Glam Media tries to do something new, which is nice, but not necessarily a brilliant idea. They launched GlamTV, which licenses video content from third parties and allows their publisher network to then show the video content with Glam-embedded ads.
I assume this was driven by a lack of web sites that had significant video volume in Glam’s sweet spot, so they are trying to build out the content themselves. My gut is that the best web sites in Glam’s network won’t want to use this syndicated content, so the upside to building their own video inventory and then building a video network on top of it will be minimal.
As I have long said when it comes to start-up ad networks, it just takes a couple of deals to look like you have a nice little business – they could close eight or nine $50,000 tests the first month and think (and sell to investors or acquirers) that this is the base of the hockey stick when it is really just the same kind of bump a new web site gets when they get TechCrunched. Huge traffic for the first week and then a tiny fraction of that traffic actually sticks around. Getting $50 cpms, as they have discussed at length, is great, but there are a bunch of other important questions: Sell-through rate and eRPM. If they are selling all of the inventory at $50, that is a hit it out of the park business, but if publishers aren’t getting a couple of bucks (both the syndicator and the syndicatee, I would suspect), then it will be hard to build a viable business. Can they build to a decent sell-through that nets out to an eRPM that high? Seems challenging.