’t captured any of it,” the article states. “The growth they have seen comes mostly from ad dollars moved out of other Web properties.”
The post includes a chart created by an investment banker Terry Kawaja and entrepreneur Dave Morgan. It shows that the amount spent on advertising is expected to increase in the coming years, both in television and online video. But measured as a percentage of the total, the money spent on online advertisements will actually decrease.
Big tech players like Apple and Google are expected to shake up the TV industry with new distribution methods.
“But that’s different from disrupting the TV ad business,” the article notes, adding, “if those guys get in, the ones likely to lose out are the existing TV distributors, like Comcast and Time Warner Cable. Then again, any TV Of The Future still needs to get delivered to your home via pipe, and the pipe guys can’t be budged…”

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