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Video Content:
A Premium Opportunity
Paul Verna,
Senior Analyst
pverna@emarketer.com
Executive Summary: Online video content is on a clear upward trajectory. Audience levels and stream counts are
rising, the demographic range of the viewing population is expanding and the content mix is evolving from short,
snack-type clips to long-form content such as TV shows and feature films.
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Video Content 2
The eMarketer View Audience Size
Hulu’s success is largely the result of filling a void in the market for
a one-stop destination for premium, ad-supported content, Behind the Numbers: US Online Video Viewers
particularly TV shows. A broadcast TV ad blitz that started during The growth of the US online video audience will be
the Super Bowl probably helped cement the idea in people’s fueled by a confluence of factors that include:
minds that they could enjoy a growing selection of first-run shows,
■ Improvements in streaming quality and increasing
as well as older classics, online.
availability of HD content online
Break Media, in an interview with eMarketer, July 2009 short-form user-generated clips to episodic TV, live
sports and feature films
For all of Hulu’s success in the premium sphere, YouTube remains ■ A movement toward clear monetization models for
the clear leader among video sites by most relevant metrics, online video, with episodic TV and mass-media
including stream count and unique viewers. YouTube is still the news clips leading the way in the ad-supported
go-to destination for user-generated clips, but the Google-owned realm, and feature films and sports capturing
company has been trying to broaden its offerings to include transactional revenues
premium content. Its strategy has been to sign content deals with
■ Better integration between Web-enabled devices—
film studios and TV program owners that are not affiliated with
such as personal computers, smartphones and
Hulu. Despite its efforts at reshaping its brand, YouTube has a long
netbooks—and traditional viewing platforms such
way to go to shake its association with homespun videos.
as TVs and digital cable boxes
A number of trends will keep online video on an
aggressive growth trajectory in the coming years.
The number of US online video viewers will grow to 188 million in
These include mobile distribution through smartphones and
2013, from 144 million in 2009. These figures represent individuals
next-generation networks; HD streaming and other quality
who download or stream video content at least once per month.
enhancements; better integration among PCs, digital cable boxes
and TVs; and interactivity features that work better online than on TV. US Online Video Viewers and Penetration, 2008-2013
2008 2009 2010 2011 2012 2013
Online video viewers (millions) 135 144 154 165 177 188
“In the US, we’ve finally got a critical mass of
% of Internet users 70% 72% 75% 78% 82% 85%
smartphones that can stream Web video in
% of population 44% 47% 50% 53% 56% 59%
a way that’s commensurate with people’s
Note: individuals who download or stream video at least once per month
expectations.” —Cameron Brain, CEO, Open Box Source: eMarketer, July 2009
Technologies, in an interview with eMarketer, July 2009 105370 www.eMarketer.com
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New monetization experiments will also shape the future of online For additional information on the above chart, see
video. YouTube and Hulu have both publicly floated the notion of Endnote 105369 | 105370 in the Endnotes section.
charging consumers for some content, and media companies are
also considering paid subscriptions after migrating most of their Online video viewers will make up 85% of Internet users in 2013,
content to ad-supported models. Internet service providers are up from 72% in 2009. This will put online video within range of Web
also experimenting with metered bandwidth schemes, so if these activities such as search and e-mail, which are nearly at saturation
take off, the heaviest users of Web video would presumably have points among US Internet users.
to pay for their consumption.
Relative to the US population as a whole, online video will achieve a
It is difficult to imagine the public tolerating a return to paid content 59% penetration rate in 2013, up from 47% in 2009.The mass-market
for video genres that are currently ad-funded. Accordingly, the tipping point will occur in 2010, when online video will be viewed by
most likely scenario is that Hulu and YouTube might charge a fee for 50% of US consumers.
ultrapremium content such as movies and sports, and leave the
rest of their inventory—TV shows, news, humor, user-generated
clips—in ad-supported formats.
