Tim (O’Reilly) and Fred (Wilson) are Wrong About Pre-Roll Ads

Tim and Fred are wrong about the impending death of pre-roll advertisements. While the blogger intelligentsia and media-hip sorts may think the things are doomed, they’re dead wrong that most consumers won’t watch ’em.

Recall: People used to boo ads before movies. Now, as I re-discovered in seeing Casino Royale the other night, such pre-movie ads make up 17% or more of the movie length (20 minutes on an average 120-minute flick). I didn’t see anyone walk out before Casino Royale, and I doubt most people will shut off 30-second YouTube segments over 5-10-second pre-roll ads there either.

While I’m no fan of pre-roll ads — whether before movies or before clips of subtitled Iraqis — pretending they won’t be a mainstay of online video and its ilk is utopian dreaming.


  1. I agree with your premise, but your analogy is touch-and-go. People aren’t walking out of movie theaters, but they’re certainly not going to movies the way they used to. Movie theaters in my city (San Francisco) are closing left and right. There are a lot of reasons for this, but I am sure that $12 tickets and $5 popcorn followed by 20 minutes of commercials aren’t serving to nurture the golden-egg-laying-goose.

  2. Movie theater attendance has been dropping steadily for years now- surely this is one of the factors, no? It surely makes me less likely to go to the theater; maybe not a huge impact, but just one of the death by a thousand cuts.
    Additionally, Tim argues (I think with some validity) that one has a lot more options to get online content than you do in the theater- so the markets look (or Tim argues that they look) a lot different. No idea if that will hold up over time, but the argument doesn’t seem implausible.

  3. Movie metaphors aside, Paul, I agree that pre-rolls are likely to continue, and people will likely pay little or no attention to them. I just don’t see a 5-second ad as a huge deal.

  4. I think you’ll have a variety of advertising within online video- pre-roll is certainly a contender. Also, companies, like Imagineer Systems, are providing product placement services, much like Massive for the gaming world, which provide new in-video advertising opportunities.

  5. Its all about relevance. Yes, its easier to go to another online service than another movie theater, but if technologies can accurately match contexts for different video clips, then you might get related advertisements that are useful.
    When I went to see the new Bond, I noticed that all the previews were for big action movies.

  6. I thought you were going to be talking about these subtitled Iraqis:

  7. Paul —
    The key to successful online advertising is relevance. If people do relevant advertising as pre-rolls, that will work. But both Fred and I were talking about the race to irrelevance a la dotcom popup ads. Google won in search by finding how to make advertising relevant and valuable vs. the previous portal frenzy in search.
    BTW, how much of that 20 minutes was pure unrelated advertisng, and how much was movie previews (i.e. relevant advertising for a movie audience)?