How do you scale something that decreases in value with every new customer it acquires? You can only pump so many fake video promotions into a market before it's completely saturated and people start to resent the constant assault of your ads. Not to mention the fact that every Tom, Dick and Jane with a camera is already pushing their own videos every chance they get. Then there's this: > “All [Jimmy Kimmel] had done…
When we were doing diligence on Virool we ran our own tests with the platform. We took one of our portfolio company's videos and Spent $300 promoting it. At the beginning the video had 15 views and 0 likes. We were able to finish the campaign in a day, and at the end there were 7322 impressions and 3000 views. Note that Virool only charges when a video has been watched for 30 seconds. The conversion of and impression to a 30 second+ view was above 35% for all of our campaigns and on mobile it was 70.32% (not that it mattered because you aren't charged on conversion of impressions).
The next day we had 5483 views, 28 likes, and 10 comments (almost all positive), without having paid for the incremental boost.
Your point about decreasing value and fake video promotions doesn't hold true with this test nor the experience of other customers. The views are not fake, they come from actual individuals who watch for 30 seconds from legitimate publishers. If they weren't then YouTube could strip a customer of their views as they did with Lady GaGa who lost 156mm views [1]. This hasn't happened once for Virool.
If you watch a video for 30 seconds it is highly doubtful that you are ignoring it. Virool doesn't do bottom of the page video pre-rolls that won't be seen but are counted as a charged view. If you are in an app, it seems odd that you would assume every user ignores a video for 30 seconds. You are correct that there will be plenty of people who do ignore, but as a Virool customer I am not getting charged when this occurs so it doesn't seem like a strong argument why their business is flawed.
Finally, you may feel that people after 1980 have been conditioned to ignore ads, but if companies like Facebook and Google are making billions in revenue from digital advertising, I doubt that marketers are shoving money their way if no one is looking at their ads. In 2012, US digital video advertising was estimated to be around $2.9bn out of a $37.3bn bucket for digital ad spend [2]. The market is still nascent and there is a continued shift of advertising dollars to online and mobile from the classic channels (print/tv/radio). The market isn't anywhere near saturated and I doubt it will be anytime soon.
[1] http://www.huffingtonpost.com/2013/01/29/lady-gaga-youtube-v... [2] http://www.emarketer.com/newsroom/index.php/digital-ad-spend...