• by June 7, 2011

Estimating Netflix's prime-time audience as equal to a mid-sized cable network, CBS Chief Research Officer David Poltrack told an Internet Week audience on Tuesday that the rapid growth of the subscription service has been the most striking result of CBS Vision¹s most recent research into "emergent" media.

Speaking at a Collaborative Alliance event hosted by Havas Media¹s MPG and Media Contacts, Poltrack said that other new ways of viewing TV, such as online streaming and even smartphone streaming, have not been growing among what he terms "fully connected" consumers -- those who have both digital TV and high-speed broadband. This group has grown from 25% of all households in 2006 to more than 50% today.

But among the consumers who participated in the most recent CBS Vision research at its Television City facility -- the MGM Grand in Las Vegas -- 43% are now Netflix users. A year earlier, Netflix was so small that CBS grouped it into the "other" group, Poltrack said.

Turning to the streaming of full-length TV programs in particular, Poltrack said that Netflix has now almost caught up to Hulu.

As for devices such as Google TV, Apple TV and Boxee, the CBS research found "not much demand" for getting Internet access over TV among the "fully connected," while two years ago, "people thought getting TV on the Internet was very cool," Poltrack explained.

Now that they have smartphones and iPads, they prefer not sharing much on their TV screens.

One category that is growing, Poltrack continued, includes devices like Sony PlayStation, Nintendo Wii and Xbox, which are "becoming a major source of video content" delivered to TVs. But none of them approaches Netflix in doing that, he said.

As Netflix and other players rival new competition from Amazon, "it will come down to a content play," Poltrack said. In that regard, CBS Vision asked respondents what "programs you must have." Saying that the average person chooses 14 shows they would want included in any video service, Poltrack revealed that 90% of the research subjects said it would be a deal-breaker if at least half those shows were not included.

As for advertising, eMarketer co-founder and CEO Geoff Ramsey, also speaking at the MPG/Media Contacts event, pointed to a "lack of quality inventory" as a key drawback limiting ads on online video. Other factors, he said, include high CPMs compared with TV, targeting capabilities, lack of standards and limited reach: only 6% to 10% of people watch online video on TV screens, he noted.

Saying that "marketers are becoming media companies," Ramsey said they need to create "magnetic content," which he defined as "content people go and seek out instead of targeting." He compared the process to fishing, where marketers "cast out a line with the best bait." Then, once hooked, you feed the viewers more bait to keep them biting.