• by Wayne Friedman , August 3, 2009

Pasadena, Calif. -- Good news for CBS comes from new Internet research and their older-skewing traditional TV demographic. Younger TV households may be another story.

Simultaneous use of TV and the Internet is just as high with young viewers as with the older crowd, according to David Poltrack, chief research officer of CBS Corp. and president of CBS Vision, during a press briefing at the Television Critics Association meeting here.

An average of 30.8% of adults 35-54 adults and 33.8% of adults 55-64 multitask Internet and TV usage, according to CBS research. Older adults watching prime time are just as likely to be online as the younger adults, he says.

"They may not be online as much as the younger generation, but when they are, they are just as likely to be watching TV at the same time," says Poltrack.

New CBS research also says online streaming is still a tiny piece of all TV/video viewing. Online streaming is 1.1% of all video activity in the average U.S. household and 1.7% in the average U.S. household with broadband.

CBS Poltrack believes the slower growth rates of DVRs -- now in 32% of all TV homes -- will continue. "The DVR is a transitional technology that will follow the path of the VCR to irrelevance, if not extinction." The DVR growth rate has fallen from 42% two years ago to 21% this past year.

Poltrack believes online video will be the growth area for time-shifted viewing. He says new TV sets with Internet access, as well as Microsoft Vista operating system-enabled computers, will help that trend. Those Vista-enabled computers include Microsoft's Windows Media Center application, which has DVR functionality.

Perhaps more alarming for TV and cable networks -- and certainly cable and satellite TV distributors -- is the growth of broadcast-only TV homes among homes under 35 years of age.

Young families -- looking to save money -- are figuring out how to connect their computers to their TV sets to receive not just short-form videos, but full-length TV shows. While currently TV networks could monetize some money from Internet ad revenues, they would lose much more with viewers fleeing traditional TV, where ad dollars are still priced much higher.

Poltrack says there has been a 22% rise from November 2007 to November 2008 in broadcast-only homes, per the Pew Center Internet and American Life Project. "They have either cut or canceled their cable subscriptions," he says. Poltrack says that until 2007, broadcast-only homes had been declining.

He believes if the broadcast networks can establish online video as the preferred form of non-linear television distribution and can develop a process by which consumers must can get authentication in order to access that content free with commercials -- or pay to access the programming without commercials, from a third-party distributor, such as iTunes -- "then the broadcasters can develop a second revenue stream that has to date eluded them."