Microsoft’s MSN will handle ad sales and technology for the Associated Press’ planned Online Video Network, set to launch at the beginning of next year.
Designed to tap into broadband users’ hunger for video content and advertisers’ increasing interest in TV-like inventory, the new service will be available to the AP’s more than 3,500 newspaper and broadcast members. It will be free to those sites, which will earn a percentage of the revenues gained from ads displayed to their audiences.
“This is the first time we’ve offered members a turnkey solution which includes content, technology and advertising, with a rev share on advertising,” Jim Kathman, AP’s broadcast director of strategy & planning, told ClickZ.
MSN’s existing sales staff will offer advertisers the inventory on behalf of the AP and share resulting revenues with the news organization and distributing publishers. Selling news-adjacent inventory will be nothing new for the MSN staff, which has already been offering such spots on MSNBC. Inventory on the AP service, typically :15 to :30 spots, will be priced on a CPM basis at rates comparable to TV ads, said Todd Herman, MSN Entertainment’s director of advertising and business strategy.
“Our sales force is entrenched in all of the major media markets,” said Herman. “We are in the process of building up the sales team at MSN. That’s an effort that’s underway.”
The AP will deliver the content and ads via the MSN Video Player, which publishers can brand with their own logos. In the MSN implementation, each video clip is preceded by a :15 to :30 spot. While the ad runs, a .GIF file with calls-to-action and links appear to the right side of the video, allowing users to interact.
Herman said he expects most advertisers on the new AP video service to repurpose TV spots, but he hopes more creative innovation will occur over time.
“Those will evolve over time, as creative shops evolve over time,” Herman told ClickZ. “We’re now seeing the creative leaders of agencies say, ‘how much more interesting and compelling can we be in the video unit with new technology?'”
Herman said MSN Video has now matured to the point at which it can begin to offer targeting beyond the content-adjacent options it currently has available. He notes it’s important to give advertisers scale, and therefore avoid slicing and dicing the audience until each resulting segment is large enough.
“We’re now reaching a point of scale where it makes sense to begin to target,” he said. “In the first quarter timeframe we’re going to begin geo- and daypart targeting.”
Herman expects the deal to have a considerable impact on the growth of MSN Video.
“MSN video has seen year-over-year 400 percent increases in our revenues,” he said. “We think with the partnership with the AP, there’s a possibility of increasing 800 percent.”
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