For years, broadcast and cable TV programmers and distributors have talked about web video as if it didn’t pose a threat to their business, typically arguing that it was complementary, not competitive. And statistics seemed to indicate that was in fact the case — the amount of time people spent watching television continued to increase while web video remained largely a daytime work distraction.
But now there are signs that web video could be displacing traditional TV viewing during prime time. A piece in the Wall Street Journal highlights the shift in consumer behavior, noting that web video distributors are finding that their shows are increasingly being watched at the same time that TV programmers broadcast their hottest shows.
According to the WSJ, in just a year the peak viewing hours for shows distributed by Blip.tv have shifted to the prime-time hours of 8-11 p.m from 12-3 p.m. Meanwhile Nielsen found that the number of viewers who watched online video during prime time hours in March increased 14 percent to 62.4 million over the course of a year. Meanwhile, online viewership during the day grew only 1 percent, to 45.4 million.
And it appears that the growth in online video viewing during prime time is not just due to people “snacking” on web videos from YouTube during commercial breaks. Revision3 CEO Jim Louderback told the WSJ that 40 percent of its video plays happen through devices that are connected to the TV set, which means that users are watching web videos instead of tuning into broadcast and cable programming.
With more consumer electronics devices with Internet connections and web video services built in due to hit the market, it’s easier than ever for consumers to access web video content in their living rooms. And services like Google TV — which aims to combine live, linear TV programming with video and other content from the web — could spell trouble for traditional programmers.
Is there any hope for TV programmers to hold onto their ratings as more and more web content finds its way to the TV? Most have launched online video initiatives of their own — but most have also shied away from making IP-delivered video content available through connected devices. In fact, some, like Hulu, have been antagonistic to companies like Boxee and Kylo that try to make it easier for consumers to view its videos on the TV.
However, even if Hulu and other aggregators of broadcast TV content on the web are able to find their way onto the TV, it still won’t help fight what is becoming an increasingly fragmented market. With infinite choice of broadcast, cable and web content on the TV, we can expect the ratings for traditional programmers to continue to drop — which could lead IP video to eclipse broadcast TV viewing in 10 years, as one research firm suggests.
Related content on GigaOM Pro: Google TV: Overview and Strategic Analysis (subscription required)