Online video that is……. ABC.com sold out all of its video ads inventory for streaming TV shows in Q4 and Q1, and the network has secured agreements from 80 percent of its affiliates to incorporate local ads into the player.

PeerApp looks to be in the right spot. It has been said that 5% of the Internet users consume, by file sharing, 50% of the total bandwidth used (not total capacity) of the Internet. The problem of ISPs throttling bandwidth usage has become an issue. PeerApp develops and services technologies and products that reduce the amount of bandwidth consumed by peer-to-peer traffic by helping ISPs enhance network efficiency and reduce bandwidth costs.

Grossy points out the potential problem……”Introduce a massively popular P2P video streaming service, which, brings that 5% up to, say, 30%, and you have a serious bandwidth crisis on your hands.”

Facebook.com, the social-networking Web site, said Tuesday it is moving into television by teaming up with cable operator Comcast’s online video site Ziddio to produce a new series from users’ clips called Facebook Diaries.

The companies are enlisting Hollywood TV producer R.J. Cutler, to choose the best submissions and create 10 half-hour-long episodes that will be streamed online and on Comcast On-Demand. The program will start in March. Terms were not disclosed.

Online video is one of the fastest growing sectors on the Web and major sites including Google’s YouTube and News Corp.’s MySpace are investing heavily in building their video capacity. Analysts say there is high demand for online video inventory from advertisers. ….More

A major player, Wal-mart, has stepped into the movie download business by launching a movie download store online.  For iTunes - that has to hurt.