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Cable Technology Feature Article

February 05, 2013

Free Broadcast Streaming Sites Rival Netflix for Viewers' Time

By Tara Seals, TMCnet Contributor

While subscription video-on-demand services like Netflix, Amazon Prime and Hulu (News - Alert) Plus drive the most online TV streams by far, the incidence of consumers who used SVOD and free streaming in 2012 was relatively equal, according to research from NPD.

Surprisingly, about 12 percent of U.S. TV watchers reported streaming TV shows for free during the prior three months, compared to 14 percent who watched a TV show via SVOD.

“Over half of the viewers for streaming TV are between the ages of 18 and 34, so the YouTube (News - Alert) generation is evolving from short-form and user-generated content to TV shows and, like YouTube, they can watch where and when they want,” said Russ Crupnick, senior vice president of industry analysis at NPD.

And, to file under “reality check,” Crupnick found that desktop streaming still far outweighs mobile use. “Despite the attention lavished on tablets and phones, an astonishing 83 percent of free TV streaming programs are viewed on a computer,” he said.

Nearly all broadcast and cable TV networks offer free streaming of their programming via the Internet; however, based on NPD’s latest information, consumer usage of free-streaming TV sites varies.

Network-owned Hulu.com dominated free streaming TV, accounting for 43 percent of total streams during 2012. After Hulu, the five broadcast network sites (CBS.com, ABC.com, FOX.com, NBC.com and CWTV.com) accounted for another 30 percent of total streams.

Four cable TV sites -- abcfamily.com, comedycentral.com, MTV.com, and A&ETV.com -- round out the top-ten free streaming TV sites.

It’s likely that free streaming will lose enthusiasts anytime soon, either—something for SVOD providers to consider when next negotiating carriage fees with the networks. All of the top 10 free streaming sites have strong consumer feedback, NPD found, with 75 percent or more of each of these site’s users reporting that they intend to return to the site in the future.

Hulu.com, in particular, has very committed users, given that two-thirds say that they “definitely” will return to the site. 

The research did turn up interesting data points in terms of user interface and windowing. Free sites generally perform well on convenience and site organization, NPD found, showing that convenience and the lack of encumbrance in order to get the streams started pay off for streamers. 

Most of the sites also perform well on current release availability; however, Crupnick noted that Fox.com streamers rate the site much lower on this measure, due to the fact that Fox generally delays availability of its programming. “The consumer response to program availability on Fox, speaks to the often-controversial question of whether the audience detects shows that are windowed,” Crupnick said.

Based on NPD’s findings, the shift toward Internet video distribution drives a more complex and diverse set of content and purchase and rental options to consumers. With it comes a more diverse set of direct and indirect competitors among movie studios and TV networks, as well as their TV and digital distribution partners.

“From the consumer perspective, it is important to monitor the habits and perceptions of the audience as all of these distribution models evolve, which will help align programming to the target audience and inform whether consumers are responding positively to the experience these options provide,” Crupnick said.

Edited by Rachel Ramsey

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