NEW YORK Google is testing in-stream video ads with an eye toward creating a system that matches small-scale video creators and advertisers in much the same way its AdSense system works for Web site ads.
In the past week, Google has begun running 15-second commercials for Allstate in videos developed by Beet.tv, a producer of video interviews with executives in the broadband video space.
A Google representative said the spots, which appear after the video content, are a continuation of an earlier test of in-stream video spots that appeared after clips created by EepyBird.com, the originator of the Diet Coke-Mentos viral sensation.
"Google offers an extremely effective platform for content providers and advertisers alike," the company said in a statement. "We respect the rights of content owners and want to work with them to more broadly distribute their content and help them monetize better than ever before."
The company declined to discuss the financial arrangements of the ad deal, but Andy Plesser, who runs Beet.tv, said the Allstate commercials were sold at $15 per thousand views, with the money split between Beet.tv and Google. Plesser said the site gets about 1,000 visitors per day.
"The site has become a very desirable industry vertical for people in the [online video] field," he said.
While Google is running repurposed TV commercials, it has added a graphical overlay inviting viewers to click to www.allstate.com/google for more information. The site contains insurance pricing options.
In addition to post-roll ads for small producers, Google is working with MTV to distribute ad-supported clips via Google's AdSense publisher network.
Following its $1.65 billion October acquisition of YouTube, Google is now the largest Web video platform.
While Google and YouTube reps at the time of the deal said have said it was too early to talk about ad plans, analysts and agency executives envision a new ad system that would use sophisticated targeting techniques to create ad messages users will want to watch, rather than the interruptive spots used by most sites.
One such method would employ YouTube's user-created "tagging" organization system with Google's targeting capabilities. YouTube users upload videos with tags—a series of words that describe the content—enabling viewers to find related videos.
In effect, this creates a ready-made way for pairing videos with relevant ad content. Combined with Google's AdWords platform, such a system could choose from a vast pool of video spots for one relevant to the viewer.