In its second-largest acquisition, Amazon buys the company for $970 million.
The Yankee Group says growing residential broadband hook-up will give rise to interactive on-demand marketing. The market will reach $3.1 billion 2005.
Spurred in part by increasing broadband access in U.S. households, marketers will spend an annual $3.1 billion in streaming media-powered online advertising by 2005, up from $44 million last year, according to new research from The Yankee Group. More than just inserting ad messages into audio and video content online, it will include product information and infomercials that shoppers can retrieve on demand as they are making purchasing decisions online. Such “on-demand marketing” will create advertising opportunities expected to command higher fees, says Yankee, which will help drive total online ad spending upward.
“Broadband web users looking to research major purchases will be able to tap into a broad array of videos providing information on cars, computers, and other big-ticket items,” says Yankee Group analyst Steve Vonder Haar. “This is multimedia content that helps people get things done. It shows how the web is best suited for delivering video with a purpose rather than video for couch potatoes.”
Yankee projects that the number of American households with broadband access to allow easy delivery of streaming media will jump from last year’s 5 million to 30.8 million in 2005. U.S. households number about 102 million.