“Rocky and Bullwinkle,” once $1.99 an episode, is now free on Google Video. The ad sponsorship model offers a text ad permanently atop the video, rather than the standard pre-roll deal. I still don’t get why consumers would pay that much for a lot of these videos. Granted, a lot of this content would otherwise be gathering dust, so there’s little harm in offering it for a fee. I’m still convinced that publishers will make more on most of these videos by running ads than selling the content. Check out all the once-premium content that’s now free (at least for the trial).
This is a very traditional marketing strategy. It’s obvious Google is using the “loss leader” strategy to draw people in, and then hoping those consumers turn into a Google Video user, and generate other profitable video sales.