Big news. Google is expanding its testing of embedded video ads.
The repercussions of this are huge. I would imagine these ads would, potentially, appear directly in YouTube videos, as well as begin a new technology arms race on determining video context. Like the age before Google, right now, there is no search engine that can understand context in visual or audio data without looking at user-submitted data such as tags, descriptions, and the title. I sincerely hope Google has already made significant progress into this ever important research. If they don’t, someone else will.
Will this catch on? No, not yet. US bandwidth is just too constricted (crappy) at this point. We should expect to see non-beta, non-test video ads from Google some time next year. Of course, if Google was really smart, such ads would only be served to customers that aren’t on dial-up.
The article links to a mockup. I disagree with its implementation. Google gained popularity due to its minimalist and unobtrusive approach to advertising. They will never place a huge banner like that above search results. However, little YouTube-esque video ads on the right are entirely possible.