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Summary:

Some 76 percent of consumers watch video on their PC, says a new international study from IBM. But how do IBM’s numbers about the consumption side match with current stats on online video revenue?

Some 76 percent of consumers watch video on their PC, says a new international study from IBM. That’s up 27 percent from last year, according to IBM’s second-annual survey of consumers in Australia, Germany, India, Japan, the UK and the U.S. The study is especially notable because much of the research on video viewing trends is restricted to a single country, usually the U.S. But how do IBM’s numbers about the consumption side match with current stats on online video revenue?

Besides online video on the PC, IBM also found more consumers accessing mobile video, with 32 percent responding that they have viewed video on a portable device or a mobile phone, up 45 percent from last year. But meanwhile, the recession threatens to wipe out mobile video’s miniscule market share and revenue, reports Broadcasting & Cable today.

And shh — don’t tell the networks, who are obsessed with web video being “additive,” but according to IBM, more than half of online video watchers say they watch less television as a result, with 36 percent watching “significantly less.” There’s a pessimistic study out today about ad revenue for TV, too. eMarketer says that between the shaky economy and the growth of online video, U.S. ad spend will decrease 4.2 percent next year to $66.9 billion.

And there’s also some bad news for iTunes. More than 70 percent of IBM’s respondents said they prefer to watch ads alongside their content rather than pay for it. That’s especially true in Japan, where 80 percent of respondents prefer ads. Hulu CEO Jason Kilar used dollar figures to illustrate the same point at our NewTeeVee Live conference last week; he said that the U.S. market for ad-supported premium video is worth $80 billion, whereas DVD sales and other transactions are worth $20 billion in the U.S. (here’s the video of his speech).

Contrary to common assumptions about online video advertising, IBM’s study found that pre-roll and post-roll ads are more popular than mid-roll interruptions and product placement. Unfortunately that section wasn’t described in more detail in the press release we have about the report. As for how the recession will affect spending on web video ad prices, TV Week has a report out today saying that while it will be hardier than other categories, prices are still expected to drop 10-15 percent in the next few quarters.

And finally, major props to IBM for producing a YouTube video to accompany its study! (Though it doesn’t really address the parts I’m interested in…ah well, we can’t have everything.)

  1. I have had a strong haunch for quite some time that web video was not additive. It will eventually cannibalize television’s audience the same way that Encarta cannibalized Encyclopedia Britannica’s sales, and Wikipedia eventually cannibalized Encarta’s position. The market for network content will shrink, but advertising dollars will be spread out over a larger community of producers, many of them independents.

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  2. Of course web video isn’t additive to network TV. The scarce and relatively fixed resource in the equation is people’s time and attention. The only way to really increase that is to make more people ;-)

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  3. [...] increase in the near future as more and more of us are going to watch more and more video online. According to a study by IBM, nearly 76 percent of consumers surveyed said that they watch video on their personal computers, [...]

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