TV Viewing Solid Despite Online Video Growth

MARCH 1, 2007
TV and online video are getting cozier all the time.
Episodes of 24are viewable on MySpace a day after airing on broadcast TV. SlingBoxjockeys use their laptops to watch what‘s on at home, unbound bygeography and often untethered by wires. MediaPCs and AppleTV throwhard drive content into the living room, in files and streams. AmazonUnbox, CinemaNow and Netflix Instant Viewing do the same thing for PCs,letting movie fans get their fix when they can‘t get to a theater.
At least 14% of US adults watched online video once a week as of December 2006, according toLeichtman Research Group (LRG).

The buzz might make you think that online video viewing is coming at the expense of TV, but it isn‘t happening yet.
Although total online video usage has increased in the pastyear, the percentage of adults watching online video remains relativelyunchanged. A previous LRG survey conducted nine months earlier foundthat 4% of adults viewed online video at least daily and an additional11% at least weekly.
eMarketer is optimistic about online video viewer growth, andestimates that 157 million people in the US will be watching onlinevideo at least once a month by 2010.

TV still dominates viewing habits: 93% of adults spend at least one hour a day, on average, watching it.
Much of the buzz about online video is driven by online videoviewer demographics. Men ages 18-34 account for 41% of daily onlinevideo watchers, but make up only 14% of all online subscribers. Thisgroup also accounts for over two-thirds of adults who visit YouTube andview other user-generated content daily.
Just 8% of those who watch video online strongly agree that they now watch TV less often.
"As with most forms of media and entertainment, online video isfollowing the traditional ‘heavy hand‘ model of a minority of usersdriving the majority of the usage," said Bruce Leichtman of LRG."Rather than replacing TV, in the near-term, emerging video serviceslike online video are best viewed as opportunities to complement andaugment traditional TV viewing options."
What if online video was easy to watch on TV?
While 68% of US online adults are interested in watchingdownloaded TV shows and movies on their televisions, only 45% say theywould watch longer videos on their computer screens, according toPoints North Group andHorowitz Associates.

The data, however, are specific to TV shows and movies, contentwhich is produced and formatted to be viewed on TV in the first place.
Online video that is produced for the Web (or podcast video,for that matter) is made for a smaller screen, and is typically shorterin length than content that is made with TV viewing in mind. Blow uponline video for TV viewing and it often looks grainy, or doesn‘t fitthe screen well. This is where the divide between online video and TVis likely to remain.
The perception is that online video is cannibalizing TV time, according to aPiper Jaffraysurvey. Some 42% of US adults believe they watch less TV now than theydid two years ago. Those ages 18–24 and 55 and older were even morelikely to think they watch less TV.
Although TV will still likely be the dominant media device forthe next several years, TV programmers and ad buyers should be aware ofthe ramifications of online video multitasking. If the amount ofswitching and divided attention that currently exists on the computerplatform extends to online video, consumers‘ attention to online TVprograms will be greatly reduced.