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Online video ads leap forward in December, led by AOL

According to comScore, the number of video viewers, and the time they spent watching online video, remained relatively flat in December. However, the number of videos viewed jumped 11% driving a big increase in ads viewed, led by AOL.

December online video viewers & time spent watching

December online video viewers & time spent watching

December comScore U.S. Online Video Rankings show that the number of online video viewers fell slightly over the previous month, to 188 million. For the year, the number of viewers increased nearly 45 over December 2012. The average time each viewer spent watching online video also fell month-over-month, to 19 hours and 24 minutes, but eked out a modest gain of 1.2% year-over-year.

The number of videos viewed per month, however, ended the year on a high note, reaching 52.4 billion; an 11% gain over November and 35% increase over the same month in 2012. Keeping in mind that pre-roll video ads support much of the short-form free online video, this drove a spectacular growth in ads delivered and in the number of ads seen per viewer. Video ads delivered in December jumped 31% over November, and showed a 211% gain over December 2012. Ads seen per viewer saw similar big gains.

Ad impressions delivered, ads seen per viewer

Ad impressions delivered, ads seen per viewer

Leading the charge in the online ad space is AOL. The company saw a healthy increase of 8%, or 4.3 billion video ad impressions, over November 2013. It also underlines how important the adapt.tv purchase has been for AOL. Adapt.tv delivered 1.5 billion impressions in December 2012, making it the number 4 site for video ads in the U.S. One year later, not only has the number of ad impressions at least doubled for the combined company, it has taken the number one ad site mantle holding a commanding 21% lead over the number two site, LiveRail.com.

The impact of adap.tv on AOL’s video business has likewise been impressive. This is in no small part due to the efforts of Ran Harnevo, AOL’s President of Video and former head of adap.tv. He spoke at last year’s BroadbandTVcon in Los Angeles, describing his aggressive syndication model and approach to creating original content. His policies have led to AOL growing from 42 million video starts in December 2013 to 76 million in December 2014. The company has been jostling for the number 2 spot on comScore video rankings with Facebook since June. In the last quarter, since the adap.tv acquisition, AOL has grown unique viewers, video starts and minutes viewed per viewer every month. Facebook’s performance has been far less consistent.

Little wonder that AOL’s CEO, Tim Armstrong, was in an upbeat mood in CES last week. He commented that:

It’s going very, very well. There were signals from our third-quarter results that AOL will continue to have a strong, growing business in video.

If Mr. Harnevo is able to keep up this performance, 2014 could be a very good year for AOL indeed.

Why it matters

The growth in web video and time spent watching has slowed during 2013, according to comScore.*

Despite this, online video ads have enjoyed spectacular growth of over 200% for the year.

This indicates the inventory of online ad avails is increasing fast and that video providers are getting better at monetizing their investment.

*comScore online video numbers are for PC viewing only

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