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Cable Technology Feature Article

April 22, 2014

Mobile and Online Video Begins to Redefine TV

By Tara Seals, TMCnet Contributor

Streaming video—and more specifically mobile video—is on the rise as consumers are increasingly watching streamed or downloaded video when and where they want. According to Experian Marketing Services, as of October 2013, 48 percent of all U.S. adults and 67 percent of those under the age of 35 watch streaming or downloaded video during a typical week, up from 45 percent and 64 percent, respectively, just six months earlier.

That popularity of cross-device video streaming has led to a demonstrable rise of cord-cutting, said the firm. An estimated 7.6 million U.S. homes today are considered cord-cutters, up from 5.1 million homes in 2010, a relative increase of 44 percent. Users of Netflix and Hulu (News - Alert) are the most likely to be cord-cutters. And the top three video properties across desktops and smartphones are: YouTube, Netflix and CNN.

Some say this portends the end of television, but Experian said that the industry is actually witnessing the transition of the definition of “television” from referring to a type of content to a device commonly used to consume video. In fact, television is likely to remain the primary device to consume video as a group for a long time to come, whether the source of video comes from a broadcast signal, a cable or satellite feed or streamed through the Internet, it said.

Image via Shutterstock

"While we are seeing the way we view video drastically changing, television is likely to remain the primary device for consumer video; we just are witnessing the transition of the definition of television," said John Fetto, senior analyst for marketing and research at Experian Marketing Services. "A third of Americans live in households with Internet-connected TVs, giving them the option to stream or download video to the television either directly or with devices such as Kindle Fire TV, Roku, Apple (News - Alert) TV and Google Chromecast."

At the same time, it’s unlikely that the television will retain its primacy as the king of types of video, Experian noted. “In fact, when it comes to viewing downloaded or streaming video, smartphones are already the most commonly used device,” the report said. “During a typical week, 24 percent of all adults and 42 percent of smartphone owners watch downloaded or streaming video through their phone making it the top device for consuming this type of content.”

Video viewing on a smartphone jumps after the work day ends, with the most viewing occurring between 8 p.m. and 9 p.m. But while smartphone video viewing generally is lower during the day, there is clear evidence of a video "lunch" and a late-afternoon video "snack" break when smartphone video viewing spikes, especially among young adults.

All of this of course has implications for advertising. While the advertising model for streaming and downloaded video is drastically different from traditional television, Experian’s research shows that consumers who watch streaming or download video are actually more receptive to advertising in general. That said, only 27 percent of adults who watch video on a smartphone and 31 percent of those who view video on a tablet say that they find video ads on these devices useful.

"While the growing trend in cord-cutting is understandably disturbing to cable and satellite companies and disruptive to the television advertising revenue model overall, the growth in online viewing creates opportunities for marketers," said Fetto. "That's because online video viewers can be targeted more easily and served up advertising that is more relevant, responsive and measureable. Marketers also can be more confident that their online ad actually was seen given that viewers typically are unable to skip ads."


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