Full Length Shows: Shifting the Dynamics of Online Video Viewing
The popularity of user-generated video remains one of the most profound phenomena of the digital age -- but not necessarily of the digital economy. Consumers are demanding, and media companies are providing, access to more premium video content online than ever before. After several years of experimentation, it's clear that the real money in online video remains where it always has been historically -- with professionally produced content created by leading media and entertainment companies.
While it's very easy to become enamored with the latest or coolest technological innovation, from the iPad to Internet-connected TV, when it comes to video, they are all just a means to an end. People are interested in watching quality, premium shows online -- plain and simple.
One of the most telling signs of this dynamic is the sustained growth in the number of people watching full-length television shows. According to a recent report issued by eMarketer, 33% of online adults in the United States, or 58.9 million people, will watch full-length television shows online this year on a monthly basis. Among adults who already watch video regularly online, the rate is 50%. In 2011, eMarketer forecasts the rate among these groups will rise to 39% percent and 56%, respectively.
Online video isn't just about clips anymore, and the business of online video certainly isn't. As a CEO whose company is fortunate to help manage online video for numerous programming companies and television service providers, I see this firsthand as well. Of the billions of premium video views we manage annually, we're seeing average viewing time increase across the board. And, I am more excited than ever about where things are headed.
Like most Web enthusiasts, I want as much video online and accessible as possible. As an industry veteran I also recognize that it takes money to produce all the shows that we love, and that there are fundamental differences in terms of costs and revenue opportunities for how and where these shows are distributed. TV is still the dominant target for ad and subscription dollars and so far broadband video is not generating the same financial results due to lower ad loads, fractured audiences etc. I look forward to the day when technology and financial models evolve so that the kind of screen on which the video plays doesn't matter as much.
But, as a technologist, I also know the journey behind the scenes will be a bumpy one. In fact, I can hardly remember a time when the technology camps were more fragmented. The way video is presented to consumers is fragmented, with technologies like Flash, HTML5, or the upcoming WebM all diverging. The devices and operating systems on which video is presented to consumers are fragmenting as well, with mobile devices, game consoles and connected TVs powered by competitive offerings from the likes of Apple, Google and Microsoft all enriching the market but by the same token complicating the media distribution and consumption life cycle. And, these are just two areas of fragmentation from a laundry list of issues confronting the industry.
While this fragmentation provides consumers and media companies with many choices, it can easily dampen the rate at which premium video is enjoyed more ubiquitously by consumers. Fortunately, there are some underlying technological systems that can help mask some of this complexity and let consumers enjoy long form video in a user-friendly way. And, most technologists that I know haven't forgotten that our products are just the means to the end for consumers -- who simply want to enjoy great content. We all have our work cut out for us, but the payoff for consumers and media companies will be worth it.
In the end, recent reports from both eMarketer and Nielsen show that people are clamoring to watch more premium shows on television and online. With one third of online adults watching full length TV shows, it's clear that premium, long-form video has earned its vaulted, new status in the online video landscape.