Video Content Creators Like Rocketboom Can’t Survive On Advertising

There has been a lot of talk about Rocketboom as of late (read Frank Barnako’s Story on MarketWatch.com) as to how they are going to monetize their videos as they try to generate revenue. I think Rocketboom is a great example of where sometimes, our industry and the media that covers it, really goes overboard. From day one, Rocketboom was always talked about as being "successful" simply because they had a ton of traffic and eyeballs. Everyone talked about Rocketboom as the example of how to build a video business on the Internet even though enough people out there were saying, "where’s the revenue"? What’s the business model? Where’s the syndication strategy?

Rocketboom should serve as a wake-up call to those who think that simply having traffic equals revenue and a sustainable, growing business model. Or to those that think online video advertising alone is going to generate a lot of revenue in today’s market. Even companies like ABC and others are supplementing their advertising with corporate sponsorships, and in ABC’s case, they have content that is professionally produced and is content people actually want to watch, unlike many of the other content sites on the web.

As an industry, we should be judging the success of any company based on revenue. I hate to say that as it sounds like something you’d hear from an analyst on Wall Street talking about a public company, but without real revenue, no company can survive. Sure, not all companies need to be huge and do tons of revenue. There is nothing wrong with being small, growing slowly and capturing more eyeballs or market share. But at some point, it all does come down to generating enough revenue to keep the company going, no matter how many eyeballs or notoriety your site has.