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Online video: crunching some numbers

Nielsen Online offered its first numbers today from VideoCensus, the online counterpart to its famed TV ratings service, and the results buttressed at least one piece of conventional wisdom about streaming video: people might watch a lot of it, but they don't spend much time doing so. The results square with a report today from comScore and Media Contacts, which found that 80 percent of online video watchers in October tuned in an average of less than 3 minutes per day. The stats aren't particularly encouraging for companies hoping to build advertiser-supported video businesses on the Net.

According to the VideoCensus report, nearly 3/4 of all active Web users -- or 116.7 million people -- watched video online in December 2007. The most popular video source, YouTube, drew more than 67 million people that month, followed by Yahoo at 26.6 million and Fox Interactive Media at 18.6 million. Those are sizable audiences, the kind that draw major advertisers. By comparison, Nielsen Media Research found that the most popular show on TV last week, American Idol, drew 28 million viewers on Tuesday and 26 million on Wednesday.

But the breadth of the audience doesn't match the level of interest shown. Although VideoCensus estimated that Internet users watched 6.2 billion video streams in December, they spent on average about 4.5 minutes a day viewing one to two clips. This is consistent with the "snacking" theory of Internet video, which holds that most people aren't interested in long-form video online. Of course, that might be a function of where people are consuming the video -- mainly at their computers, not their TV sets. The comScore/Media Contacts research provided a bit more detail, showing a wide gulf in time spent viewing between the most active 20% and the rest of the audience. The top 20% consumed an average of 14 hours of streamed video in October, or nearly half an hour per day, the companies reported. The next 30% consumed an average of 77 minutes that month, or 2.5 minutes per day, and the remaining 50% only 6 minutes total.

There were at least two other intriguing nuggets from the reports. First,  Nielsen found that in the advertiser-coveted 18-34 age group, women viewed about twice as many streams from network TV sites as men did. But at the four top user-generated video sites -- YouTube, MySpace, Veoh and Break.com -- the ratio was reversed, with men viewing more than twice as many streams as women. And second, comScore and Media Contacts reported that the most active consumers of online video spent a disproportionate amount of time on sites that offered bootlegged TV shows and movies. That helps explain their hefty time-spent-viewing stats. It also shows that, despite the networks' willingness to provide free, full-length episodes online, the earliest adopters of long-form video streaming online are spending most of their time on sites not authorized or monetized by Hollywood.

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Times editorial writer Jon Healey pens opinion pieces about a variety of business issues, and blogs about technologies that are changing the entertainment industry's business model.

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