The online video advertising market in India is expected to touch Rs 200 crore from the current Rs 40 crore, say experts. Online video advertising currently accounts for 15-35% of the Rs 400-crore online advertising market and is expected to grow at 300% in 2009.

Udayan Bose, CEO and founder, Netelixir, said, ?With the advent of Web 2.0, internet viewers are increasingly shifting their focus from television to the Internet to watch their favorite shows and videos.?

According to a recent report by PricewaterhouseCoopers (PWC), the share of internet advertising in the overall advertising pie is projected to grow from 1.4% in 2007 to 2.4% in 2012. The Indian advertising industry touched Rs 19,600 crore in FY07 against Rs 16,100 crore in FY06. The online advertising market contributed to Rs 270 crore in FY07 against Rs 160 crore FY06.

?The presence of international agencies like Jivox and Vdopia in India and Indian agencies like Nautanki.tv entering into this space indicates the growing demand for online video advertising,? said Bharat Rajamani, solution leader (marketing and advertising risk services and risk advisory services) at Ernst & Young.

According to experts, India has a total of 3.5 million broadband connections. This needs to improve for online video advertising to pick up.

Naren Nachiappan, MD (India), Jivox, an online video advertising company, agreed. ?Despite low penetration, Youtube.com is one the most visited sites in India.?

?This makes it clear that even at these penetration levels, online video consumption is healthy and broadband consumption is doubling on an annual basis,? he said.

Given the current economic scenario, a shift is expected in the pattern of advertising, from traditional media to online advertising, which brings better return on investment (RoI) as it is more cost-effective.

?Online video advertisements allow advertisers to target audience based on geography, demography or contextual parameters. It delivers a high brand value, thus providing advertisers a better RoI,? said Rajamani.

According to research agencies, online video advertisements deliver 82% brand recall versus 54% recall for the same ad on television.