Chart: Channel 4 Back To £3 Million Online Profit

Online video investment is now paying off for Channel 4. The Future Media division turned in a £3.2 million operating profit during 2009.

That’s up from 2008, after what C4 says was “savings on platform costs”, following heavy investment in video.

But it’s still only just about the same level of operating profit found back in 2005.

2009 online revenues dipped two percent to £32.8 million. C4 says: “A decline in display advertising online was offset by improved revenues from video-on-demand service, 4oD, which delivered a 60 percent year-on-year increase in full length programme views to 218 million, contributing to a 31 percent year- on-year increase in visits to and to 230 million.”

Channel 4, the not-for-profit UK public service broadcaster, pioneered UK VOD with its pay-for 4oD brand, before making it free and shifting it from app to web. Now it’s amongst those courting online video advertisers.

Last week, it signed one of its biggest such deals, in which BT (NYSE: BT) will market its Total Broadband service in pre-rolls on C4 shows via 4oD, YouTube and SeeSaw, as well as in a custom video player C4 is offering BT in 4oD.

Channel 4 recorded £53.4 million profit from digital TV in 2009, against a £61.6 million loss from its core channel. Full report.