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Video Content 3
Audience Size
Nielsen Online put the number of US unique viewers of online video A UBS study projected that the number of US online-video-connected
at 134 million in May 2009—a 12.8% increase over the prior-year households would increase to 39 million by 2012 from 15 million in
figure—while comScore estimated 152 million viewers in April 2009. 2009.Assuming that the average US household size is 2.6 people
(using the US Census Bureau’s 2005–2007 estimate), the UBS figures
Comparative Estimates: US Online Video Viewers, equate to roughly 101 million people in the US with access to
2009 (millions)
dedicated online video devices (other than computers) by 2012.
comScore Inc.*, June 2009 151.7
US Online-Video-Connected Households*, 2009 & 2012
eMarketer, July 2009 144.0
(millions)
Nielsen Online**, June 2009 133.8
2009 15
Note: *home, work and university locations; data for April 2009; **data for
May 2009 2012 39
Source: eMarketer, July 2009; various, as noted, June 2009
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Note: *households with a networked online video device, such as gaming
consoles, media extenders (e.g., Apple TV), standalone media boxes or
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Source: UBS, "Q-Series: Global Media Themes," June 22, 2009
For additional information on the above chart, see 104941 www.eMarketer.com
Endnote 105642 in the Endnotes section. 104941
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Video Content 4
Audience Size
Similarly, Ipsos noted an uptick in the number downloading video A Deloitte survey of more than 2,000 US Internet users found that
content, as well as corresponding increases in the downloading of 70% viewed user-generated clips, and 80% of those viewers
movies and TV shows. However, these were modest compared regularly watched full clips to completion. These percentages
with the more dramatic increases in streaming activity—a were nearly identical to those for professional clips.
barometer of the success of streaming sites such as Hulu.
Internet Users in Select Countries Who Watch User-
US Internet Users Who Have Downloaded a Digital and Professionally Generated Video,
Video* File, December 2007 & September 2008 (% of September-October 2008 (% of respondents)
respondents) Brazil Germany Japan UK US
December 2007 (n=862) September 2008 (n=935) Source: Deloitte, "State of the Media Democracy Third Edition," provided to
eMarketer, January 12, 2009
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Source: Ipsos MediaCT, "Motion" as cited in press release, December 18,
2008 100936
50-54
1%
9%
2006 2008
Source: Knowledge Networks Inc., "How People Use TV's Web
Connections" as cited in press release, February 12, 2009
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Video Content 5
Audience Makeup
With so many studies showing increases in online However, the use of third-party sites grew dramatically among
older respondents, quadrupling in the 50-to-54 group and more
video viewing, it is worth a look at the demographics
than doubling in the 35-to-49 group. At the other end of the scale,
to discern patterns in the growth trends. the 13-to-17 group saw a slight decline in the use of third-party
sites. The resulting responses in 2008 were relatively close from
An Accenture study of Generation Y (ages 18 to 24) and baby one age group to another, in contrast to 2006, when younger
boomer/senior (ages 45 and up) Internet users found that only viewers were watching videos in far greater proportions than their
the latter group showed growth in online video activity. In older counterparts.
November–December 2008, 36% of boomer/senior respondents
said they watched or posted videos online, compared with 26% in Methods Used by US Internet Users to Stream TV
December 2007. By contrast, the responses in the 18-to-24 group Network Content, by Age, 2006 & 2008 (% of
respondents*)
were virtually unchanged—albeit still higher than among the
13-54 13-17 18-34 35-49 50-54
older segment.
