Is Web Video Replacing Prime-time TV?

23 Comments

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 (s GOOG) 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.

Photo courtesy of (CC-BY-SA) Flickr user tnarik.

Related content on GigaOM Pro: Google TV: Overview and Strategic Analysis (subscription required)

23 Comments

Tim Jahn

I’m actually surprised to see the time shift from day to prime time. Last I read, most people watch web videos at work, during the day.

Glad to see it though. The more pressure that’s put on the horrible cable companies the better!

Todd

Output technology probably has very little to do with this. Today, more and more people are watching TV and surfing the web at the same time. NBC and other nets are now exposed on TV(broadcast), cable, satellite, and internet protocols. Advertisers know this, and they are divesting with them. A given viewer may be watching a show on TV, and surfing for dirt on the show, actors, or the music. This is something no one talks about as they discuss boxee and other convergent boxes. Content is the only commodity people are “buying” here. And TV, Movies, and literature have been homogenized into big box inventory, allowing broadband internet to take over with small guys reaching them without having to buy into the network grid.

But this blog that internet is taking over TV makes me wonder. First, I don’t think the blogger put enough time into research… All journalists know statistics lie, and should not be the only source for your story,… or claim (not sure what this is). Of course Blip is gonna brag about their increased traffic, and make announcements that people stopped watching TV for their website. I would expect nothing more from them. I wanted to immediately dismiss this blog as another puff piece for blip, but what about this lack of selection on TV/cable? That may be a missing link here. I’m bothered that all the network shows are carbon copies of other shows. Maybe it’s this lack of creativity and story-less celebrity-oriented content that’s pushing people to the web. People like stories and you can only go so far with crime/court/med dramas and watch-me-have-sex sitcoms. So do the numbers reflect the increase in people surfing the web while watching TV? Or people just sick of paying $100/bucks a mo. each for cable, iphone, and dsl access? It can be any of these that are contributing, so maybe Ryan can work on this and come back to let us know for sure. And without Blip’s input.

Shakir Razak

Hi,

Content, Content, Content.

If the experience is good and equal, as with the current beauty of turning the TV on and selecting the channel for your show, then just as broadbands ubiquitous access has changed the web and provided web-services that weren’t practical in dial-up times, viewers will see all content as equal, and those younger will not differentiate on the pipe or the platform/network.

I still think that iptv is more technically efficient than pure web-tv!

However, It shouldn’t be forgotten that even with those big shiny plasma/lcd’s, people still like to watch the summer blockbuster, the ones with the big budget where resources have been (can be) invested in production and writing.

Yours kindly,

Shakir Razak

Scott Jensen

NewTeeVee, I believe the turning point is one mega-hit PROFITABLE web-series. A must-see program that everyone is talking about. A paradigm changer. I strongly encourage you to keep an eye out for this. When this happens, everything will change. Other content producers will follow suit as they will then have a successful business model copy. The content producers will start up their own web-series to test the waters. That happen and they will naturally move away from broadcast and cable TV networks. Even if they make less money with a web-series since no network suit can cancel their web-series, dictate changes to it, and other garbage.

Chris K

IF there is a mega-hit web series then it will quickly go to cable. ;)

cjkaminski

The data shows significant increases in prime time viewing of internet-originated content. The WSJ article elicited quotes from a man who admitted to never subscribing to cable.

My question is this: Are these statistical increases actually taking away from prime time viewing, or are they additive numbers from people engaged in non-TV activities from 8p-11p?

vinayak

An inevitable shift. What remains to be seen is when (and if) the tipping point comes……a point in time when viewers will just leave enmasse for web TV. That might be a few years out due to a lack of universal broadband and a lack of a solid revenue model today.

Christopher David

This is an inevitable shift. Of course it will vary in the different age groups but for sure the way content will be viewed and consumed. I want to decide when my prime time is and not one mandated by some institution neither in a broadcasted manner. It has to be up to the individual to decide when, where and how to consume what.

Esme Vos

I have not had a TV for more than a year and I don’t notice it. However, when it comes to live sporting events like the Tour de France and the World Cup 2010, it’s necessary to have a TV (or go to a place with a TV). The Dutch network, NOS, which has the broadcasting rights to the World Cup 2010 says that although people can watch it live on the web (as well as TV of course), NOS has to limit the number of people logging on to watch the matches. That limit is 120,000 people. They also say that having more than that number of people will just kill the broadband network, which in the Netherlands is already very fast.

Dan Rayburn

The WSJ is talking about “niche” content, and Revision3 and blip.tv primarily focus on niche content. Nothing wrong with that, but niche content is not the same as mainstream content. So suggesting that “niche” web based video is going to somehow replace the number of hours of prime-time video being watched on TV is simply not a fair comparison.

Chris K

The threat of consumers dropping cable or satellite TV service in favor of a broadband-only subscription—known as cord-cutting– has yet to materialize in a substantial way. Sanford C. Bernstein & Co. recently noted that overall pay-TV subscriptions for cable operators, satellite companies and telecom providers grew by 667,000 in the first quarter of 2010, calling cord-cutting “perhaps the most over-hyped and over-anticipated phenomenon in tech history.” WSJ May 25,2010

Marty

An interesting article I read recently said,

“Cable and satellite networks are evolutionary dead-ends that cannot hope to match the innovative pace enabled by the Internet.

An estimated 10 million Americans watch Internet video on TV monitors via computers. Ultimately it is an intermediate step leading to either (1) browser-centric TVs or (2) TVs, or devices similar to the Apple TV, with their own Apps Store or Yahoo-like widgets. The store would be like the iPhone one, except that its (typically free) applications would enable Web sites like Hulu.com and YouTube to be watched on TV.”

Source: Video Insider

EJM

Ridiculous. Time and time again the reality is that more people are watching television more than ever. They’re supplementing TV time with more media time consumed through other methods. People are shocked at how much time children are with consuming media through different types of devices, but it’s all increasing.

Web video advertising still has no viable business model or revenue stream. Just because you have small bits of incremental revenue does’t mean you have a media platform or a sustainable business. You just have a web site with big time buzz.

Anyone that thinks that TV will go the way of the wind in the next twenty years is nuts. The same companies will hold the rights to the content that sells, it’s just going to be up to them how it is distributed.

Technologists obsessed with free content distribution will never be able to unseat the behemoth of intellectual property that drives the $70B per year television ad business.

Marty Roberts

I think the shift to more IP-delivered video is a given. The more interesting conversation is how we drive revenue per minute of video watched to something equal with TV. When we get there, we’ll stop talking about TV versus web video and just talk about the video business.

Marty
thePlatform

timekeeper

When do you think ISPs are going to want their pound of flesh for choking their pipes with video data?

Comments are closed.