Next Generation Video Monetization Platform Market: Contextual Advertising, Visual AI and Real-Time eCommerce

** Market Overview **

The video monetization platform market refers to the software and tools that enable content creators, media companies, and publishers to generate revenue from their online video content. This is done by putting video ads, sponsorships, subscriptions, and other monetization models on videos to earn money from the viewer traffic they receive.

The market has seen tremendous growth in recent years thanks to the explosion of internet video and platforms. More content is being created andconsumed than ever before. And with higher video consumption, there are more opportunities to monetize. These tools provide video upload and hosting capabilities while offering options to insert ads, enable paid subscriptions, track analytics, and more.

The market outlook remains strong as more devices continue to enable streaming video capabilities and data speeds improve globally. Emerging regions with younger demographics also present new opportunities for continued video viewership growth and money-making potential for creators and publishers worldwide.

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** Key Takeaways **

• Proliferation of online video and mobile consumption driving adoption
• Advancements in analytics, CDN, and ad tech enabling better monetization
• Increasing focus on viewer engagement, retention strategies
• Growing consumption of OTT and streaming services
• North America held largest market share in 2019
• Mergers, acquisitions, partnerships key growth strategies

** Regional Snapshot **

North America held the largest market share of 43% in 2019. High penetration of broadband, smartphones, and OTT services in the US and Canada is enabling the consumption and monetization of online video.

Asia Pacific is expected to grow at the highest CAGR . Rapid growth in mobile subscriptions, expanding internet penetration, and changing consumer viewing habits in emerging countries such as China, India, Japan, and Korea is driving the market. Local content providers are partnering with global platforms for better video distribution and monetization.

Europe holds the second largest market share attributed to rising video traffic, popularity of SVOD services and consumer willingness to pay for digital content. Advancements in advertising technologies are also enabling video platforms to effectively monetize European audiences.

** Drivers **

Increasing Consumption of Online Video Content Across Devices:
The growing proliferation of online video content being published on media sites, social networks, OTT platforms, and other sites is enabling opportunities for effective audience engagement and video monetization. Video traffic already comprises over 80% of all global IP traffic. This rapid surge in video viewership across devices is a key driver.

Advancements in Advertising and Analytics Technology:
Technological advancements in programmatic advertising, AI/ML-powered analytics, automated content tagging, metadata enrichment, and audience segmentation are improving video monetization capabilities. Platforms can now effectively target specific viewer cohorts across devices and analyze content performance to optimize their monetization strategies.

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** Restraints **

Rising Popularity of Ad Blocking Solutions:
The increasing usage of ad blockers is restraining the video advertising revenue for publishers and platforms. Viewers find pre-roll and display ads intrusive leading to bad user experience and adoption of ad blocking plugins and browsers. This directly impacts the monetization performance, conversion of ads into revenues, and future innovation in the ad space.

Slow Buffering and Playback of High-Quality Video:
Delivery of ultra high-definition and high-frame rate video requires fast and consistent bandwidth which can be affected by network congestions and other bottlenecks. Slow buffering due to media codec issues can also negatively impact viewer experience leading to abandonment. This can directly affect a platform's ability to monetize premium video content effectively.

** Opportunities **

Rise of Shoppable Videos and Ecommerce:
Platforms have a massive opportunity to integrate ecommerce functionalities into shoppable videos and enable direct viewer transactions post-video consumption. Video ads are proven to have higher conversion rates and call-to-actions timed during video play can catalyze instant purchases. Transaction-led monetization linked to video engagement provides an incremental upside.

Transition to Contextual Advertising:
Innovations in visual AI can help platforms and publishers detect objects, logos, emotions and contextual clues within video frames at an individual scene level. This granular detection combined with metadata can enable highly relevant and non-intrusive contextual video ads catered to the exact video segment a user is watching. Contextual advertising also provides more addressable inventories across platforms.

** Challenges **

Evolving Video Privacy Regulations:
Expanding regulations on user data privacy like GDPR and CCPA coupled with guidelines around cookies consent, cross-site tracking prevention, and protection of minors can pose technology and compliance challenges for customer intelligence gathering. Robust video metadata anonymization workflows and compliant data access controls will be needed. Gradual transitions to zero-party data models will also impact video monetization workflows.

Revenue Competition from Dominant Players:
Platforms face significant competition for subscriber revenues from leading global OTT platforms who invest heavily on premium originals and hold significant paid subscriber bases. Similarly walled gardens also take up lions share of digital video advertising spend given owned-and-operated ad stacks and their dominance of user eyeballs. Competing sustainably against them poses ongoing business model challenges.

** Market Segmentation **

By Type
• Long Video
• Short Video
• Live

By Application
• Media and Entertainment
• Sports and Gaming
• Others

** Key Players **

• Netflix
• YouTube
• HBO Now
• Amazon Prime Video
• Hulu
• Comcast
• Disney+
• Sling TV
• Indieflix
• IBM Corporation
• iQIYI
• Tencent
• Imgo TV
• Bilibili
• TikTok
• Kuaishou
• Watermelon Video
• Douyu
• GUAI
• YY

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** Key Questions **

Q1. What is video monetization?
A1. Video monetization refers to the different methods and technologies employed by publishers, content platforms and advertisers to generate revenues from online video content through avenues like advertising, subscriptions, tipping and ecommerce.

Q2. What are the key growth drivers for video monetization solutions?
A2. Key drivers are increased online video consumption across devices, advancements in analytics and advertising tech, transition of media firms into digital MCNs, shoppable video opportunities and revenue sharing models with content creators.

Q3. What are some challenges impacting the video monetization space?
A3. Challenges include evolving privacy regulations, revenue competition from dominant players like Netflix and YouTube, engineering efforts to keep up with rapidly changing content formats and consumer behavior.

Q4. Which region accounts for the largest market size currently?
A4. North America accounts for the largest 43% market share currently given the broad penetration of digital platforms and video services across US and Canada.

Q5. Is video advertising growing faster than traditional display advertising?
A5. Yes, video advertising is growing at around 2X rates compared to other formats given higher engagement rates leading to increased marketer budgets.

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