2006
Use TV network 61% 56% 61% 65% 53%
Select Digital Media Activities of US Internet Users, Websites to view
by Generation, December 2007 & video
November-December 2008 (% change)
Use third-party 16% 27% 15% 12% 8%
Generation Y Baby boomers video sites to
(18-24) (45+) view network
video
December November- December November-
2007 December 2007 December 2008
2008 2008
Use TV network 63% 51% 68% 64% 53%
Reading blogs or 45% 45% 15% 26% Websites to view
listening to podcasts video
Connecting on social 80% 82% 18% 28% Use third-party 28% 26% 30% 26% 32%
networking sites video sites to
view network
Playing video games on 44% 45% 9% 13% video
the go (via mobile
device) Note: *among those who access full TV programs online
Source: Knowledge Networks Inc., "How People Use TV's Web
Listening to music on 68% 76% 21% 31% Connections" as cited in press release, February 12, 2009
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Watching/posting 68% 67% 26% 36%
videos on the Internet
Source: Accenture, "Consumer Electronics Products and Services Usage
Report" conducted by Survey.com, provided to eMarketer, March 2009
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Video Content 6
Audience Makeup
Nielsen also noted greater percentage gains among older viewers in For all the gains that online video has made, the medium still
a study spanning from November 2008 to April 2009.The 35-to-49 represents a small fraction of time spent viewing, relative to TV. On
group showed the biggest gain in average time spent viewing during average, US consumers spent 2.4 minutes per day watching
this period, followed by the 65-and-over group.Younger adults and computer video during the survey period, which was less than 1%
teenagers registered smaller increases in viewing minutes. of the 309 minutes they spent watching live TV.
Average Time Spent Viewing Online Video Among US Average Time Spent per Day with Select Media
Internet Users, by Age and Gender, November 2008 & Among US Consumers, by Age, Spring & Fall 2008
April 2009 (minutes per viewer and % change) (minutes)
November April % 18-24 25-34 35-44 45-54 55-64 65+ Total
2008 2009 change 18+
Gender Live TV 209.9 256.0 230.4 335.7 346.1 420.5 309.1
Male 209 249 19% Playback TV via DVR 17.2 15.9 17.2 19.4 8.5 7.2 14.6
or TiVo
Female 151 170 12%
DVD or VCR 34.0 35.4 27.4 20.6 14.0 11.4 22.9
Age
Console games 25.9 13.9 4.9 3.0 1.2 0.3 6.5
2-11 113 116 3%
TV total 287.0 321.2 279.9 378.7 369.7 439.4 353.1
12-17 178 190 7%
Any Web 67.0 55.7 74.1 46.0 41.7 19.2 48.8
18-24 303 349 15%
E-mail 20.3 45.1 46.5 51.4 37.8 11.1 37.4
25-34 253 296 17%
IM 14.8 2.9 14.6 15.1 0.0 0.3 7.9
35-49 187 243 29%
Any software 61.8 50.3 61.6 52.1 35.8 15.6 46.1
50-64 122 139 14%
Computer video 5.5 4.3 2.6 2.0 1.2 0.2 2.4
65+ 67 81 21%
Computer total 169.5 158.3 199.3 166.4 116.5 46.5 142.5
Total 178 206 16%
Mobile talk 29.1 19.0 24.7 17.8 12.3 3.1 16.6
Note: home and work locations
Source: Nielsen Online, "VideoCensus" as cited in press release, May 14, Mobile text/multimedia 11.6 2.2 2.1 1.3 0.4 0.1 2.2
2009 messaging
104094 www.eMarketer.com Mobile Web 0.8 2.3 0.6 0.7 1.3 0.0 0.9
104094 Mobile other (video, 1.1 0.6 0.6 0.5 0.2 0.1 0.5
Even with these gains, older viewers have some catching up to do camera, games, etc.)
Mobile video 0.1 0.0 0.1 0.1 0.0 0.0 0.1
to close the viewing gap. Nielsen’s data showed that, on average,
Mobile total 42.8 24.0 28.0 20.5 14.2 3.2 20.2
18-to-24-year-olds spent the most time viewing video, followed by
Environmental/other 9.2 4.9 2.6 4.8 4.1 3.6 4.4
the 25-to-34 group. video
In-cinema movie 1.2 1.6 3.1 0.6 3.0 2.0 1.8
A study by conducted by Ball State University and Sequent Partners
GPS navigation 0.0 1.2 0.3 2.6 4.1 3.8 2.0
for Nielsen’s Council for Research Excellence reached the same
Other total 10.4 7.6 5.9 8.0 11.1 9.4 8.2
conclusion. In spring and fall 2008, 18-to-24-year-olds spent the
Total 509.7 511.1 513.1 573.6 511.5 498.5 524.0
most time watching online video, followed by 25-to-34-year-olds.
