The Google-owned video venue is not, however, exactly breaking the mould for mobile ads. It is displaying static banners at the top of its youtube.com home page, browsing pages and search results pages. The initial rollout is in the U.S. and Japan. YouTube will not show ads within videos played on phones. Ads also won't appear on the YouTube applications for iPhone and Android handsets.
In one twist,
YouTube is selling the ads on a flat fee per day rather than on a CPM
basis. Shishir Mehrotra, YouTube's director of monetization, compared
the placement to YouTube's front-page ad that is also sold for a daily
"We think it'll provide one of the largest audiences for a mobile ad campaign anywhere on the mobile Web," he said.
YouTube boasts that "tens of millions" of videos are played each day from its mobile site and that traffic has grown 160 percent in 2009. Campaigns since it began testing YouTube mobile ads have included efforts by L'Oreal, Kia and Sony. Mazda is running a campaign today.
Mehrotra said the mobile ads are another step in YouTube's drive to find an ad model commensurate with the site's wide reach. He promised the ad formats would "evolve."
"We're just getting started," he said.
For now, the ads won't include any video or animation since the major mobile platforms like iPhone and Google's Android do not support it. Mehrotra said the ad quality would improve over time as handsets and operating systems both get more sophisticated.
"This is starting with what the browsers can support at broad reach," he said.
Google has targeted mobile as its next big ad market. It has approached that objective on several fronts, including building its own operating system, rolling out the NexusOne phone and inking a deal to pay $750 million for mobile ad network AdMob. That acquisition has not yet closed.