Apple And Google Set To Capitalize (And Compete) On Internet TV

Connected TVs and set-top devices enabling consumers to view video from across the Internet on TVs could ultimately drive online video ads and marketing content budgets. The online video ad segment should grow at a 39% compounded annual growth rate (CAGR) during the next five years, becoming a more than $5 billion market by 2014, estimates analyst firm Piper Jaffray, which released a series of reports Monday related to IPTV.

The slow shift of consumers spending more time with online video has already begun. The report explains some private video advertising networks admit to securing at least seven-figure budgets from major TV advertisers. Ad networks like Tremor, and those producing proprietary content like Adconion or BBE, could benefit from the transition. The bottom line, according to Piper Jaffray analysts, points to numerous Internet companies like Apple, Google and Yahoo, as well as Rovi, also capitalizing on this move.

Expect Google TV to comprise about 15% of the connected TVs by 2013, rising to 18% by 2014, according to Piper Jaffray. Intel’s CE4100 SoC and Google’s Android operating system is the technology platform that Sony and Logitech will build into products and release in the fall. Other set-top boxes, media players and TV makers have Google TV products slated for the first quarter in 2011.

Read More: MediaPost

Agencies Divided on Where to House New Mobile Units

In a matter of weeks, several new mobile units have sprouted up within adland, prompting debate in ad circles about whether the offerings should take root within creative agencies or form under media shops.

Omnicom Group recently launched a mobile-marketing consultancy called Airwave under media agency giant OMD. According to Jon Haber, U.S. director of OMD’s Ignition Factory, a media shop is the intuitive place to house a mobile unit.

“Mobile is bought in many of the same ways that digital media is bought, but it stretches across coupons, CRM, texts and out of home,” he said. “It bleeds into all other media types. An agency like OMD touches other media units, so it makes sense for mobile to be in-house so it can integrate into everything from TV to digital.”

OMD has also dabbled in mobile creative work; in 2009, it created the Dockers shakable iPhone ad with rich media provider Medialets. While paid media was a component of the Dockers campaign, it also received a lot of attention for creative.

Paid media has dominated recent buzz in mobile advertising with Apple and Google buying into the category. In January, Apple acquired mobile ad network Quattro and just recently launched its souped-up mobile ad unit, iAd, with big-budget advertisers such as Citibank and Unilever in tow. That followed Google’s $750 purchase of AdMob, which was under prolonged investigation by the Federal Trade Commission until just recently.

But for a platform that also includes brand apps, partnerships with developers and location-based services, there’s much more to mobile than display.

Read More: AdWeek

AOL’s Patch Aims To Quintuple In Size By Year-End

Patch, which has already established itself as the biggest network of neighborhood blogs in the country since being acquired by AOL last summer, plans to accelerate its growth dramatically. Patch President Warren Webster tells us the company will add a staggering 400 hyperlocal sites over the next six months, bringing its total to 500. In order to accomplish its goal, Patch will hire 500 more reporters in 20 states, making it—by far—the biggest new hirer of full-time journalists in the U.S.

AOL (NYSE: AOL) had already disclosed that it intended to invest $50 million to expand Patch this year, but the company hadn’t said exactly how it would allocate that cash. Back in April, for instance, when Patch had 46 sites in five states, Webster told us that the company expected to be “in hundreds of towns” by year-end but wouldn’t be more specific.

Webster says that Patch is selecting towns to expand to based in part on a 59-variable algorithm that takes into account factors like the average household income of a town, how often citizens vote, and how the local public high school ranks; the company is then talking to local residents to ensure that targeted areas have other less quantifiable characteristics like a “vibrant business community” and “walkable Main Street.” Patch hires one professional reporter to cover each community; each “cluster” of sites also has an ad manager who is the “feet in the street” selling ads.

The network, however, says that to date it hasn’t been focusing on generating revenue. “Our philosophy from day one was that the first priority should be to build an engaged audience through journalism,” Webster says. “The second phase is to leverage that audience for local businesses that want to target customers. We’re at the beginning of phase two now.” Right now, Patch is letting local businesses buy banner ads and also letting them set up their own business listings, which they can convert into ads.

Read More: PaidContent.org