Note: numbers may not add up to total due to rounding
The correlation between age and time spent viewing continued Source: Council for Research Excellence, "Video Consumer Mapping"
through the 65-and-up group in the study. conducted by Ball State University's Center for Media Design and Sequent
Partners, March 26, 2009
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Video Content 7
Audience Makeup
Leichtman Research Group analyzed weekly viewing of TV A Nielsen study of the gender split of the US online video audience
episodes online and found that 18-to-24-year-olds were the most showed that women outnumbered men by 8 percentage points, at
likely to be viewers, at 28%. By contrast, only 6% of boomers and 54% compared with 46%.
2% of seniors reported watching TV episodes weekly.
US TV, Online Video and Mobile Video Viewers, by
US Internet Users Who View Recent TV Episodes Gender, Q4 2008 (% of total)
Online Weekly, by Age, December 2008-January 2009 On the Internet
(% of respondents in each group)
46% 54%
12-17 26% On TV
18-24 28% 47% 53%
Uploaded a video clip 46% 41% 35% 32% 26% 21% Newer users** 1.7
Average time spent 1.5
Note: in the past month
Source: "Global Web Index" conducted by Lightspeed Research, May 28, Note: *10+ years; **<3 years
2009 Source: USC Annenberg School Center for the Digital Future, "Cisco Video
104077 www.eMarketer.com Project Report" commissioned by Cisco, December 17, 2008
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Video Content 8
Online Video Content Landscape
A comScore study of US online video streams and “Some of our most successful partners are
streamers showed that in April 2009, the users who upload lots of short sketches and
other clips, and many of them are making
entertainment category accounted for the largest enough money from advertising to run their
number of online streams, with a total of 9.3 billion. small media companies as a full-time job.”
Entertainment also led by every other metric —Suzie Reider, head of advertising sales, YouTube,
in an interview with eMarketer, July 2009
tracked by comScore—number of streamers,
reach, streams per viewer and minutes per stream. A comparison between comScore’s 2008 and 2009 figures
showed that the number of multimedia streams grew by 412%,
US Online Video Streams and Streamers, by Content leading the entertainment category to 282% growth as a whole.
Category, April 2009
Streamers Streamer Streams Streams Minutes
US Online Video Streams, by Content Category, June
(millions) reach (millions) per per
streamer streamer 2008 & April 2009 (millions and % change)
Entertainment 134 89% 9,348 70 189 June April %
2008 2009 change
-Multimedia* 124 82% 7,914 64 175
Entertainment 2,445 9,348 282%
-TV 57 37% 536 10 36
-Multimedia* 1,545 7,914 412%
-Kids 26 17% 424 16 22
-TV 361 536 49%
-Entertainment– 23 15% 84 4 4
movies -Kids 324 424 31%
-Entertainment–music 22 14% 140 6 16 -Entertainment--music 191 140 -27%
-Humor 14 9% 86 6 9 -Entertainment--movies 55 84 52%
-Entertainment–news 10 7% 35 4 3 -Humor 31 86 179%
-Radio 7 5% 31 4 14 -Entertainment--news 23 35 51%
Portals 79 52% 784 10 16 -Radio 106 31 -71%
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Within the entertainment category, the clear winner was The comScore comparison offers a glimpse into the evolution of
“multimedia”—comScore’s shorthand for videos on popular sites online video over the past year. Television, movie and
such as YouTube and MTV. entertainment news content each grew on the order of 50%,
reflecting an increase in the number of TV shows and films
Not only were the entertainment category and its multimedia available online through sites such as Hulu—as well as the
subset the leading entries in comScore’s April 2009 ranking, they public’s seemingly insatiable obsession with celebrity news.
also experienced the most growth since June 2008, when
comScore published a similar list.
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Video Content 9
Online Video Content Landscape
Humor grew by an even larger factor, showing that the online video
US Unique Viewers on the Top Three Cable News
efforts of venues such as The Onion, CollegeHumor and Comedy Sites* on Inauguration Day, January 2009 (thousands
Central are resonating with viewers. The music category, however, and % change vs. prior week)
fell by a sizable margin, likely a casualty of recent battles between January 13, January 20, % change
2009 2009
some music labels and YouTube over availability of content.
