The Failure to Find Profit in Made for Web Content

But unlike other media, where larger numbers of viewers lead to higher advertising revenue, high-volume trafficon the Web hasn't necessarily translated into big money. Advertisers in short-form Internet video pay about $10 to reach every 1,000 viewers, so even a video that gets watched more than 1 million times -- a big hit by Web standards -- might not generate more than $10,000. Three- to five-minute-long "Webisodes" cost $5,000 to $25,000 to produce.

"So many of the major media companies thought they could just make a good show, put it online and sell advertising," said Jim Moloshok, a former Warner Bros. and Yahoo executive who is now chairman of online advertising company Betawave. "That's like taking a radio show and running it on television."

LA Times: Hollywood Hits the Stop Button on High Profile Web Video Efforts