"This is a tipping-point year, in terms of the interest of advertisers starting to move traditional budgets online, and video is an important piece of that." - Mark McLaughlin, an ad sales director for Yahoo's broadband strategy.
America Online is set to launch AOL Video to the public in the coming weeks, which is a free, ad-supported video service. The service will debut Netscape Video, an on-demand video entertainment service, and should launch by the end of the year. Features will include on-demand video entertainment, with advertising spots similar to those on broadcast television. Some clips will be restricted to AOL members only, but a lot of content is accessible to non-members.
The move is seen by many as an attempt on AOL's part to evolve from its roots as a dial-up Internet access provider, and should help to diversify its business and seize on a burgeoning sector of online advertising. Currently, TV-like commercials only make up a small portion on online advertising, however this may change radically in the future when big companies like pharmaceuticals giant Pfizer get more interested and start getting their wallets out.