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Failblog, Engadget, and Joystiq Now Selling Video Ads Through Viddler AdWorks

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Did you know that FAIL Blog serves up 22 million video views per month, and Engadget gets at least 2.3 million monthly views for its gadget videos, while Joystiq gets another 2 million? All three blogs use Viddler, which is now selling ads directly for its top content providers though its just-launched Viddler AdWorks. Advertisers can see a directory of the top three dozen video producers on Viddler and buy ads on their videos (overlay, pre-roll, and post-roll).

Viddler is selling ads against 30 million views a month collectively from those top producers, out of a total of 36 million views for all the videos uploaded to Viddler. FAIL Blog, which puts up videos of pratfalls and people acting stupidly, on its own accounts for 73 percent of Viddler’s video ad inventory, and is a big reason Viddler’s total views have gone from 10 million in January, 2009 to 36 million in August, 2009. After that, the most popular Viddler producers are Engadget and Joystiq, which are both owned by AOL, followed by niche video like WineLibraryTV (142,424 monthly views) and Gary Vaynerchuk’s personal marketing videos, which get only 27,070 views per month).

It quickly dwindles down to very small numbers per show, but Viddler is hoping to change that with its new ad network, and get more of its partners to put more of their best videos on Viddler instead of on YouTube or Blip.tv or Brightcove. As big as FAIL Blog is for Viddler, it streams even more videos directly on YouTube, where it has the 7th-most watched channel.

For ads that Viddler sells directly it is offering video partners ad rates starting at $3 per thousand views (CPMs) for overlays and $10 for pre-rolls. A video show that attracts a highly-focused, affluent niche audience like WineLibrary.TV can command a $10 CPM for overlays. These rates compare to about 80-cent CPMs that video producers currently get for the Google AdWords ads Viddler places in their videos today, and will continue to use for any inventory it can’t sell.

The other attractive element of Viddler’s AdWorks is that video publishers can choose to sell their own ads if they think they can get a higher rate than Viddler. In that case, they pay Viddler a flat $2 CPM for overlays, and $4 CPMs for pre-rolls. So if AOL’s (or Engadget’s) salesforce can get better than a $5 CPM for overlay ads, it is better off selling ads itself ($5-$2=the $3 CPM they would get from Viddler selling the ads).

Video partners also have the option to sign up for a business account, where they pay per gigabyte and can either opt out of ads entirely or participate in AdWorks to offset their subscription costs. So Viddler straddles the video hosting space between a free ad-supported model (like Blip.tv) and a hosted subscription model (like Brightcove). A video producer will have to weigh that flexibility and the guaranteed CPMs Viddler is offering against the broader reach of a YouTube or even Blip.tv, which is about twice the size of Viddler in terms of videos streamed and can now place ads in YouTube as well.

Viddler remains a niche player in the online video hosting industry, but it’s never taken VC money and seems to be carving out a nice little business for itself.

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