“There’s an inevitability to Web video that makes it exciting,” said Rob Barnett, the chief executive of My Damn Channel, which features original comedy and music shows.
Reaffirming its belief in made-for-the-Web programming, YouTube last month announced $5 million in grants for online producers. The grants will seed new content for YouTube, a unit of Google, which has largely failed to persuade big television networks and studios to place TV episodes and films on the site. Encouraging more professional Web video is another way for YouTube to expand its inventory for advertisers.
Despite the evidence that viewers are eager to watch more on the Web, the recession was an ugly reality check for purveyors of such programming, and many start-ups were closed. At My Damn Channel, Mr. Barnett hunkered down, trimmed staff and took solace in the fact that he was seeing repeat business from his existing advertisers like Southern Comfort and HBO, even though he was struggling to add new ones. Now, he says, venture capital will allow him to hire more advertising sales staff, add business development workers and broaden the types of shows he creates.
“I often think of my daily business life as a guy running a cable network in the early 1980s,” at the dawn of that medium, Mr. Barnett said. “There is, no matter how you slice it, a timeline for any new industry to grow.”
Web video companies say that advertisers are starting to make million-dollar commitments — hardly a threat to established television networks, but a big improvement for sites that started out making $5,000 at a time. Commercials in front of professionally produced entertainment videos can command $15 to $35 per thousand views, while banner ads alongside the videos can run $5 to $15 per thousand views.
“All of the distributors we talk to have a shortage of premium video inventory, which seems to indicate that that market has really picked up,” said Larry Tanz, the chief executive of the independent studio Vuguru, which is backed by Michael Eisner.
The ad revenue is important, but companies like My Damn Channel say they make more money from the branded entertainment deals, which incorporate advertisers into the story lines.
Ms. Douglas would not disclose the amount that Ikea had paid for the two-year-old “Easy to Assemble,” though she said the budget had increased for season two and again for season three, which is in production now.
Like most Web shows, her series is produced on a shoestring relative to television or film; her bungalow off Sunset Boulevard still doubles as her production office, and she recalled wincing at the $400 price tag of a portable toilet for one of the on-location scenes last year.
Nonetheless, the cast and crew members are now part of unions, and the show has attracted an impressive slate of guest stars, including Jeff Goldblum and Patricia Heaton. Some people “want to do this because they’re not having fun at their television jobs,” she said, nursing a cup of tea in her kitchen, where a white MacBook was plugged in. (Yes, she also owns a desk from Ikea.)
Ms. Douglas, who views Web video as a new outlet for artists like herself, said Ikea gave her great autonomy, asking her only to keep the content family-friendly. This summer, she is recruiting a second sponsor, shooting a third season of the show and planning a tour. She would still like to see “Easy to Assemble” end up on television, but she is satisfied that she has built a franchise on her own, online.
“Nobody doubts anymore that this is the best way to make entertainment,” she said.