Top three cable news sites* 277 4,138 1,390%
Total US Internet 8,945 13,004 45%
“On the Internet nobody controls Note: between 12pm-1pm EST; home, work and university locations;
*MSNBC.com, CNN.com and FoxNews.com
distribution. Combine that with the fact Source: comScore Video Metrix as cited in press release, January 27, 2009
that the cost of content creation has 101267 www.eMarketer.com
dropped dramatically and you have a Nielsen also reported that the number of total minutes spent
medium that is no longer controlled by a watching online video increased by 129% during the inauguration—
select few, but is open to anybody who surely an indication of viewers tuning in to long portions of the
wants to participate in it.” —Erick Hachenburg, program. It probably helped the inauguration’s online video stats
CEO, Metacafe, in an interview with eMarketer, July 2009 that the ceremony took place in the middle of a workday. This type
of scheduling has also driven online viewing traffic for sporting
Another category that showed steep growth was news/information. events such as the NCAA March Madness basketball games.
Given the important role that online video played in recent media
events—such as Michael Jackson’s death and memorial—it is logical
“People want to stay connected with what’s
that the news category would see a big bump. Underscoring that
going on while they’re at work, and this
point, the 71% growth in this genre was driven entirely by “general
news,” not by the “other” subcategory (e.g., weather).
realm of online video is just the perfect
offering. We definitely see a lunchtime
bump in visitors. People are spending that
half an hour to catch up on the news or their
favorite show.” —Thomas Dodson, product manager,
OVGuide.com, in an interview with eMarketer, July 2009
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Video Content 10
Online Video Content Landscape
Nielsen tracked viewing of network TV shows online and found While a ranking of shows by unique online viewers is a strong
that ABC’s “Lost” led in unique viewers in December 2008—a barometer of the reach of those programs, advertisers are also
validation of how the Internet can supplement broadcast TV. In the interested in how much time people spend viewing shows. By that
case of “Lost,” the show was off the air in December, but the new yardstick, the CW’s “Privileged” was the top show in December
season launched in January 2009, so the spike was most likely 2008, followed by NBC’s “Chuck” and “Lipstick Jungle.” Notably, not
viewers catching up on past episodes. “Lost” was followed by a single TV show appeared on both the top-unique-viewer list
NBC’s “Saturday Night Live” and ABC’s “Grey’s Anatomy.” above and the top 10 list for time spent, illustrating the importance
of multiple metrics when evaluating a program’s appeal to
Top 10 US Broadcast TV Network Entertainment audiences and advertisers.
Programs Viewed Online, Ranked by Unique Viewers,
December 2008 (thousands)
Top 10 US Broadcast TV Network Entertainment
1. Lost (ABC) 1,425 Programs Viewed Online, Ranked by Time Spent,
December 2008
2. Saturday Night Live (NBC) 1,111
Average Unique
3. Grey's Anatomy (ABC) 879 minutes per viewers
viewer (thousands)
4. Desperate Housewives (ABC) 723 1. Privileged (CW) 214.6 29
5. Heroes (NBC) 685 2. Chuck (NBC) 162.5 226
3. Lipstick Jungle (NBC) 153.2 152
6. Ugly Betty (ABC) 631
4. Gossip Girl (CW) 140.0 165
7. Samantha Who? (ABC) 560
5. The Simpsons (FOX) 138.8 41
8. Scrubs (ABC) 519 6. Life (NBC) 137.4 133
9. Survivor (CBS) 496 7. Kitchen Nightmares (FOX) 124.9 40
8. Private Practice (ABC) 123.1 350
10. True Beauty (ABC) 462
9. The Young and the Restless (CBS) 115.6 323
Note: reflects video content on ABC.com, CBS Television, CWTV.com, FOX
10. The Office (NBC) 111.8 374
Broadcasting and NBC.com, including their respective embedded video
players; programs are client-defined Note: reflects video content on ABC.com, CBS Television, CWTV.com, FOX
Source: Nielsen Online, "VideoCensus" as cited in press release, February Broadcasting and NBC.com, including their respective embedded video
12, 2009 players; programs are client-defined
101708 www.eMarketer.com Source: Nielsen Online, "VideoCensus" as cited in press release, February
12, 2009
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Video Content 11
Monetizing Online Video
Perhaps the most frequently asked question about On the whole, the online video industry is expected to tilt toward
ad-supported funding, according to a BMO Capital Markets study.
online video is: “How is it being monetized?”
