• by kyle , Daisy Whitney , May 1, 2009

The laptop's open but the TV is still on

TiVo might be a verb, but it's not an action for most of the younger generation. Instead, Internet television is the preferred digital video recorder for the youth of America. When they miss a show, they're opting for online video over a DVR, according to new evidence from Solutions Research Group.

In a recent study, the research firm found that 70 percent of 18- to 34-year-old online Americans have watched TV on the Web at some point, but only one-third of that group has ever viewed a show on a DVR or a TiVo. That means media companies and advertising agencies should keep an eye on the twentysomethings - their time-shifting behavior will determine the future of the business.

Nomadic by nature, young Web users are more apt to have a laptop with them instead of using a fixed household device like a DVR. "Younger generations are bonding with a laptop as their media portal of choice, just as previous generations did with TV and, before then, radio," says Kaan Yigit, president of Solutions Research Group. "It's not so much the end of TV as much as the beginning of a different kind of TV, one that is portable, flexible, shareable and searchable. This is the expectation of a new generation."

Their attitude is it's just as easy to go online and click when they miss a show than to remember to record it in advance. "At the 30,000 feet level, it's obvious to most that online will become the main platform for video entertainment," Yigit says. "When we reach a true tipping point is debatable. Some say five years, others 10. But it will happen, based on all the indicators."

That's because more people are watching more video online more of the time. Casual viewing of online TV shows doubled to 50 percent of the online audience in 2008 from 2006. Sure, we may not be watching a lot of hours on the pc, but we're becoming accustomed to it as another type of TV set. "As more content becomes available online, whether on network sites, Hulu, or via cable-delivered online portals of the kind Time Warner Cable is working on, the question will become, 'Why do you need a DVR?'?" Yigit says.

But let's remember that the wholesale shift away from TV hasn't happened yet. Most consumers aren't ditching their cable or satellite service in favor of online video viewing, according to a report from Leichtman Research Group. That report found a mere 3 percent of online adults would pull the plug on cable to just watch video online.

It's worth noting, though, that while only 8 percent of adults say they watch less TV because of their Web viewing habits, 18 percent of teens say they're turning away from the tube thanks to the Internet, reinforcing the premise that younger consumers will lead the charge into full-time online TV and, eventually, to mobile video. The latter has a medium-gaining momentum, thanks to the popular iPhone and similar smartphones. Yigit says 22 percent of wireless users now have a smartphone, up from 8 percent two years ago. About one-quarter of Americans with a wireless device said they watched a short video in the past month in the fourth quarter, up from 10 percent who did so two years ago.

The long and short is we're not turning off our TVs. Not yet, at least. But as we watch more shows on our phones and our computers, we soon will.