Paid Internet TV Would Cut Nearly 8 Million Viewers


"TV Everywhere" efforts won't be TV for everyone -- as 7.7 million viewers could be out of the loop. That is, those who won't pay a fee to watch TV programs online -- shows they are currently seeing for free.

The 7.7 million is the number that Los Angeles-based media researcher Interpret says could be left in the lurch if the cable industry gets its way. It means some 11% of all U.S. active streamers of video, which number around 71 million.

With "TV Everywhere" initiatives, it is cable operators' intention to ensure that those who watch free TV on the Internet are also cable customers. The companies don't want Internet-only viewing coming at cable's expense.

For those who are not cable subscribers, the goal would be to get nearly 8 million streaming video users to pay some sort of fee to access premium TV shows online.



The largest group affected will be lower average-income viewers -- especially younger adults 18-34. Many of these viewers stream video on the Internet rather than pay the much higher expense of a monthly cable or satellite service.

Interpret says that 12% of males 18-24, 14% of males 25-34, 11% of females 18-24, and 15% of females 25-34 only stream TV shows online. The average income of all age groups that only stream video online is $42,314 versus the average income of $60,054 who both stream and subscribe to cable or satellite.

The good news for the cable industry is that 89% of those who stream video online have either cable or satellite service, which comes to 63.3 million viewers. That amounts to 33% of all cable/satellite customers.

The study says 67% of cable and satellite subscribers, or 126.6 million viewers, only view shows via traditional TV services.

One major potential stumbling block for "TV Everywhere" efforts, says the study, will be the higher commercial loads expected for premium TV shows. Right now, premium TV sites such as offer just one 20-second ad break. Others, like, run three or four 30-second commercials per hour-long drama or half-hour comedy.

But it's still far less than the 18 minutes per hour of non-program time that traditional TV runs.

However, it is the intention of "TV Everywhere" to increase current commercials online -- to run online TV programs with the same 18 minutes per hour of commercial and TV promos as traditional TV. Interpret believes this could force some viewers back to traditional TV usage, where their DVRs will allow them to fast-forward through commercials.

The study believes that "TV Everywhere" should add value for users, supplying shows they can't get elsewhere. It says, for example, that 45% of online streamers regularly watch programs that are no longer available on traditional TV.

In addition, to supplement traditional DVR usage, the study says that "TV Everywhere" should offer current seasons of full-length programs as soon as possible. Nearly three-fourths of those who regularly stream video do so to catch up on recent episodes they missed on TV.

5 comments about "Paid Internet TV Would Cut Nearly 8 Million Viewers".
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  1. Jonathan Mirow from BroadbandVideo, Inc., October 29, 2009 at 2:25 p.m.

    Look, a revenue model that actually works! If you're a current cable subscriber you get TV Everywhere (for no additional fee, I'm hoping) and if you're not - you have to pay to get content that is actually worth watching. Ok, I take back my comments of the other day that people will only pay for financial info or porn - SOME people might pay for this. Dunno about poor Hulu - watched a movie the other day all all the spots were freebies. Kind of creepy to watch World Hunger spots in the middle of a zombie movie. Happy Halloween All!

  2. Douglas Ferguson from College of Charleston, October 30, 2009 at 10:28 a.m.

    Two points:
    Anyone who believes "control" can be put back in the bottle is not thinking ahead. Surely someone (perhaps that Dutch teenager who keeps breaking copy-protection on DVDs) will devise a way to capture streaming video to a hard drive. Once the streams are re-digitized locally, it will be a simple matter to record show and fast-forward through commercials. No one, to quote Bob Garfield, wants to watch commercials anymore (if they ever did).

    And what's wrong with charging for shows that are free? We already have tens of millions of people duped into paying for water in bottles that is no better than the water coming from their household tap. Mencken said it, no one ever went broke underestimating the intelligence of the American public.

  3. Douglas Ferguson from College of Charleston, October 30, 2009 at 10:41 a.m.

    Capturing streaming video is easier than I thought:

  4. Nate Pagel from Podaddies, October 30, 2009 at 1:52 p.m.

    Hulu has several ad breaks, not just one as reported above.

  5. Michael Martinez from SEO Theory, October 30, 2009 at 6:25 p.m.

    I gave up watching TV for the most part simply because of all the advertising. Now a show really has to capture my attention to keep me as a viewer.

    Not that I stream much online but if this initiative succeeds it won't drive me back into TV Commercial Hell.

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