It estimated that in 2009, US paid online video content revenues
make up 23.7% of total online video spending (the total includes
The answer depends on the type of video. Some genres—such as
advertising revenues). By 2011, paid content will make up only
live sports and feature films—are monetized mostly through
16.1% of the total.
direct transactions with consumers. Entities such as MLB.com and
Apple’s iTunes derive significant revenues from subscription and US Paid Online Video Content Revenues, 2008-2011 (%
download fees for premium content. Consumers in those of total online video spending*)
industries seem willing to pay for this content, so the model
2008 28.4%
seems to be working well for all parties.
2009 23.7%
Elsewhere in the online video spectrum, ad-based monetization is
2010 17.4%
the norm. Following a period in which TV program owners
2011 16.1%
experimented with transactional approaches for episodic content,
Hulu has effectively imposed a new ad-supported model on this Note: includes a la carte and subscription models; *includes ad spending
and paid content
type of long-form, premium programming. Source: BMO Capital Markets, "eMerging Video Markets: The Third Wave of
Media," provided to eMarketer, June 2008
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Video-on-demand (VOD) 9%
The same occurred with online video content on news and media
outlets. Up until a few years ago, media companies charged a fee Blu-ray purchases 7%
for accessing video content on their Websites. Today, virtually all Digital downloads and online streaming 3%
broadcast, cable and print news outlets offer free video online, Note: average spending per month; *from retail stores, subscriptions or
supported by prerolls, banners, overlays and other types of ads. kiosks
Source: The NPD Group, "Entertainment Trends in America" as cited in
press release, May 12, 2009
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Video Content 12
Top Video Sites
One of the most significant developments in online comScore showed a higher video count for Google sites in April
2009, possibly a result of including Google Video as well as
video over the past year has been the success of
YouTube in its ranking. However, comScore calculated Google
Hulu. The site has become synonymous with TV sites’ stream share at 40.7%—significantly lower than Nielsen’s
viewing online, much as YouTube epitomizes the estimate. It is possible that comScore’s inclusion of university
locations added content from college-oriented sites not tracked
user-generated space. by Nielsen, thereby affecting the percentage shares.
In April 2009, Hulu’s stream count was up 490% over the previous Top 10 Online Video Properties Among US Internet
year, according to Nielsen. That put Hulu in the No. 2 slot behind Users, Ranked by Videos Viewed, April 2009 (millions
YouTube, as ranked by total streams. and % of total)
Videos % share
viewed
Top 10 US Web Brands, Ranked by Total Video
1. Google sites 6,832.0 40.7%
Streams, April 2009
2. Fox Interactive Media 512.9 3.1%
Total % change % change Share
streams vs. prior vs. prior of 3. Hulu 397.0 2.4%
(millions) month year streams
4. Yahoo! sites 355.2 2.1%
1. YouTube 5,490.2 0.2% 35.5% 58.1%
5. Viacom Digital 315.2 1.9%
2. Hulu 373.3 7.1% 490.4% 3.9%
6. Microsoft sites 288.3 1.7%
3. Yahoo! 203.6 -12.2% -8.1% 2.2%
7. Turner Network 272.7 1.6%
4. Fox Interactive Media 201.4 -3.0% -38.8% 2.1%
8. CBS Interactive 202.8 1.2%
5. Nickelodeon Kids and Family 175.9 -10.3% 15.9% 1.9% 9. Disney Online 132.2 0.8%
Network
10. AOL 121.4 0.7%
6. MSN/Windows Live 164.4 -2.7% 9.8% 1.7%
Total Internet 16,785.4 100.0%
7. ABC.com 148.8 -15.9% 144.8% 1.6%
Note: home, work and university locations; includes both streaming and
8. MTV Networks Music 143.4 15.7% 359.6% 1.5% progressive download video; excludes video server networks
9. Turner Sports and 130.6 -5.1% 60.0% 1.4% Source: comScore Video Metrix as cited in press release, June 4, 2009
Entertainment Digital 104596 www.eMarketer.com
10. CNN Digital Network 112.5 8.7% 32.7% 1.2% 104596
Overall online video usage 9,453.0 -2.3% 24.2% 100.0% YouTube also leads in unique viewers, according to comScore’s
Note: home and work locations; includes progressive downloads but
April 2009 figures. Google sites—which include YouTube and
excludes video advertising Google Video—attracted almost 108 million unique viewers,
Source: Nielsen Online, "VideoCensus" as cited in press release, May 14,
2009 nearly double the total of Fox Interactive Media properties (parent
104092 www.eMarketer.com company of MySpace) and nearly triple that of Hulu.
