Upfronts 2012: AOL Announces New Flagship Hub For Video Content
AOL is launching a new video hub that will bring its entire library of video content under one umbrella. Dubbed the "AOL On Network," the company hopes 60 milion North America consumers will tune into 14 new content channels that will bring together curated videos from the likes of Nina Garcia, Heidi Klum, and Adrian Grenier and original programming, including the launch of seven new series.
The announcement is being made tonight at AOL’s 2012 Digital Content NewFront at Highline Stages in New York City. The event comes as many online giants roll out their content and meet with advertisers over a two-week period. The digital companies are not only bringing TV industry style upfront presentations, but also offering comfort food for ad buyers -- concepts like "programming" and "channels."
In AOL On, the company's top executives say they are launching a "flagship" for the company where videos won't be programmed through any algorithm, but rather manually curated. According to a briefing in advance of AOL's NewFront, executives say the idea is to create a "new level of trust" with entertainment consumers who might appreciate the relaxation that comes with being handed a channel grid, but also want to partake in the web's strong diversity of content.
"Consumers need a destination to discover videos on the topics that matter when they want them," explains Ran Harnevo, senior vice president of video for the new initiative. "AOL On is at the intersection of relevant entertainment and information served in a way that helps consumers stay on top of what’s ‘on’ now.”
AOL On is a reorganizaiton of 320,000 short-form videos created by more than 1,000 publishers from its former AOL Video, goviral, StudioNow and AOL HD brands. Now, the company will offer 14 channels around different so-called "passion areas" including entertainment, fashion, and news. The channels will be offered across desktop, tablet, mobile devices and connected TV devices.
As for additional original content, celebrities including Rachel Ray, Erin Fetherston, Marc Forgione, Sam Talbot and Christine Vachon have been signed to create "playlists." An example might be Heidi Klum's favorite fashion trends for the summer for the style channel.
In addition, AOL is tonight announcing seven new series, including Digital Justice, a reality show about forensic investigators; Fetching from Amy Harris (Sex and the City) about a young woman who quits her job as a lawyer to open a doggy daycare store; Little Women Big Cars, a series centered around four soccer moms; Next Door Hero, a reality show about America's everyday heroes; Nina Garcia, where the Project Runway star helps women get their mojo back; Tiger Beat Entertainment, a lifestyle show for teens; and ur + 1, a gaming platform where users pick teams of celebrities and compete in a fantasy challenge where points are awarded based on coverage on AOL properties.
Ad buyers are being told they can purchase space by passion channel or by any targeted demo.
“The AOL offering can be a compliment or viable alternative to traditional TV-buying strategies, and we are well-positioned not only from a scale perspective, but from a programming perspective to capture TV dollars," says Harnevo.
AOL hopes to capture the growth in online video spending. The company cites a study by eMarketer where U.S. online video spend is projected to reach $7 billion in 2015.
The "channels" approach to programming web content isn't new. Last October, YouTube announced its own initiative on this front with 100 television-style niche channels. AOL believes, however, that its new video hub, which is going live with tonight's announcement, is organized better.
Up until now, despite the large audiences, AOL has struggled to keep pace with the growth of its rivals.
Last week, Brian Wieser, an analyst at Pivotal Research, noted in a report that online video is rising, albeit with a strong caveat. "Overall, this category grew to $1.8 billion in ad revenue during 2011, up from $1.3 billion in 2010," he said. "However, stripping out our estimates of US-based revenues of $300 at Hulu and $600 million at Google’s YouTube... reveals a surprisingly modest market and growth rate for online video...While our figure remains ahead of the total television industry, growth outside of YouTube and Hulu appears to be far from exploding."
Wieser adds that the "web increasingly exists as a winner-take-most environment in which few companies dominate despite the nominal openness of the platform."
With the announcement, AOL executives believe they are on a path to reset the company's video offerings and make inroads.
“AOL is a brand company. We offer innovative platforms like the AOL On Network, along with vibrant and engaging video content that we know people are flocking to the Web to consume at an unprecedented velocity,” said Tim Armstrong, chairman and chief executive at AOL. “With the launch of AOL On we are bringing people closer to the things that matter, while helping them discover and share the stories and information that color their lives.”