AOL CEO Tim Armstrong was very optimistic during today’s Q1 earnings call when asked about the advertising potential of its new slate of original webshows.
Last week AOL announced a partnership with Nielsen to provide audience ratings for the 16 original shows the company recently debut. Nielsen provides the industry standard for measuring audiences on TV programming and will now translate those measurements into an appropriate rating for long-form, serial web video content. The move should make it more appealing for brands (that typically buy TV ads) to spend money on ads for AOL’s web shows.
On the call, Armstrong said the Nielsen ratings deal “will bring the wall down between web video and TV.” That’s something both streaming video platforms like YouTube and web video producers have struggled to do when it comes to pulling in advertising revenue.
Everyone wants a piece of the $66.4 billion annual TV ad industry budget., and Nielsen may be the key to getting there if advertisers accept that web video content ratings and TV ratings are compatible.
AOL’s strategy similar to what the digital radio industry is attempting to pull off. For instance, Pandora has spent the last year partnering with the same third-party audience measurement firms used by the terrestrial radio ad industry, with the expectation that radio ad clients will value digital radio ads on the same scale as terrestrial ads.