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YouTube remains by far the biggest online video site, and the Top 10 Online Video Properties Among US Internet
Users, Ranked by Unique Viewers, April 2009 (millions
undisputed leader in the user-generated category. Nielsen and average videos per viewer)
estimated that YouTube served more than 5.4 billion streams in
Unique Average
April 2009—a 35.5% increase over the previous year. Its share of viewers videos per
viewer
streams stood at nearly 58.1%.
1. Google sites 107.9 63.3
2. Fox Interactive Media 58.8 8.7
3. Yahoo! sites 45.4 7.8
4. Hulu 40.1 9.9
5. CBS Interactive 37.1 5.5
6. Viacom Digital 34.6 9.1
7. Turner Network 34.2 8.0
8. Microsoft sites 32.0 9.0
9. AOL 23.7 5.1
10. Facebook 13.3 3.3
Total Internet 151.7 110.7
Note: home, work and university locations; includes both streaming and
progressive download video; excludes video server networks
Source: comScore Video Metrix as cited in press release, June 4, 2009
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Video Content 13
Top Video Sites Future Trends
As measured by time spent viewing, YouTube also came out on top The growth of online video in the US will be fueled
in a Nielsen survey of US Internet users ages 35 to 49. These viewers
by convergent trends in technology development,
spent more than 2.9 billion minutes on YouTube in April 2009,
compared with 933 million minutes on Hulu. However, in terms of content availability and consumer behavior.
growth, Hulu scored highest in the ranking, increasing its minute
count by more than 150% in April 2009 over November 2008.
Mobile
With an installed base of video-capable smartphones in the tens of
Top Five Online Video Sites Among US Internet Users
Ages 35-49, Ranked by Time Spent Viewing, November millions of units, the US seems poised for a surge in mobile video.
2008 & April 2009 (millions of minutes)
One of the key drivers to growth in mobile video is the capability to
November 2008 April 2009
stream video live in browsers, as the iPhone 3GS does. This feature
Site Time Site Time
spent spent allows people to use their smartphones the way they might use
1. YouTube 2,740 1. YouTube 2,983 the Web without relying on a specific relationship between the
2. Hulu 372 2. Hulu 933 content owner, device manufacturer and mobile carrier.
3. Megavideo 225 3. ABC.com 313
4. CNN Digital Network 154 4. NBC.com 215 Monetization
5. Nickelodeon Kids and Family 143 5. CNN Digital Network 187 One of the ripple effects of the emergence of Hulu has been a
Network
sense of clarity in the monetization of online video. Contrary to a
Note: home and work locations
Source: Nielsen Online, "VideoCensus" as cited in press release, May 14, few years ago, when content owners experimented with
2009
transactional models for news videos and episodic TV content
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online, those genres are now firmly in the ad-supported camp. At
Hulu viewers in every other age category also increased their the same time, feature films and live sports are funded mostly
average viewing time on the site, according to Nielsen. The groups through fee-based systems.
with the biggest gains were those over age 35, with the largest However, both Hulu and YouTube have publicly stated their desire
percentage increase among seniors. to experiment with transactional approaches, and news
organizations have also sent signals that they intend to charge
Average Time Spent Viewing Video on Hulu by US
customers for some content that is currently free. Also, Internet
Internet Users, by Age, November 2008 & April 2009
(minutes per viewer and % change) service providers are testing metered-bandwidth plans that would
November April % impose fees on the heaviest users of online video—the most
2008 2009 change bandwidth-intensive form of digital content.
