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Blinkx raises the stakes in online video

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Blinkx ('blinks'), the transatlantic video search engine, has beaten Google, Yahoo! and MySpace to a big technology punch by going live with a system that "listens" to speech in clips in order to allow advertisers to target users more specifically.

The launch - a concerted attempt to make online video work as a business - represents a big test for the nascent medium, which has been talked up as The Next Big Thing since the internet industry crawled out of its self-inflicted dotcom pit in 2004.

Blinkx's platform, which had been codenamed Project Trilby, launches today under the banner AdHoc. It'll insert video ads that it deems appropriate at the start, in the middle, or at the end of clips. The video hosters, who allow the search engine to index their content, won't neccessarily get a say on what product their users are being associated with, which could see some interesting conflicts emerge.

Despite the hype around online video, nobody's making any real money at it yet. Google's video search has stagnated since the acquisition of YouTube, which began running in-video ads in May, but they aren't targeted on context. It's telling that video search doesn't merit a direct link from the Google front page: the product isn't good enough, and doesn't bring in any cash.

It's likely that the main technical priority for YouTube has been implementing the copyright takedown software which, as a hoster, is vital for it to continue. Unlike rivals Metacafe and Revver, YouTube clips don't appear on Blinkx.

Blinkx's founder, Suranga Chandratillake, had a dig at Google's video efforts in the AdHoc announcement. He said: "Until now, online video advertising was a kind of Frankenstein's monster - an attempt to cobble together technology that was built for Text Web banner advertising and apply it to an entirely new medium."

The debate over whether "interruptive" TV-style advertising - i.e. not just a link or a banner on the side of the page - will ever succeed on the internet remains open. We should have some idea in less than a year from now, when Blinkx releases its first results as a public company. It listed on AIM in May, achieving a market capitalisation of about $350m.

As a start-up, it was subject to takeover talk involving Murdoch's News Corp, but stayed solo. The firm boasts its 111 patents have come at a R&D cost of $150m, and it shows: Blinkx's video search creams the competition right now, zeroing in on elusive clips in a way that is reminiscent of when Google crashed into web search.

In two separate announcements today, Blinkx also announced partnerships with RealPlayer and web search aggregator Dogpile, aimed a getting its search box onto more screens.®

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