Yahoo! Video is now transcoding user video uploads to 700kbps, up from 300k previously. Now that so many households are capable of viewing high quality content, online video sites are being forced to differentiate themselves or simply stay competitive based on quality.

In recent months, YouTube has increased video quality. Vimeo and DailyMotion have begun to offer HD video. Bandwidth for a big company like Yahoo! is pretty cheap, but it’s difficult to imagine that any of these companies will see an increase in ad revenue proportional to the resulting increase in bandwidth cost any time soon.

Instead we’re still in a land grab situation, with companies vying to compete with YouTube to stay competitive in an online video ad market projected to reach $4.3 Billion in 2011.

Tags: Yahoo! Video YouTube Vimeo DailyMotion quality

This entry was posted on Monday, March 24th, 2008 at 10:54 pm and is filed under Video Portals. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.