2-11 50 122 143%
12-17 78 129 65% If these experiments are deployed without regard to potential
18-24 151 379 151% consumer backlash, they could threaten the growth of online
25-34 237 353 49% video. On the other hand, if Web video and news portals are smart
35-49 164 416 154% about how they monetize their content—for example, imposing
50-64 100 284 184% small fees for only ultrapremium video—they will likely generate
65+ 27 151 232% new revenue streams without alienating their customers.
Note: home and work locations
Source: Nielsen Online, "VideoCensus" as cited in press release, May 14,
2009
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Future Trends
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Conclusions Endnotes
Online video is on a roll, and its future looks as bright Endnote numbers correspond to the unique
as its recent past. Continued success is by no means six-digit identifier in the lower left-hand corner
a guarantee, however, so to keep the medium on a of each chart. The charts from the report are
growth trajectory, industry leaders will need to keep repeated before their respective endnotes.
the following priorities in the foreground.
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Preserve—and extend—current monetization models.
After a period of experimentation in the early days of Web video, Key eMarketer Numbers — Video Content
monetization vehicles have reached a state of equilibrium. Most 188 million US online video viewers in 2013, up from 144
content is funded through ad-based models, with the exception of million in 2009
live sports and feature films. If content owners or site publishers 85% % of US Internet users who will be online video
viewers in 2013, up from 72% in 2009
stray too far from these parameters, they threaten to derail the
59% % of US population who will be online video
course of online video. Instead, the industry should focus on viewers in 2013, up from 47% in 2009
increasing content availability and nurturing existing revenue Note: individuals who download or stream video at least once per
streams. That means more premium, ad-supported content on month
Source: eMarketer, July 2009
Hulu, YouTube and other portals. It also means expanded efforts 105369
by Hollywood and the major sports leagues to make more of their
content available on the transactional models they have so US Online Video Viewers and Penetration, 2008-2013
carefully nurtured. 2008 2009 2010 2011 2012 2013
Online video viewers (millions) 135 144 154 165 177 188
Live by the precept that content is king. The Web has created
% of Internet users 70% 72% 75% 78% 82% 85%
an environment in which content distribution is as simple as
% of population 44% 47% 50% 53% 56% 59%
pressing a “forward” button. This means that content owners, not
Note: individuals who download or stream video at least once per month
distributors, are in the driver’s seat. To maximize market Source: eMarketer, July 2009
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all existing platforms—broadcast, cable, the Web and mobile
Extended Note: eMarketer defines an Internet user as a person
networks. Consumers will expect no less than total availability,
of any age who uses the Internet from any location at least once
whether in the home, on the Web or on the go.
per month. Population estimates used to calculate penetration
Work together to grow audiences and attract marketers. rate are based on US Census Bureau data.
Content owners, cable companies, site publishers and technology
providers have different—often conflicting—priorities, but they 105642
share a common interest in growing their audiences and
expanding opportunities for brand marketers. Companies across Comparative Estimates: US Online Video Viewers,
2009 (millions)
the online video spectrum will need to continue seeking ways to
leverage each other’s strengths, as Comcast, Time Warner and comScore Inc.*, June 2009 151.7
CBS have begun doing. More experimentation is in order, with the eMarketer, July 2009 144.0
ultimate goal of delivering a seamless, compelling online video Nielsen Online**, June 2009 133.8
experience to the consumer.
Note: *home, work and university locations; data for April 2009; **data for
May 2009
Source: eMarketer, July 2009; various, as noted, June 2009
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Report Contributors
Susan Reiter Managing Editor
Joanne DiCamillo Production Artist
Amanda Green Staff Writer
Dana Hill Production Artist
Jared Jenks Numbers Editor
Chris Keating Senior Researcher
James Ku Data Entry Associate
and Production Artist
Nicole Perrin Copy Editor
Allison Smith Senior Editor
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