Wednesday, March 15, 2006

AOL to launch free online video service backed up by ads

AOL is today launching one of the biggest free video services on the Internet, serving up vintage shows and short clips backed by online advertisements.

The service, called In2TV, will launch with four advertisers -Intel, Kia Motors, Kraft Foods and Hershey.

Video is AOL's strategy going forwards. They will add pay-per-view downloads later this year and a subscription model next year.

But most significant may prove to be their ad based model. And if they can crack it better than others then online viewers may even flock back to AOL. They are spot on to make video the centre of their strategy - have they also figured out that for the volumes you need a successful ad based model? - probably for movies as well.

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