YouTube, the popular online video sharing company, said on Tuesday it will introduce video advertising, its latest step to boost revenue.
The video ads will complement its existing traditional online ads such as banner ads, promotions and sponsorships.
YouTube's first partner is Warner Music Group, which will promote Paris Hilton's debut album on the site. The celebrity hotel heiress, would spearhead a push to offer brand channels to advertisers who want to promote their products to the YouTube community.
This creates the sites first band channel and will promote Paris' new music video, as well as showcase special ads. It will also include advertisements for the Fox Broadcasting Company.
While video's preceding and following clips are an effective means of spreading a company's message and brand on traditional broadcast medium, advertisers may find this model increasingly difficult for online services, such as YouTube.
Of the few ads that teens see associated with online video, Brian Haven of Forrester Research states in a report, the likelihood that they will interact with these ads is insignificant.
These ads are generally perceived as disruptive to the content, Haven adds, noting that 71 percent find ads in streaming video annoying.
Despite becoming the number one video site on the internet, experts have long questioned how YouTube will raise revenue without alienating their audience accustomed to the free site.
YouTube must implement myriad changes, Martin stated in research released last month. The truly difficult task for YouTube is to change the entire culture of the viewers that propelled it to overnight success.
According to comScore Media Metrix, YouTube had 16 million unique U.S. visitors in July, a 20 percent increase from 13 million in June. The site didn't even have measurable traffic until August 2005, when it had 58,000 unique visitors.