AOL has acquired StudioNow online platform for quality video creation and distribution. The acquisition will allow AOL to integrate a fully functional video creation platform into its newly-launched content management system, Seed.com. StudioNow will also continue to develop its existing business as a provider of online video creation, management, storage and syndication services to commercial companies.

The acquisition of StudioNow closed on January 22 and was valued at $36.5 million in cash and stock with a portion of the cash paid out over multiple years.

AOL’s newly launched content management system, Seed.com, assigns, buys and distributes work for all of AOL’s properties in order to meet consumer demand for relevant content in areas including entertainment, news and sports, lifestyle, technology, money and finance, among others. Seed.com allows talented professional contributors to be seen, heard and read on AOL’s more than 80 premium branded and niche content sites. Seed.com will harness StudioNow’s technology platform and national network of more than 3,000 creative professionals to develop and produce quality, professional video at the request of AOL editors in a way that is rapid, efficient and scalable.

AOL also expects to leverage StudioNow’s technology and resources to complement the ongoing work of its in-house studios, both for AOL productions, which creates original video programming such as AOL Sessions, Unscripted, Moviefone Minute and the Engadget Show, and for its branded advertising and content partners.

eMarketer projects that U.S. online video advertising spending will increase from $734 million in 2008 to $5.2 billion by 2014. This growth will far outpace any other online format, with a compounded annual growth rate of approximately 39% between 2008 and 2014.